Description
This presentation is about how does Walmart compete, how does walmart differentiate from other retailers.
Case Study
• • • • •
Incorporated in 1969 by Mr. Sam Walton First store opened in Bentonville Arkansas World’s 18th largest public corporation Largest retailer in the world Has around 8500 stores in 15 countries under 55 different names • Headquarters – Bentonville, Arkansas • Revenue (2012) – USD 446.95 bn • Employs around 2.2 mn people
How does Wal-Mart Compete
• Walton knew the competitors intimately – He had visited the competitors, observed their strategies and tried to implement the good ones • Pricing in local market was based on competitors distance 2.2% below KMart 3.7% below target • Trip expense less than 1% of purchases • 70% store operation leased
How does Wal-Mart Compete
• Strong inbound & outbound logistics. Also, at times providing with accelerated delivery plan • 1993 P&G the largest customer – USD 3bn business, 10% P&G revenue • Employees – Associates • Associates – Profit sharing, stock ownership, incentive compensation, relocation • Constant visit by management from Bentonville to stores
How does Wal-Mart differentiate from other retailers?
• Less advertising expense 1.5% of discount store sale compared to competitors 2.1% • Nationally advertised branded products • ‘Buy American’ strategy in 1985 • WalMart stores build with an intent on expansion • Less operating expense 18.1% of discount store sales against industry average of 24.6%
How does Wal-Mart differentiate from other retailers?
• Satellite system to reduce shrinkage • Automated distribution centre • Inbound Logistics – 3.7% of discount store sale as against 4.8% of direct competitors • Centralized buying • EDI, Electronic Invoice, EFT • Daily sales data available to the vendors • Management consisting of people who have been working with Walmart for years
How does Wal-Mart differentiate from other retailers?
• Diversification which included 1. Sam’s Club 2. Deep Discount Drugstore 3. Helen’s Art & Craft store 4. Hypermarket 5. Bud
Will Wal-Mart continue to win?
• It has the best know how to provide the right set of products to the right set of customers • Customers are also hungry for new ways of shopping • Product cost – Low • Delivery response time – Low • Product variety – High • Product quality – Moderate-High
doc_890505195.ppt
This presentation is about how does Walmart compete, how does walmart differentiate from other retailers.
Case Study
• • • • •
Incorporated in 1969 by Mr. Sam Walton First store opened in Bentonville Arkansas World’s 18th largest public corporation Largest retailer in the world Has around 8500 stores in 15 countries under 55 different names • Headquarters – Bentonville, Arkansas • Revenue (2012) – USD 446.95 bn • Employs around 2.2 mn people
How does Wal-Mart Compete
• Walton knew the competitors intimately – He had visited the competitors, observed their strategies and tried to implement the good ones • Pricing in local market was based on competitors distance 2.2% below KMart 3.7% below target • Trip expense less than 1% of purchases • 70% store operation leased
How does Wal-Mart Compete
• Strong inbound & outbound logistics. Also, at times providing with accelerated delivery plan • 1993 P&G the largest customer – USD 3bn business, 10% P&G revenue • Employees – Associates • Associates – Profit sharing, stock ownership, incentive compensation, relocation • Constant visit by management from Bentonville to stores
How does Wal-Mart differentiate from other retailers?
• Less advertising expense 1.5% of discount store sale compared to competitors 2.1% • Nationally advertised branded products • ‘Buy American’ strategy in 1985 • WalMart stores build with an intent on expansion • Less operating expense 18.1% of discount store sales against industry average of 24.6%
How does Wal-Mart differentiate from other retailers?
• Satellite system to reduce shrinkage • Automated distribution centre • Inbound Logistics – 3.7% of discount store sale as against 4.8% of direct competitors • Centralized buying • EDI, Electronic Invoice, EFT • Daily sales data available to the vendors • Management consisting of people who have been working with Walmart for years
How does Wal-Mart differentiate from other retailers?
• Diversification which included 1. Sam’s Club 2. Deep Discount Drugstore 3. Helen’s Art & Craft store 4. Hypermarket 5. Bud
Will Wal-Mart continue to win?
• It has the best know how to provide the right set of products to the right set of customers • Customers are also hungry for new ways of shopping • Product cost – Low • Delivery response time – Low • Product variety – High • Product quality – Moderate-High
doc_890505195.ppt