Sams Clubs

WA L * M A R T S T O R E S , I N C

A L I N AWA Z S H E I KH S E RI SH K H A N

WALMART

Sam Walton started as a

specialty store owner of Ben Franklin franchise stores. He was fortyfour when we opened first WalMart in 1962.

What is Wal-Mart
Worlds biggest retailer

Sells Grocery & General Merchandise

One Hour Photo Studio Pharmacy & Optical Centre Tire & Lube Express

Gasoline station
Fast Food Outlet Garden Centre Pet Shop Also feature hair and nail salons, a video rental store, a family

fun center, a branch of a local bank

Wal-Mart
Mission/ Vision To give ordinary folk the chance to buy the same thing as rich people.

Product Strategy

1. Lowest prices across-board the product lines 2. Product USP: core competency
Low prices, In-stock positions, Customer service

Service Strategy

1. Respect for the individual 2. High standards of service 3. Constant strive for excellence middle-class, lower middle Consistent positioning- Always low prices 1. Food retail 2. Non-Food retail 3. On-line food retailer Personalized customer service Co-branding with McDonalds

Segmentation Positioning

Activities

Intangibles Co-branding

Wal-Mart Subsidiaries
Wal-Mart Stores Division US Wal-Mart Discount Store Wal-Mart Supercenter Wal-Mart Neighborhood Market
Sams Club Wal-Mart International Private Labels (Sams Choice , Great Value ,

Equate ,Smart Price)

Key Statistics on Wal-Mart

Founder Sam Walson & Family owns 40% of Wal-

Mart Headquartered at Bentonville , Arkansas , US Total No. of Stores 6775 Stores

Stores in US 4065 Stores in US Outside US 2701 Stores in 14 Countries

Total Employees 1.9 Million Total Sales 415.6 billion in 2011

Net Income 13 billion in 2011

Wal-Marts growth in last 25 yrs

Diversified into Food & Grocery , Private Labels and

online store. Wal-Mart online is the e-commerce website. Has started selling online Music and Movies.

Some interesting figures

First Store opened at Rogers , AR in 1962

Worlds largest Private Employer , fourth only to

Chinas Army ,NHS of UK, and Indian Railways Wal-Mart sells 20% of retail grocery in US and 45% of total Toys sold in US. Its bigger than Europes Carrefour , Tesco & Metro AG combined.

Philosophy Keep prices below everybody else 10 Trip expenses cant exceed 1% of the purchases Spent lots of time in his own store and observe competitors Culture Do not show off buying luxury goods Success The way it treated its associates

Wal*Marts Discount Stores and Sams Legacy

WALMART

Management style Maintain an open-door policy 11 Empowering associates Maintain technology superiority Build loyalty among associates, customers, and suppliers

Wal*Marts Discount Stores and Sams Legacy

WALMART

Consumer Global Brand Opportunities: Wal-Mart

Wal-Mart International

Present in 14 countries
Walmax in Mexico ASDA in UK

The Seiyu Co. Ltd in Japan

Wholly owned subsidiaries in

Argentina , Brazil , Canada ,Puerto Rico

Wal-Mart Market Share / Competitors

Wal-Mart is three times big than

its nearest competitor Carrefour SA z

Wal-Mart Corporate Values

Constant Improvement

Shared Passion, Vision & Organization Culture

Customer Focus Speed

Execution
Improvements In Basic Operations Community Involvement

Strength
Cost advantage Low price & customer-oriented Strong supply chain People are key to success

Weakness
Ignore store decoration Since Wal-Mart sell products across many sectors (such as clothing, food, or stationary), it may not have the flexibility of some of its more focused competitors.

Opportunity
Build its own brand Put efforts on social welfare better image New locations and store types Overseas markets

Threat
Other competitors Intense price competition

Wal*Marts Discount Stores and SWOT Analysis

WALMART

Sector Strategy: Diversification

Diversified into Wal-Mart
Tire & Lube Express, Wal-Mart Optical, Wal-Mart Pharmacy, Wal-Mart Vacations, Wal-Mart's Used Fixture Auctions

1. Non-food

2. Discount format

Wal-Mart Stores, WalMart.com Sams Club 12 international locations

3. E-commerce

4. Wholesale

5. Expansion abroad

Penetration/ Strategy

Advertising Expenditure : 0.3% Of Sales Rev. Only

- By Word-of-mouth, In-store Promos Folksy Facade -Friendly Image Brick & Click Retailing Model Competitive Strategy: - Pre-emptive Expansion - Local Retailing Monopoly - Mkt Penetration By Selecting Most Convenient Locations Acquired Or Constructed Global Buying For Relentless Pressure On Prices Logistic Efficiency: Speed To Market

Potential Development strategy

Re-positioning: Complete Shopping Experience &

Value-for-money Deptt Store Way Beyond Just Low Prices Enhancing Product Range: Full-line Deptt Store Differentiation: Price-based - Best Quality At The Charged Price Merchandising: Max. In-store Merchandise Display Market-broadening: Store-type Adaptations To Local Culture Self-branding: Brand-name Is Extended To Popular Items Ancillary Business: Hair-cuts, Optics, Hearing aids

Backward Integration Acquire McLane Company 20 Texas retail grocery supplier To service both Sams Clubs and supercenters

WALMART
Diversification

Wal-Mart Failures
.

Wall-Mart Failure In Japan

1.

2.

Reasons: Mass firing: It fired 25 percent of headquarters staff, including 1,500 employees and managers, when it took over Seiyu. This is not a normal occurrences in Japan. American values: Japanese believe Wal-Mart is trying to force American values on them, such as mandating that stores stay open 24 hours per day.

Contd.
3. Low-price model: Japanese consumers who want high-quality goods are willing to pay high prices for them. Thus, Wal-Marts low-price model may not be the best fit for the Japanese market.

Wall- Mart Failure In Korea

1.

2.

Reasons: Timing and the location selection: Korean consumers prefer shopping in stores with close proximity. Local rivals had managed to build stores in the early 1990s that had much higher store traffic compared to Wal-Mart. Mismatched merchandising, assortment and marketing: It missed local needs that contributed to WalMarts failure in Korea.

Contd.
3.

Effective channel mix organization: Wal-Mart failed to build a strong alliance with local suppliers. Failed to control all logistic phases, from sourcing to delivery, which dampened WalMarts price competitiveness, which was its core competitive advantage in the US market.

Wall-Mart Problems In China

1.
2.

Reasons: China's distribution sector pose challenges for Wal-Mart and its suppliers. Businesses in China still depend heavily on a hardcopy paper flow of documentation, which adds cost, requires excess manpower, and creates opportunities for human error

Contd.
Solution:

Overcoming these challenges through innovative and flexible supply chain management and logistics strategies are vital to Wal-Mart's success in China.

Recommendation
Understand Consumer behavior

Market Segmentation
Format of stores super centers or hypermarkets Wal-Mart to adopt a blended model of its traditional

format tweaked to fit the reality of Indian real estate

Web References
www.walmartfacts.com

www.gartner.com
www.forrester.com www.hoovers.com www.wikipedia.com www.tsmg.com (Tata Strategic Management Group) www.finance.yahoo.com www.ficci.com

Thank You