Case Study Solution: Wal-Mart Stores, Inc. Essays

1) Should Wal-Mart be expected to protect small businesses in the communities within which it operates?

Wal-Mart is a world-wide active American retail trade company and currently the largest retail company in the world. Beginning in 1962, Wal-Mart has made the transition from a small firm in Arkansas to the largest employer with 3, 800 store units in the United States with record revenues today. But nevertheless, since Wal-Mart launched its online branch, it had to suffer from substantial setbacks from competitors such as Amazon.com or Ebay.

Wal-Mart is arguably the most dynamic corporation in the last 50 years in the United States, if not the world. Arising from its beginnings in Bentonville, Arkansas, it has grown to over 4,400 discount stores, super centers and corner markets worldwide. Wal-Mart continues to expand despite public criticism of its labor practices as well as complaints about their treatment of competitors. The many strengths of Wal-Mart, like their low cost production and marketing practices, will aid Wal-Mart as it continues to grow in the retail

Walmart has three business divisions (Walmart U.S., Walmart International and Sam’s Club) in three primary store formats - Supercenters, Discount Stores and Neighborhood Markets. Supercenters are typically opened 24 hours a day and are known for their one-stop shopping experience. These stores offer the largest assortment products and services, combining disparate retail products like electronics, apparel, tools & hardware and jewelry. They also offer grocery (deli, bakery, pharmacy) services in addition to specialized services (check cashing, bill payment, automotive servicing) that would require visits to multiple vendors (What Kind, n.d.). Discount Stores are smaller than a Supercenter though with the restriction of limited hours and loss of the more non-retail services. Neighborhood Markets were designed for local communities and focus on groceries and pharmacy. Besides their brick and mortar establishments, Walmart also owns and operates Walmart.com and a propriatary mobile app for most smart phones.

Wal-Mart is the largest Discount Store in the United States. Its enormity is not only recognized domestically but also expanded to International Market. The company believes that one day this one will replace the United States position when the trend down (Molin, 2004). Being number one in the United States does not always guarantee for being number one elsewhere in the world. There are many problems that Wal-Mart is now facing in this highly competitive

Sam Watson the founder of Walmart once said “our people make the difference”. Walmart understands the importance of its human resource department. Its employees deal directly with its customers and this has an influence on the success of Walmart. The objectives and corporate goals of Walmart are cost reduction, saving money for on goods for its customers to live better and the acknowledgement that their success to a great extent depends on their employees. The human resource functions that Walmart has put in place to be in line with its business objectives are its retention programs/strategies, internal promotion and career development and compensation.

According to the news from the “THE AMERICAN PROSPECT” (23/04/2013) the problems arise in Walmart Company by workers fight back:

Ever since Wal-Mart started it has taking off not only nationally but internationally, especially over the past ten years. Wal-Mart has become the world’s largest and probably the most powerful retailer to this day, having the highest sales per square foot. The major keys to Wal-Mart’s success is due to their inventory turnover, operating profits, providing discounted prices to their customers, and of course their supply chain. Through all of those, Wal-Mart says that it focuses on change, technology, and effective management to lower cost all across the board. Wal-Mart’s incredible supply chain, as shown in the case with its seafood, but with all of its products is where most of their ability to lower product

Wal-Mart sale is in high volume with each geographical location where it has a subsidiary receiving an equal share of the required products to supply. The subsidiaries in Europe receive the largest number of sale compared to the rest of the branches. Africa has only one subsidiary in South Africa and thus registers the lowest number of purchase compared to other branches. However, the general number of sale recorded by Wal-Mart is high because the company has gained a lot of market share in the world. Economic survey indicates that Wal-Mart is the largest company in sales and that registers the highest volume of revenues in the world (Kendall & Gerald 1998).

In terms of products, Wal-Mart does not offer any differentiation as compared to its competitors . Thus it cashes majorly on the low prices it offers. This could be effected if the average consumer 's income levels increase as the major cost leadership strategy Wal-Mart practices will not be as effective any more. Wal-Mart 's strategy which is based on a model that consists of selling a range of low- and higher-end goods at a very low markup. The low markup means that in

Wal-Mart Stores Inc, is the largest retailer in the world with a bullseye on its back from competitors taking aim in all different directions from supermarkets cutting prices to match Wal-Mart’s price, to Costco leading the warehouse market and online retailer beating out Wal-Mart.com. In addition, 2008 brings an economic slowdown and a reduction of feet through the doors of Wal-Mart Stores. Added to this, Wal-Mart has received negative publicity relating to employee compensation and benefits, forcing suppliers to cut prices which result in jobs moving from the US overseas to meet the demands of Wal-Mart and moving into areas putting locally owned retail outlets out of business. Wal-Mart has over 6,8001 stores worldwide with a strong internet presence with a wide product selection. Wal-Mart is support by over 66,000 suppliers worldwide offering products in numerous departments including pharmacy, grocery, hard and soft goods, electronics, pet, health and beauty and more.

Wal-Mart Stores, Inc. is the largest corporation in the world that specializes in selling goods at the lowest possible price. Having low prices attracts more customers and results in an increase in total profits even though, the markup per product is at bare minimum (Press 2004). Walmart’s products include food, beverages, home products, personal care products, toys, clothing, electronics, and much more (Walmart 2016). Walmart’s stock of such a large variety of products makes it one of most useful retail company for an everyday consumer. This and the willingness to expand and innovate is probably why Walmart is so successful today.

Wal-Mart Stores, Inc. also referred to as Walmart is the company that I am going to research for my proposal. The company website is www.walmart.com and the corporate website is www.corporate.walmart.com.

The key financial commitments that the company must make are the following ones. In fact, for sound financial management of the company, decision makers of Wal-Mart should develop consistent tools. They have to find both forecasting tools and control tools. Indeed, forecasting tools are tools that are based on objectives to achieve. In general, it is made by the internal workers to the company to guide those responsible for achieving the financial objectives of the company. Moreover, the control tools will allow to account for the situation of the company at a given time. These are boards set up by the financial team the company that will give to the company a reflection of its situation in comparison to the sector. Moreover, the performance of Wal-Mart is directly related to the performance of women and men who compose it. A priority of the company is therefore to develop a strategy for managing human resources. Good human resource management involves knowing the precise allocation of human resources, to promote their optimization in order to mobilize and develop them to achieve increased efficiency and productivity. The ability of Wal-Mart to manage its human resources effectively and mobilize its staff to achieve its objectives will depend to its extent on its ability to develop and implement a plan. This plan, on the one hand, will create an environment that will allow an attraction, retaining and the motivation a staff technical expertise and the high performance.

Yes, I do believe Wal-Mart is doing enough to become more sustainable. Wal-Mart is one of the most powerful companies internationally. As with all things that come with power, Wal-Mart’s business practices are scrutinized thoroughly. This includes their relationships with suppliers, employees, consumers, and the environment. In recent years, the environment has become such a big issue that Wal-Mart, as well as other companies have had to respond to this growing concern.