Walmart Corporate Strategy South Africa

Topics: Wal-Mart, Retailing, Discount store Pages: 17 (5449 words) Published: August 21, 2012
Question One:
Identify an organisation of your choice and provide a brief description of the organisation in terms of issues such as history, industry, products and services.

Walmart was founded in 1962, with the opening of its first store in Rogers Arkansas. In 1969 the company was incorporated as Wal-Mart Stores Incorporated. In 1970 the company was floated on the New York Stock exchange. By 1980 the company had 276 stores in 11 states under the Wal-Mart banner. The first store that was opened outside of the USA was near Mexico City in 1991. This signalled the start of Wal-Mart being an international company. Currently Wal-Mart operates in 27 countries under 69 different banners. We recently saw the acquisition of Massmart in South Africa which incorporated the Game, Dion Wired, Makro and Builders Warehouse group of companies. For the financial year 2011-2012 the Wal-Mart group turnover was approximately $444 Billion. Wal-Mart employs +- 2 million people worldwide at its stores. This makes it one of the largest companies in the world and the largest in the retail sector. The industry that Wal-Mart trades in is retail direct to the public. Wal-Mart sells high end electronic goods as well as general consumer goods. Groceries are high on the list of products sold in Wal-Mart and constitute a large percentage of the turnover done by the company. The greatest attribute to the success of the Wal-Mart group is their logistic knowledge. By shortening the link between the consumer and supplier Wal-Mart is able to deliver the same goods as other retail outlets but at a much lower cost to the consumer. This is a founding principle of the founder of the Wal-Mart group. Mr. Sam Walton stated that “If we work together, well lower the cost of living to everyone, we will give the world an opportunity to see what it’s like to save and have a better life” Keeping his philosophy in mind, the entire Wal-Mart group operates under these principles. By increasing the buying power of the company year on year, Wal-Mart is able to purchases larger quantities of goods than any of its opposition companies. Therefore Wal-Mart has changed the global manner in which business is conducted. With its considerable buying power Wal-Mart is able to dictate pricing to suppliers which in turn has financial benefits for the company and its consumers. There is however other benefits to the size of Wal-Mart. With increased pressure on the retail/consumer industries to Reduce, Re-use and Recycle packaging and packaging related products, Wal-Mart was one of the first companies to step up. With innovative partnerships with their suppliers they have managed to reduce their carbon footprint on the environment and as this is an on-going iniative it will have a positive impact on the environment. Note: Wal-Mart Incorporated is the listed name of the entity. In general terms the company is referred to as Walmart.

Question Two:
Using their (the organisations) current Mission Statement conduct and External as well as Internal analysis in order to identify their Strengths, Weaknesses, Opportunities and Threats. The EFE and IFE Matrices have to be used for the analyses. Walmart Mission Statement:

“If we work together, we’ll lower the cost of living for everyone. We’ll give the world and opportunity to see what it’s like to save and have a better life.” Sam Walton (Founder of Walmart) This credo has been the basis for Walmart expansion not only in the USA, but also in other parts of the world. We recently saw the acquisition of local Massmart as part of the Walmart stable. The greatest drive within Walmart is to lower costs paid to suppliers thereby passing on these cost savings to their customers. With this principle they also create greater brand loyalty amongst their customers as the perception and understanding from their consumers is that you will always find lower prices at Walmart and there is little reason to shop around as Walmart company slogan...
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