INSEP Retail Management Batch 2
Case Study: Wal-Mart Entering Malaysia ( New Market Opportunities )
Prepared By : J.Kesol Matinggang
IC No : 840404-12-5283
Course Code: ECRM 101202
Prepared For : Mr. Machat Puthur Unnikrishnan
Due Date : December 3rd Monday
Table of Contents
a. Introduction of Company.
b. Objective of Walmart.
c. History of Establishment.
d. Mission and Vision.
e. Service Provided
f. Internal Organization Environment
* Target Market
* Market Segmentation – Demographic
* Potential Market Area
* Store Format
* SWOT Analysis
1.0 Introduction of Company
Walmart is the largest retail store in the US. It has over 3, 700 stores countrywide and many others internationally. Despite these positive results, there is a need for injection of new ideas in order to ensure that the retail giant sustains its position as a market leader. 2.0 Objective and Goals of Walmart
Walmart has always aimed at increasing sales through its friendly prices. This image has stuck with the company for a very long time. Not only is the company associated with low prices, but it has a variety of items under one roof. These qualities favor the rural clientele. The company is driven by a commitment to business excellence. This is seen by the quality of care accorded to customers once they report to their retail stores. This is ensured by the participation of employees in this business goal. The company has cultivated a culture of perfection in that they always want to be on top. The Company is driven by the pursuance of technological improvements. This is achieved through the use of new technologies in service delivery. Creativity and innovation is another business objective for the company. Through the efforts of their employees, the company aims at maintaining their market positions by brainstorming and looking for new ways of attracting potential clients. (MSNBC, 2007b) 3.0 History of Establishment.
Wal-Mart is a mega-retailer and its was founded by Sam Walton in 1962 in Bentonville, Arkansas. It started with $700,000 in its first year and scaled up to $5.4 million by 1974. The retailer continues to grow while others struggled with inflation and recessions. In 1980, Wal-Mart became the youngest US retailer to exceed $1 billion in net sales. During the 1980s, Wal-Mart began to further expand and thus pushing some retailers to closing some of their regional stores. The company engaged in diversification by creating membership-stores such as Sam’s Club, smaller, more conventional pharmacy/grocery stores called Neighborhood Markets, and finally Supercenters with a wide selection of consumer goods. And, in 1991, Wal-Mart became the world’s largest retailer.
In 2002, UBS performed an industry study and discovered that Wal-Mart had achieved 12% lower prices on average than its competitors. Wal-Mart had been able to implement its Every Day Low Price strategy by focusing on 1) developing a sophisticated logistics system with heavy information technology investments, 2) efficient distribution system by placing retail stores close to distribution centers and using RFID technology, and 3) being a non-union employer.
Wal-Mart was a relative latecomer to international retailing. It started in 1991 by opening two stores through a joint venture in Mexico. Then, by 1997, it had 41 stores in Mexico and had also expanded to Argentina, Brazil, China, Germany, Korea, Japan and the UK. In 2003, Wal-Mart now with 1,288 international stores had sales growth of 18.8% (above investor expectations) because of strong performance in Mexico, Brazil, and the UK. In Britain, Wal-Mart was able to successfully transplant their US strategy after acquiring ASDA. It implemented its supply-chain management technology and was able to provide...