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March 15, 2013

Essay on Wall Mart


Wal-Mart is considered as one of the most prominent and highly reputed departmental store which has succeeded in establishing its credibility and reliability among the innumerable customers that visit it each day. Apart from being a large multinational departmental store, it is also immensely active in providing healthy and sometimes even fierce competition to other departmental stores since there are many other stores whose nature of business is the same as theirs.  This has given rise to a competitive market for Wal-Mart which has compelled it to concentrate on building its strengths. As an organization’s strengths allow it to ultimately achieve its objectives.
International Ventures of Wal-Mart
Wal-Mart operates in approximately 15 countries having more than 8,500 stores (Daniel, 2010). However, operates under its own name only in United States and Puerto Rico. In Mexico it operates as Walmex, in UK as Asda, in Japan as Seiyu and as Best Price in India. Wal-Mart has also wholly owned operations in Canada, Brazil and Argentina.
Although the chain is highly successful in US but in other countries, it has mixed results. For example, it is successful in UK, South America and China while it has to pull out its investment from Germany and South Korea because of failure. 
Strengths and Competencies of Wal-Mart
A detailed SWOT analysis is a useful tool to identify key issues, components, and factors that affect an organization and further develop an organization’s strategic planning. This paper will endeavor to highlight the internal strengths of Wal-Mart where strength of a company is distinctiveness of the business or team that gives it an advantage over others in the industry. Some of the strong points of Wal-Mart are as follows  
         Wal-Mart is a powerful brand. It has a good reputation for value for money, convenience and a wide range of products under one roof
         Wal-Mart has grown considerably in recent years and has experienced global expansion (for example, the purchase of the United Kingdom based retailer ASDA)
         The company has to support a core competency of its use of information technology for its international logistics system. For example, they can see how each product is the implementation of country-wide, store-by-store at a glance. IT plays an important role in its efficient procurement
         A focused strategy is in place for Human Resource Management and Development. People are the key to Wal-Mart's business and investing time and money in training people and keep developing them
         It gives SAM’S Club customers an added privilege to buy in bulk while keeping the prices low for their benefit
         It believes in giving top priority to its customers and hence is a customer oriented store. For that Wal-Mart organizes satisfaction guaranteed programs which helps it in promoting customers’ goodwill
         Wal-Mart tries to buy from local merchants when possible which helps it in keeping the price down
         Wal-Mart believes in stock ownership and profit-sharing with employees as it motivates them in working hard and keep up its good standard
         Furthermore its use of high technology and devices for better efficiency is one of its strong points as it helps it to compete in the world of advanced technology
         Wal-Mart concentrates on regular improvement programs for its employees which increases customer satisfaction
         Wal-Mart shows a better understanding and potential to manifest and reflect the very same feelings as that of the customers themselves. As during the economic downturn Wal-Mart devised an ingenious strategy of plummeting its prices so that the target market and potential consumers will not go disappointed from the store
         Positioning Strategy of Brands is also Wal-Mart’s strength as it convinces customers to believe that its offerings are different in some way from its competitors and it is an important benefit sought by the market
         Wal-Mart is the largest Super Store chain in the United States with approximately 5500 stores having annual revenue of more than $350 billion in the year 2006
         The prominence and differentiation strategy of Wal-Mart of reducing costs ultimately proved fetal for small as well as large competitors
         Shopping at Wal-Mart means not only saving money but also being patriotic, being a member of the community and a part of the "American Dream.”
         Wal-Mart’s other strength is its large employee base as it shows the capability of its management in keeping up such large employment opportunities.
         The company concentrates on covering most of the US market and therefore has a huge market share in US.
         Wal-Mart ensures that it has a variety of items to satisfy its customers to make the experience of shopping under one roof possible
         It sells 40% of private brands which are produced by contracts with manufacturers and adds to its uniqueness
·         Wal-Mart has no specific market, in fact its target audience encompasses everyone who is either a consumer or involved in the merchandizing business
·         Wal-Mart targets the blue-collar group and segment of society which encompasses those people who are always in search of getting the best quality product in the most affordable price coupled with a convenient location of availability. And as it fulfills their need it is very popular among them.

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