The first Wal-Mart store was opened on July 2nd 1962 in Rogers, Arkansas by Sam Walton, who believed that the future of retailing lay in discounting. To avoid competing head on with companies like Sears and Woolworths which dominated big cities, Walton opened stores in less populated areas that was ignored by other retailers. The stores aimed to serve customers who, up until then, had to travel long distances to save money, and to purchase daily household goods. Now they could buy the same goods cheaply at home. This positioning proved to be critical to Wal-Mart’s success in the years to come as it expanded underneath its competitors radar screens to earn substantial market size. (Farhoomand, 2005)
In the first year of operation, sales at Wal-Mart stores were US $975,000. Ten years later, when the company was listed on the New York Stock Exchange in 1972, revenues had reached US $78million. The public listing provided the company with the resources to finance a more rapid expansion, and by 1979 sales had surpassed US $1 billion. The unbelievable growth was unstoppable. In 1990, the company topped the list of major retailers in the US. And five years later, Wal-Mart stores could be found in all 50 American states, in Mexico and Canada. In 2002 it became the world’s largest company in terms of sales. On January 31st 2005, Wal-Mart Stores reported net sales of US $285 billion, and had a presence in nine countries with 5,289 stores and 1.6 million employees worldwide. Wal-Mart offered multiple store purchasing options that included discount stores, supercentres, warehouse stores and neighborhood markets. Wal-Mart not only the largest company in the world, but also the most admired company in the US according to Fortune magazine. (Farhoomand, 2005)
Many attributed Wal-Mart’s success to its model of selling brand name products for less. Wal-Mart’s founder and its executives did not invent the rules of discounting. When Sam Walton opened the first...
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