Students Expectations from Professors

Topics: Marketing, Kmart, Discount store Pages: 13 (1731 words) Published: January 19, 2013
Executive Summary

Wal-Mart , the retail giant is growing leaps and bounds and ahead of the competitors domestically and internationally. Wal-Mart is ahead of Target , K-Mart and other regional players. The aim of Wal-Mart is to meet the basic needs of customer, with low price always in spite of not having the formal mission statement. Wal-Mart is looking at emerging markets, particularly Asia. Wal-Mart has the price leadership in domestic and international market to compete with the industry players. The leader in the whole retail market is expanding aggressively to have a more market base in addition to 4258 stores (US) and 3615 (Int’l.).

The formal mission statement will help Wal-Mart to tackle the penetration and political and legal environment in the new markets. Internal and External factors evaluation will help us to understand Wal-Mart SWOT and their position in the retail market periodically. The Market Penetration and Product development strategy(4 different store concepts) factors will play a vital role for relative market growth and market shares

Mission Statement

Wal-Mart does not have a formal mission statement.

It believes ‘the customers are most interested in other aspects of business and Wal-Mart is concerned in meeting their basic needs’.

III. Strategic Problems

* In response to the criticism of paying lower wages to its employees, Wal-Mart supported president Obama’s effort to provide near –universal coverage to Americans and announced publically to provide health care benefits to its low income, part time employees without analyzing its capability to do so. This in the later years proved to be expensive and short lived.

* Wal-Mart’s old fashioned policies – store policies forbid employees from dating other employees without approval from executive committee, also women were rarely seen in management positions. Wal-Mart managed to change these policies and is now a Equal Employment Opportunity/Affirmative Action (EEO/AA) employer

* Predatory pricing: Wal-Mart’s policy allows store managers to monitor and price the products competitively without being concerned about the costs.

* “Buy American” policy – Wal-Mart plans to capture the local market by using “Buy American” in their ads while importing goods from labor intensive countries.

IV. Strategic Objectives:

* To pay its part time employees with wages specified in wages and fair labor Standards Act

* Bringing in more women in top management, and encouraging potential women employees by providing respective training quarterly or yearly.

* Keep their pricing decisions aggressive yet meet the legal laws without affecting the firm’s brand image.

* Avoid the usage of “Buy American” campaign as mere promotional activity and make a choice between global supplier imports (essential for competitive pricing) and maintaining the “Buy American” image.

External Audit

Industry Analysis: Five Forces Model

Threat of New entrants:

Threats from new entrants are minimal as they have

• gained economies of scale

• Exceptional distribution systems, brand name, and location.

• Better financial stability of the company than the competitors.

• ‘Meet or Beat ‘pricing policy of Wal-Mart. Advantage over the price compared to the competitors.


• The rivalries in the retail market are Sears Holdings (K-Mart), Target. The fierce competitor and second to Wal-Mart is Target.

• Growth of Target with its more upscale and fashionable merchandise than Wal-Mart.

• K-Mart, under new management is competitive in the third place.

• Costco in the wholesale club segment is tough competitor to Wal-Mart’s Sam’s Club division and is ahead of Wal-Mart.

Buyer Power:

• Buyers do not/have minimal bargaining power as Wal-Mart offers the lowest priced products.

• Purchasing...
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