Wal-Mart Business Report

Topics: Wal-Mart, Retailing, S. Robson Walton Pages: 7 (1993 words) Published: May 10, 2008
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The purpose of this business report is to gain familiarity with Wal-Mart and to learn about the different aspects that make Wal-Mart a successful company. This report gives an in-depth analysis of the company history, services and products provided, the company philosophy, business methods, organizational structure, and financial and competitive analysis.

Wal-Mart is a well-known company. Although Wal-Mart was originally just a retail outlet, this company has extended its reach to far greater areas of service and products including Tire shops, Photo shops, and Pharmacy’s.

These findings show that the company is doing very well. The financial statements look good and the company is profitable considering the industry averages. Therefore, it is recommended that investors consider this company for their investment portfolio.


The first Wal-Mart store opened in Rogers, Arkansas in 1962. The founder of Wal-Mart is a late 1940’s retailer by the name of Sam Walton. Walton was said to be a cheap man, and would cut corners and save money wherever possible. That is how his idea to pass the savings on to the customer came to be. He knew he could save money like other retailers by making deals with suppliers, but he also knew that if people could experience the savings more directly the sales volume would increase and he could still make a profit. Walton wanted to earn his profits through volume. And it didn’t stop at deal making with suppliers and passing it on to customers. There has been plenty of publicity about Wal-Mart wages for cashiers, but even Wal-Mart executives were subjected to the cost-cutting ways of Sam Walton when it came to business trips.

In 1985 though, Walton knew he had to let his penny-pinching ways sit on the back burner. There was anxiety about trade deficits the loss of American manufacturing jobs, so Walton “launched a ‘Made in America’ campaign that committed Wal-Mart to buying American-made products if suppliers could get within 5 percent of the price of a foreign competitor.” By doing this, Walton showed customers and employees alike that the company has a conscience. Not only that, but even earlier Walton gave profit-sharing rights to employees in 1971. And as evidenced by the stock growth, that wasn’t a bad investment.

Wal-Mart didn’t just get by with cost-saving methods. They were ahead of their competitor’s technology wise too. Even in the 1970’s, Wal-Mart was able to track inventories in their warehouses and link it with stores. They tracked their sales data for specific items and could increase or decrease their inventory accordingly, achieving a higher efficiency than other retail companies. Another aspect that Wal-Mart felt strongly about was expanding there reaches. In 1978, they introduced a Pharmacy, auto center and jewelry divisions.

When Sam Walton died in 1992, the company was taken over with the same cheapness in mind. Only, the new leaders at Wal-Mart didn’t show the employees that they were still important. This lead them to make unrealistic demands of local managers and it didn’t reflect on the payroll, leading to serious problems for the company. Those problems have been publicized by Dateline, in documentaries, and Washington also got involved. The reason being, Wal-Mart is such a giant on the retail sector, that the way it does business, affects the way other retailers do business. So, while critics focus on the company’s low wages, meager benefits its reliance on outsourcing (despite its Made in America campaign), and it’s effects on small towns, Wal-Mart’s low prices are still enough to keep customers coming in and making them...
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