Wal-Mart Stores, Inc.
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Introduction Wal-Mart Stores , Inc., Inc., branded branded as Walmart Walmart is an American American multinational multinational retail corporation that runs chains of large discount department stores and warehouse stores. The company is the world's the world's second largest public corporation, according to the Fortune the Fortune Global 500list 500l ist in 2013, the biggest the biggest private employer in the world with over two million employees, and is the largest retailer in the t he world. Walmart remains a family-owned business, business, as the company is controlled by the Walton the Walton family, family, who own a 48 percent stake in Walmart It is also one of theworld's theworld's most valuable companies.
The company was founded by Sam by Sam Walton in 1962, incorporated incorporated on October 31, 1969, and publicly traded on the New York Stock Exchange in 1972. It is headquartered in Be in Bentonvi ntonville, lle, Arkansas. Arkansas. Walmart is also the largest grocery largest grocery retailer in the United States. In 2009, it generated 51 percent of its US$258 billion sales in the U.S. from grocery business. It also owns and operates the Sam's the Sam's Club retail Club retail warehouses in North America.
Walmart Whelps people around the world save money and live better anytime and anywhere in retail stores, online and through their mobile devices. Each week, more than 245 million customers and members visit our 10,900 stores under 69 banners in 27 countries and ecommerce websites in 10 countries. With fiscal year 2013 sales of approximately $466 billion, Walmart employs 2.2 million associates worldwide.
Find out how innovative thinking, leadership through service, and above all, our commitment to saving people money so they can live better have made us the business we are today and and are shaping shaping the company company we will be tomorrow tomorrow
Walmart operates more than 10,900 retail units under 69 banners in 27 countries and e-commerce e-commerc e websites in 10 countries. We employ 2.2 million associates around the world — 1.3 1.3 million in the U.S. alone.
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Mission
We save people money so they can live better
It’s our mission to create opportunities so people can live better. We consider it
our responsibility to make a positive impact in the communities we serve. Whether it’s through the grants we provide to the thousands thousands of organizations organizations
that share our mission or through the inspiring volunteer efforts of Walmart associates, we are passionate about helping people live better. One community at a time.
Saving people money to help them live better was the goal that Sam Walton envisioned when he opened the doors to the first Walmart ®. This focus drives everything we do at Walmart. And, for the millions of customers who shop in our stores around the world each week, it means they can trust that our brand means we have every day low prices.
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Vision
Our vision is to provide good quality and services to our customers while remaining the market leader and striving daily to be the most admired company.
The secret of successful retailing is to give your customers what they want. And really, if you think about it from your point of view as a customer, you want everything: a wide assortment of good-quality merchandise; the lowest possible prices; guaranteed satisfaction with what you buy; friendly, knowledgeable knowledgeable service; convenient hours; free parking; a pleasant shopping experience." - Sam Walton (1918-1992)
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Board of Directors
Strong corporate governance is essential for a successful business, and our board members members ensure ensure Walmart operates operates with integrity integrity and accountability. accountability. Learn more about our corporate our corporate governance governance policies and read our Statement Statement of Ethics.
