‘the sacrifice of savings’ by luke meyer. background sam walton founded wal*mart in 1962 wanted...
TRANSCRIPT
‘The Sacrifice of Savings’
By Luke Meyer
Background
Sam Walton founded Wal*Mart in 1962
Wanted to have discount stores available to ‘small town’ folk
Believed in treating employees good
Walton had an intimate knowledge of the competition
Experienced intense growth in a relatively short time (stores in 47 states by 1994)
Wal*Mart Annual Sales
1/31/72 $44.0 Million
1/31/80 $1.2 Billion
1/31/92 $43.9 Billion
1/31/02 $217.8 Billion
S.W.O.T. Analysis (Strengths)
Guaranteed low prices of products
Substantial growth Convenience factor – wide
range of products all in one store and consumers are able to shop on-line
Hours of operation ‘Traiting’– making products
available based on customer preference
Location, location, location
Stengths Contd…
Intimate knowledge of the competition
Major contributor (see PDF of 2004 contributions)
Diversification of stores – Sam’s Clubs & Supercenters)
International Operations Proficient IT support –
tracks how products are performing store by store
S.W.O.T. Analysis (Weaknesses)
Hierarchal advancement – unequal opportunities
Early acceptance/use of micro-managing techniques
Low wages Benefits system –
unaffordable health care for employees
Weaknesses Contd…
Lack of flexibility –not as supple as specific product focused competitors
Immigration violations Closing down U.S.
plants Poor substitutes to
name brand products
Wal*Mart Greeter
Weakness or Strength???
S.W.O.T. Analysis (Opportunities)
Mergers – forming strategic alliances with other global retailers
Expand globally by implementing more stores overseas
Work on changing the anti-Wal*Mart attitude – ex. reverting back to the “Buy American” strategy
Having more products available to purchase on-line
S.W.O.T. Analysis (Threats)
Competition from other discounters
Concentrated price competition – outsourcing to low cost regions of the world
Remaining non-unionized Management complacency
– management is only promoted within their internal group
Threats Contd…
Being #1 makes you a target for publicity which is…
-Wal*Mart’s PR bloopers
http://money.cnn.com/galleries/2007/biz2/0701/gallery.101dumbest_wal art/index.html
-Wal*Mart, The High Cost of Low Price
http://www.walmartmovie.com/wmtv/
-The Daily Show on Wal*Mart
http://www.onlisareinsradar.com/archives/002392.php
not always a good thing
Recommendations
Re-evaluate internal and external values, policies, procedures etc.
Weed out bad management – those who employ unequal opportunities
Cut spending and invest in associates
Re-adopt buy ‘America Made’ (only 15% off all Wal*Mart products are made in the USA)