‘The Sacrifice of Savings’ By Luke Meyer Background Sam Walton founded Wal*Mart in 1962 Wanted to have discount stores available to ‘small town’ folk Believed in treating employees.
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Transcript ‘The Sacrifice of Savings’ By Luke Meyer Background Sam Walton founded Wal*Mart in 1962 Wanted to have discount stores available to ‘small town’ folk Believed in treating employees.
‘The Sacrifice of Savings’
By Luke Meyer
Background
Sam Walton founded
Wal*Mart in 1962
Wanted to have discount
stores available to ‘small
town’ folk
Believed in treating
employees good
Walton had an intimate
knowledge of the
competition
Experienced intense
growth in a relatively short
time (stores in 47 states by
1994)
Wal*Mart Annual Sales
1/31/72
$44.0 Million
1/31/80
$1.2 Billion
1/31/92
$43.9 Billion
1/31/02
$217.8 Billion
S.W.O.T. Analysis (Strengths)
Guaranteed low prices of
products
Substantial growth
Convenience factor – wide
range of products all in one
store and consumers are
able to shop on-line
Hours of operation
‘Traiting’– making products
available based on
customer preference
Location, location, location
Stengths Contd…
Intimate knowledge of the
competition
Major contributor (see PDF
of 2004 contributions)
Diversification of stores –
Sam’s Clubs &
Supercenters)
International Operations
Proficient IT support –
tracks how products are
performing store by store
S.W.O.T. Analysis (Weaknesses)
Hierarchal
advancement –
unequal opportunities
Early acceptance/use
of micro-managing
techniques
Low wages
Benefits system –
unaffordable health
care for employees
Weaknesses Contd…
Lack of flexibility –not
as supple as specific
product focused
competitors
Immigration violations
Closing down U.S.
plants
Poor substitutes to
name brand products
Wal*Mart Greeter
Weakness or Strength???
S.W.O.T. Analysis (Opportunities)
Mergers – forming strategic
alliances with other global
retailers
Expand globally by
implementing more stores
overseas
Work on changing the antiWal*Mart attitude – ex.
reverting back to the “Buy
American” strategy
Having more products
available to purchase online
S.W.O.T. Analysis (Threats)
Competition from other
discounters
Concentrated price
competition – outsourcing
to low cost regions of the
world
Remaining non-unionized
Management complacency
– management is only
promoted within their
internal group
Threats Contd…
Being #1 makes you a target for
publicity which is…
-Wal*Mart’s PR bloopers
http://money.cnn.com/galleries/2007/biz2/0701/gallery.101dumbest_wal
art/index.html
-Wal*Mart, The High Cost of Low Price
http://www.walmartmovie.com/wmtv/
-The Daily Show on Wal*Mart
http://www.onlisareinsradar.com/archives/002392.php
not always a good thing
Recommendations
Re-evaluate internal and
external values, policies,
procedures etc.
Weed out bad
management – those who
employ unequal
opportunities
Cut spending and invest in
associates
Re-adopt buy ‘America
Made’ (only 15% off all
Wal*Mart products are
made in the USA)