Wal Mart vs Target

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1. How big a threat Target is going to be to Wal Mart,Quantitatively & Qualitatively

Quantitative & Qualitative Analysis :Below are few factors that show Wal Mart's strong postion in market

As per case, at the close of 2004,one of Wal-Mart’s closet competitors, was Target $50 compared with Wal-Mart at $250 Billion. High Revenue shows the strong position of Wal-Mart.

Case mentions 55% of Wal Mart stores faced direct competition from Kmart stores and 23% from Target, whereas 85% of Target stores faced competition from Wal Mart.

Wal mart store devoted only 10% of its square footage to inventory than industry avg of 25%

Acc to data of 1993, Operating expenses of Wal mart were 18.1% of discount store sales in 1993 versus industry avg of 24.6%

Wal Mart "Always low prices-Always" has shown very clearly its strategy of low prices to end customers and attracted price sensitive customers

On the ground of prices Wal Mart’s Prices were 3.7% lower on average and 4.1%lower on items priced at all stores

Walmart's prices were roughly 1% lower ,when Wal Mart and Target were located next to each other and when separted by 4-6 miles Wal Mart Avg prices were Roughly 7.6% lower than Target

Data shows Wal mart has enjoyed a Quantitative competitive advantage over Target in early days

But

With the passage of time decison of Walmart aggresive store openings made its investors worried that wal-Mart had gone too far in seeking growth at the expense of return

Wal Mart ’s aggressive price competition took business from Target and others during the recession, as pressured consumers sought out the best bargains. But as the economy rebounds, Wal Mart is losing some of that momentum.  Competition from Target had become particularly acute as Wal-Mart expanded from rural market, which it had long dominated into relatively urban areas, where Target was historically strong ( Almost 45% of Wal-Mart stores were in rural or semirural counties, while...
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