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Growth Strategy The retail giant is dropping its high-end strategy to focus on securing the loyalty of its base with services such as health care, banking, and broadband broadband access Rural America, Wal-Mart wants you back. Gone is the focus on trendy fashions, 400-thread-count sheet sets, and snooty ads in glossy fashion mags designed to appeal to a higher-income demographic that rarely shopped at the store anyway. These days, Wal-Mart Stores (WMT) is making a big push to woo back its core audience with a strategy based not just on price cuts, but on a more holistic approach with deeper and broader services aimed at its core customers. The latest offer is high-speed Internet access, a costly proposition in many remote corners of the country. On Oct. 9, Hughes Network Systems (HUGH) announced it will sell satellite broadband at Wal-Mart stores. The satellite broadband broadban d offering at 2,800 stores is just the latest in a litany of services the retail giant has rolled out this year. Clearly, Wal-Mart has struggled to revive sales. Through Aug. 31, sales at U.S. stores open at least 12 months have grown a mere 0.8%, putting the company on track for its worst sales year in history. That pace would be even slower than the 1.9% same-store sales increase in 2006, which was already Wal-Mart's record worst performance. Overall sales growth is also slowing: Last year total revenues jumped 11.7%, and analysts estimate an 8.4% increase for this year. 1. Benefits to Brand and Image
What the service effort will do, everyone agrees, is help Wal-Mart secure customers who are more loyal. Providing its core base with greater services — especially in areas where they are underserved — could could cement Wal-Mart's 6
strength with its audience. "It plays to their sweet spot in terms of being able to provide cheaper products and services to a particular customer base and reinforce its brand as a destination for the underserved," says Robert Passikoff, president of consulting consulting firm Brand Keys. Using a retail outlet to sell telecommunication services is nothing new. But given that half of Wal-Mart's 3,500 stores are in rural areas, the Hughes deal represents a clever strategy to access Wal-Mart's base. Better broadband service service will clearly benefit rural communities, as the Pew Internet & American Life Project reported that only 31% of them have access to high-speed Internet services. "It will also offer a true one-stop-shopping experience," says Abella. These services will also help burnish Wal-Mart's image, which has been tarnished in the last couple of years by heavy criticism of its wage and health benefit policies policies and problems with customer customer service. Earlier this year, Chief Executive H. Lee Scott announced that over the next two to three years Wal-Mart will add 400 in-store health clinics to its already existing base of 78 clinics. Each visit costs an average of $45 to $50, compared with $150 for a visit to the doctor's and $400 for a trip to the emergency room. Wal-Mart found that 40% of visitors at these clinics were uninsured. At the same time, the $4 generic prescriptions Wal-Mart introduced in September, 2006, now account for more than 35% of all prescriptions filled at the chain. Nearly a third third of the $4 prescriptions prescriptions are filled without without insurance. insurance. 2. New Areas for Price Competition
"The response has been nothing short of spectacular," says Scott "Within days of announcing our $4 program, countless other discounters, drug stores, and supermarkets dropped their prices on generic prescriptions." 7
The Bentonville (Ark.) company earlier this year also announced the Wal-Mart MoneyCenters , which would offer its customers a host of financial services including check-cashing, bill payments, and international money transfers. According to ACNielson , 42% of Wal-Mart shoppers have yearly household incomes under $40,000. Banking service would help many customers who are described as "unbanked" because they don't use banking services. Wal-Mart says its entry into financial services has already cut some fees, such as checkcashing, by 25% to 50% in certain markets. Sure, Wal-Mart is entering unfamiliar territory with Net access. How well Hughes serves Wal-Mart customers in a service-intensive business could make it vulnerable to complaints. "Wal- Mart will essentially be a reseller…and the service quotient will be beyond their control," says Abella. But he also believes that, as in most product categories Wal-Mart enters, prices for satellite service in rural areas will drop. And for Wal-Mart's core customers, low prices always matter. 3. Expansion In Urban Areas With Smaller Format Stores
Wal-Mart’s executives have indicated that the retailer’s future stores will occupy 8% less space, cost 16% less and will run more efficiently. Wal- Mart’s smaller stores, called Express stores, are one-tenth the size of a typical WalMart supercenter and offer 15,000 items in comparison to 100,000 offered at a supercenter. Although their size is much smaller, Express stores offer day-today groceries and general merchandise. They are focused on attracting customers who shop regularly for their daily needs. Wal-Mart opened its first Express store in June 2011 and had 11 stores operational at the end of July 2012.In fiscal 2013, the retailer opened 76 smaller format stores, including Wal-Mart Express and Neighborhood Markets, and 8
plans to add 100 more in the current fiscal year. Wal-Mart stated that its Express stores are generating double-digit comparable store sales growth. We believe that this is an encouraging encouraging sign for the company and will help it continue its growth in the U.S. Express format can be successful in big cities, which have space constraints and where busy schedules limit many customers from driving to a supercenter. 4. Focus On Social Media & Technology
Wal-Mart has made strong efforts to improve its IT capabilities and has leveraged social media in order to reach its prospective customers. Its digital technology unit, @WalmartLabs, creates platforms and products around social and mobile commerce. Since its inception, @WalmartLabs has been actively scouting for acquisitions. In November 2011, it acquired Grabble, the maker of ‘point of sale technology’ that ties in with mobile phones. Wal-mart is also
trying to leverage social media to drive its sales. In 2011, it partnered with Facebook and also acquired Kosmix, a social media company to promote its offerings.
