Analysis of Wal-Mart’s Competitive Advantages in International Expansion and Problems

7313 WordsAug 17, 201230 Pages
Analysis of Wal-Mart’s Competitive Advantages in International Expansion and Problems 1. Introduction 1. General information of Wal-Mart The first opening of Wal-Mart Stores was founded by American retail legend Sam Walton in Rogers, Arkansas in 1962. On Oct. 31st, 1969, the stores were incorporated as world famous Wal-Mart Stores, Inc. Almost forty-four years later, Wal-Mart served more than 176 million customers per week, and became No. 1 retailer in the United States. And, it is now the world’s largest private employer and retailer with over 1.9 million associates worldwide and more than 6,800 stores in 14 countries, including Canada, China, Germany and Britain, etc. In the year of 2001, 2002 and 2003, Wal-Mart topped Fortune 's…show more content…
Distribution centers have the responsibility to sift, pack and check the goods. The centers are equipped with advanced machinery, and about 85% of the goods have been sent by machine, which largely save the cost of manual labor. At the same time, because of the huge amount of goods and fully use of machinery, the advantage of scale-merit can be enjoyed in the entire operating process. • The Efficient Transportation System. An incomparable vehicle team exists in this system. In 1996 when Wal-Mart had over 30 distribution centers, more than 2000 trucks guaranteed goods transportation from warehouse to warehouse in less than 48 hours. As one of the exciting results, compared with other stores replenishing inventory once every two weeks, Wal-Mart could do the same thing twice a week. Rapid delivery made sure that very single branch of Wal-Mart could maintain its business, even if stock of each branch was very low, which greatly saved the storage space and relative expense. Now over 85% of Wal-Mart’s goods are transported through its own distribution centers by about 7.100 trucks. As a positive result, Wal-Mart’s sales cost is 2%--3% lower than average sales cost in the same industry, which turns out to be the fundamental base for the “Every Day Low Prices”. (2) Advanced Technology Wal-Mart has the incomparable advanced technology, i.e. its own worldwide web connection, an advanced satellite worth USD 4 billion. This highly-cost satellite communication

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