Walmart Case

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Summer

Summer

National Economic University – Hanoi - Vietnam
National Economic University – Hanoi - Vietnam
08
Fall
08
Fall

Wal-Mart Case
Wal-Mart Case

Dam Thi Thu Quynh
CQ502184
Advanced program
Intake 50

Dam Thi Thu Quynh
CQ502184
Advanced program
Intake 50

Question 1:
What impresses you about this company? What accounts for Wal-Mart’s success over the past 25+ years? Is it a great strategy, superb strategy implementation and execution, or great leadership? What aspects of Wal-Mart do you find unimpressive? In my opinion, there are at least 3 things that I should be impressed about Wal-Mart. * No match rivals: In early 1990, Wal-Mart tested selling grocery, food as well as commodity goods in the form so called “supercenter”. During this time, grocery industry had been governed by a chain of famous international supermarket. However, after 10 years, until the end of 2000, Wal-Mart had breakthrough and became the number one food retailer in America. * Sweep and annexation: As a retail group, Wal-Mart is not only the biggest but also the strongest and barely no match rivals. It is bigger than Home Depot, Target, Costco, Kmart, Kroger and Sears combined. Wherever Wal-Mart store is located, it is a threat to local supermarket and discount stores. It is also the potential and irresistible customers for some suppliers. * One of the economic indicator of America: In the daily news, the name Wal-Mart is highlighted in over 100 articles. Each month, revenue of Wal-Mart becomes the subject to be mentioned every 24 hours. Everybody concern with what is happening to Wal-Mart due to the fact that its business performance is consider a key indicator of United States economic trends in general. It is obvious that Wal-Mart must have its own characteristics to make it strong and invincible like today. From what I have collected, I believe that it is the combination several factors including: good strategy, good implementing and executing and good leadership. * Good strategy: Before 2006, Wal-Mart has been always after providing lower price for customers. It does not necessarily mean that Wal-Mart offer products with lower quality. In fact, they offer the same products like competitors, but with much lower price. That is the reason why the market share of other successful companies at that time has been taken away by Wal-Mart. From 2006, realizing the importance of the ethics and global environments, as well as the continuous bashing happened to the company, former CEO of Wal-Mart decided to make a transformation. Replacing the old slogan of, the new slogan now includes “ live better”. This means, not only providing lower price, Wal-Mart also concern about the living of the society and community as a whole. * Good implementing and executing the strategy: In order to make the “ same goods, lower price”, Wal-Mart knows exactly what they have to do. Firstly, in the relationship with suppliers, they closely watch the manufacturing process and determine a reasonable mark up that suppliers can charge. With Wal-Mart, there is no such thing as “funny pricing”. Even though Wal-Mart offer those suppliers with lower price than the others, they cannot turn down on Wal-Mart because Wal-Mart contributes about more than 20% of their total sales. Certainly, lowering price from the suppliers is not enough. Wal-Mart also closely watch on every steps of the value chain and apply the modern technology to increase productivity and drive cost down. From 2006, in order to make the transformation, Wal-Mart has done several things such as: continue to improve the service quality in Wal-Mart, increase green merchandise offering, switch to renewable energy, providing a better work environment, etc. All of this actions have proven to be effective as in 2008, in front of shareholders, Wal-Mart CEO declared that he was quite satisfy with the result of the transformation. * Good leadership:...
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