The Wal-Mart Case: Case Study Analysis
Introduction
Walmart is one of the biggest retail corporations based in the U.S. The founder Sam Walton founded the company in the year 1962. Since then, the company has always thrived and achieved a market-leading position not just in the country but among several countries around the world. The company has achieved this eventual success with a lot of hard work involved, implementation of effective operational strategies, and keeping the company’s operations up to date. Following effective approaches, the company reported about 514 billion USD of revenues in the year 2019 with 4.2% sales growth and achieved 3.9% growth in its shares.
Situational analysis
Question no. 1
A) Among many other operational strategies, Walmart’s supply chain capabilities were indeed its competitive advantage because of its eventual development. The company has always been effectively using its resources to achieve it is supply chain objectives. When Walmart was founded in the year 1962, the company founder Sam Walton, who was also the owner of a variety of stores in the country, used to purchase inventories in bulk only to transport them to his stores. As compared to its competitors, Walmart’s distributive operations were always smooth, and it never relied on external sources to accomplish it is supply chain goals. Also, because of effective supply chain strategies, the company has successfully achieved cost reductions, lower costs on its products, low merchandise carrying costs, implementation of competitive price strategies, integrative logistics, and bringing variety to its stores.
As compared to Amazon, which had 75 and 25 fulfilling and sortation centres respectively in North America, Walmart had its stores spread over 90% of the country’s population within ten miles distance.
B) Walmart’s supply chain capabilities could be determined from the following examples.
In the year 1962, when the founder Sam Walton started the Walmart stores, he used to purchase the merchandise in bulk quantities, and then it was directly delivered to the overall stores. Purchasing the merchandise in bulk enabled cost efficiencies for the company and several major costs were cut down because of it, like freight charges, etc.
Walton opened ‘Walmart discount city’ to compete with the competitors who were using low pricing strategies and selling their products at discounts to appeal to a higher number of customers. The company started its own distribution channels to cut costs and supply its products at discounts to its customers.
Question no. 2
The company is successfully achieving growth objectives and paving its way towards success. That is why the company recorded leading revenues in the year 2019 and became the number one grocery retailer of the company. As compared to its competitors, Walmart is doing great. The company’s major competitors are Amazon, Ikea, Target Home Depot, Aldi, Costco, Walgreens, CVs, and Kroger. Walmart effectively competed with all of its competitors and became the top grocery retailer in the country for the year 2019. The company used counter-strategies to any strategies implemented by its competitors. It always focused on the latest marketing trends to get maximum sales growth. When the company’s competitors were using low pricing strategies and selling their products at discounts to appeal to a higher number of customers, Walmart launched ‘Walmart Discount city’ to target customers looking for discounted items. Besides that, the company has shifted its focus toward the online retailing business because of its trending matrices.
Question no. 3
The biggest challenge that Walmart is currently dealing with is regarding decisions and changes to manage the company’s increasing supply chain and achieve its ultimate goals. The company has shifted its core focus from offline to online retailing business in order to effectively compete with its competitors and prevail to be the market leader. With all these approaches, the company requires several changes to be made because of increasing supply chain requirements. With effective inventory management, safe home deliveries, effective supply, and demand logistics, and making online operations smooth, the company requires taking many decisions and remain up to date with its operations.
These implications of the supply chain occurred because the company shifted its focus to the online retailing business so it expanded its overall operations and brought changes to business dynamics. With the focus only on offline retailing, the company proved its supply chain capabilities with timely strategies and sufficient growth measures and their successful implementations and achievements. Hence, in order to prevail in its market-leading position ,the company must take various decisions and bring changes to improve its ever-expanding supply chain dynamics....
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