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The U.S. customers are increasingly turning to online shopping and e-commerce channel provides an incredible growth opportunity. Although Wal-Mart does not report its e-commerce revenues, Internet Retailer estimated its online sales to be around $4.9 billion in 2011.
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In October last year, Wal-Mart projected
this figure to almost double by fiscal 2014.
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Given the increased usage of
social media and launch of affordable smart phones, Wal- Mart’s investments in this arena are likely to payoff. It’ll also help the company to face competitive
threat from online retailers such as Amazon.
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Hr Policies
The polices regarding the human resource are as follows...
1. Positive & cheerful atmosphere 2. Respect for the individual 3. Stop the bullying Most important is ...
4.Does not give over time to employee 5. Zero overburden of work 6. Workers right of work shipment 7. Hiring- offer of empolyemnt 8. Diversity of work 9. Pay administrative administrative 10.leave of absence 11. Low hours of work 12.Families to the workers
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Marketing Strategies
Wal-Mart is not particularly known for their impeccable customer service. Even further, Wal-Mart lacks in cleanliness and breadth of product lines. But what they lack in aesthetics, they make up for with an absolutely unparallel convenience and price competitiveness. Wal-Mart has redefined the art of online marketing, using techniques at grand and impressive scales to become one of the top company’s in the wide history of corporate America. Wal-Mart’s online marketing campaign covers all facets of strategy, but through all the apparent strategies, it is their aggressiveness that has highlighted and broadened their need to succeed and remain at the top of the industry in retail. But an aggressive campaign inevitably garners controversy, and through the years, Wal-Mart has been involved with a fair amount of negative publicity directly involving their specific marketing strategies. Their bullying nature has caused many to deem them unreasonable and unfair- Wal-Mart still remains number one despite the negative attention. Wal-Mart’s marketing consists of flooding the market with their presence. This is alarming for individuals individuals who find WalWal - Mart’s business practices alarming. But with such a massive quantity of stores, intensely competitive pricing, and such a large market share, their marketing strategy has entailed an overall takeover of all the appropriate markets. They offer many types of products, with a relatively comfortable list of options. As well, Sam’s Club offers an alternative for those who prefer bulk. And with such a strong base of customers, they are able to set the prices for what they pay for. If you want your product in Walmart, you are at the mercy of them setting the price they will pay. If it is below cost, then so it is. The truth is, Wal-Mart can offer a company a prime opportunity to get their product to the masses- even if they lose money doing so. Their online marketing has them being as transparent as possible in an attempt to dissuade the controversy controversy to their name. You can purchase their entire collection of products through through the web. You can read customer reviews, sign-up for a newsletter, and get options for special deals available only through the website. Despite this, such a business relies strongly on their physical location- exactly why a store finder is located right at the top in bright yellow. 11
This competitive nature has allowed controversy to flourish under their name. But their marketing has focused on quantity, and delivering variety in one location. Their extending hands to Subway and McDonalds for placement of restaurants in Walmart’s, further validates this claim. As well, a typical customer can get glasses prescription, get their haircut, and oil changed under their building. You can purchase jewelry on one side, and draperies on the other. You can buy groceries and grab a new lawnmower (while waiting for an oil change). Their recent cooperation with SunTrust bank has allowed their presence in Southeast Walmart’s. Their marketing has always relied on variety- how many single things can you do in one location. Wal-Mart has garnered its fair share of controversy. Yet, the convenience is truly unrivalled. With such a wide breadth of options for a consumer, it seems almost silly to shop at another location where these options are severely limited. Wal- Mart’s online marketing is simply an extension of their physical stories, allowing individuals to purchase directly through the site.
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Swot analysis 1. Strength
Largest Retailer in the world.
Loyal customer base.
Everyday Low Pricing.
Established brand name.
supply chain and logistics capabilities.
wide network of stores.
Buy in Bulk.
Caters to a wide range of needs.
continuous opening of new stores.
Immediate acceptance of George in Canada.
Trend office in New York.
