Swot of Walmart

Topics: Wal-Mart, Hypermarket, Target Corporation Pages: 6 (1579 words) Published: October 12, 2013


Module 1: Google Case Analysis
Indian River State College
GEB 4930 - 185046 - Selected Topics in Management

Strengths
Scale of Operations
Low Cost Strategy
International Operations
Information Systems Technology
Weaknesses
Poor Human Relations
Implantation Of Entering International Market

Opportunities
Store Leasing
Green Operations
Rental Business
Retail Market Growth In Emerging Markets

Threats
Pending Lawsuits By Disgruntled Employees
Rising Commodity Prices
Strategies Are Being imitated

Strengths
Wal-Mart has many strengths that have propelled it to become the “largest retailer in the world with over $400 billion in revenue and 10,310 stores.” (Strategic Management Insight, 2013) One of its greatest strengths is actually in response to it being the largest. Wal-Mart’s scale of operations is the corner stone of all the strengths below. This strength allows them to carry 120,000-140,000 items within their stores and over 1,000,000 online. (Yoffie, D. & Slind, M, 2007) Wal-Mart’s low cost strategy is another strength that has pushed competitors aside. Wal-Mart has a low price guarantee which allows a cashier to match any price at the register. This strategy has eliminated a lot of the competition such as small Mom’s & Pop’s stores in small community’s as well as larger competitors like K-mart. Wal-Mart’s International Operations allows it to not only depend on its sales in the United States; in 2013 it earned $135 billion in other nations. (Strategic Management Insight, 2013) This strength helps to bring stability as well as great growth opportunities in developing nations. Wal-Mart’s information systems technology is a strength that holds the company together. Over a decade ago Wal-Mart trailed K-Mart due to its size but implementing a point-of-sale system and other technological advancements has lead it to be the largest retailer in the world.  “Over a five year period Wal-Mart invested over 600 Million in information systems”. (Prentice Hall Inc., 1999) This investment has allowed them to use only 10% of the floor space for inventory as compared to the industry average of 25%. (Prentice Hall Inc., 1999) Weaknesses

Wal-Mart, a multi-billion dollar business, has internal weaknesses that if left unaddressed will ultimately affect the strengths of the company. To begin with, Yoffie and Slind pointed out that, “Rising criticism of Wal-Mart’s business practices, particularly those pertaining to labor relations, contributed to a tarnishing of its image” (Yoffie & Slind, 2007, p.2).  Wal-Mart, throughout the years, has been accused of poor Human Relations; these accusations range from low wages paid out to employees to worker’s rights violations.  In recent years, Wal-Mart has faced an on slot of negative reports that indicate its policy of paying its employees low wages and the negative impact it has on its business are intertwined.  According to Rick Ungar, “Without enough employees to get the basic work of a retail operation done—and with those on site being paid a wage so low that it is difficult to expect much in the way of pride or motivation—Wal-Mart merchandise remains stacked on pallets in the warehouse rather than making it to the floor where customers can find the products they want” (2013).  Additionally, Wal-Mart has been linked to companies that have been suspected of using sweatshops for production of the products being sold by Wal-Mart.  Yoffie & Slind stated, “…Wal-Mart, in its relations with international suppliers, failed to enforce child-labor laws and worker-safety rules” (2007, p. 2).  This has led to a public outcry of support for the employees who have suffered Human Rights violations; consequently, this has contributed to a drop in Wal-Mart’s sales. The lack of proper planning by Wal-Mart has ultimately caused considerable financial losses associated with the cost of entering into some foreign markets, in addition to the long...

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Maestra, Nicole, (2010) Target seeks growth from small stores, overseas. Retrieved from:http://www.reuters.com/article/2010/01/21/target-idUSN2120840620100121
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SWOT analyses of Wal-Mart May 17, 2013 Retrieved From
http://www.strategicmanagementinsight.com/swot-analyses/walmart-swot-analysis.html
Willing, Richard (2001) USA Today, Lawsuits a volume business at Wal-Mart, Retrieved from: http://usatoday30.usatoday.com/news/nation/2001/08/14/walmart-usat.htm
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Van Dyk, P. (December 14, 2010). Wal-Mart Abandons Efforts to Enter Russian Market. Retrieved from http://www.npr.org/2010/12/14/132046158/Wal-Mart-Abandons-Efforts-To-Enter-Russian-Market
Wal-Mart
Yoffie, D., & Slind, M. (2007). Human Capital and Public Relations. In Dr. Frank Harber
Yoffie, D
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