Positive Reviews of
Wal-Mart collection Apparel at NY’s Fashion
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2. Weaknesses
Growth in Cost Structure.
Large Inventories.
Negative
Publicity. Publicity.
Increase in Overhead Expenses.
Lackluster Sales.
Selective purchases of middle class customers. customers.
Low Impact of the George Brand in the U.S.
Crowded store.
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3. Oppurtunities
Fashion Goods Category.
Decrease in Disposal Income. Income.
Economies of Scale.
Increase sustainability sustainability and wealth of the Middle Class.
Retail market growth in emerging markets
Rising acceptance of own label products
Trend toward healthy eating Online shopping growth
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4. Threats
Increase Expansion Expenses.
Skyrocketing Energy Expenses.
Increasing Competition.
Economic crisis and economic instability
Highly competitive environment with entry of more banks
Stringent Banking Norms by RBI.
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Porters 5 forces model This model consists of five forces which are presented in the diagram.
1. Suppliers
Weak Bargaining power
Largest account for most of the producers
2. Threat of entry
Threat of new entrants is weak
Wal-mart’s great scale of operations
It would take years or may be decade to for a new player to be on the same level
Today even big players also have extreme difficult time matching the costs and prices Wal-mart provides
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3. Buyers
Weak bargaining power of buyers
Broad base of customers and a significant significant demand for low prices
4. Substitutes
Low threat of substitute product
Wal-mart exerts a great deal of effort in making sure they are innovative & meeting customer demands
5. Rivalry
Fairly weak competitors
Even though though market is crowded crowded Wal-mart has the lowest lowest costs prices.
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Csr Activities
enviormental sustainability
women economic empowerment csr activities
hunger and nutrition
ethical sourcing
1. Enviormental sustainability
Three sustainability goals
Environmental sustainability has become an essential ingredient to doing business responsibly responsibly and successfully. successfully. As the world's world's largest retailer, retailer, our actions have the potential to save our customers money and help ensure a better world for generations to come. We've set three aspirational sustainability goals:
To be supplied 100% by renewable energy renewable energy zero waste To create zero waste sell products that sustain people and the environment To sell products
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Sustainability Hub
Visit the Walmart the Walmart Sustainability Hub, an Hub, an online location for Walmart suppliers, associates and partners to learn, connect and drive sustainability through collaboration.
The green room
The Green Room is a Walmart blog that we hope to develop into a vibrant conversation conversation about helping people live better around the globe. 2. Women's Economic Empowerment
In 2011, Walmart launched the Global Women's Economic Empowerment Initiative. By using our unique size and scale, we are empowering women around the world. Over a billion people live in poverty worldwide – 70% 70% are women. Nearly 775 million people can't read or write, and the majority are women. Almost 15 million households in America are headed by women. Despite being the sole providers, more than 29% of women live below the poverty level in the U.S. Through Walmart's Global Women's Economic Empowerment Initiative, Initiative, we'll help provide more training, market access and career opportunities to nearly 1 million women, many on farms and factories, ultimately allowing them access to the economic opportunity they deserve. Women in Factories Training Program
In 2012, Walmart launched the Women in Factories Training Program, a Program, a fiveyear initiative that will train 60,000 women in 150 factories and processing facilities producing for top retail suppliers in industries with high percentages of women. The program, which is being implemented in collaboration with local NGOs, will teach critical life skills related to communication, communication, hygiene, reproductive health, occupational health and safety, identifying personal strengths and gender sensitivity. Up to 8,000 women will also receive leadership training to develop the work and life skills necessary for personal and career development. development. Walmart is supporting small women-owned businesses around the
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Empowering Women Together is an online destination on Walmart.com on Walmart.com that gives shoppers who want to buy unique and interesting products the opportunity to do so while supporting small women-owned businesses around the world. With each purchase, consumers lift and empower the women behind these products to create new jobs and improve both their own lives and the lives of their families and communities. At launch, Empowering Women Together offered shoppers shopper s more than 200 items from fro m 19 businesses in nine countries. The program is part of Walmart's larger Women's Economic Empowerment Initiative's commitment to source $20 billion from women-owned businesses.
3. Hunger and nutrition Driving change to feed the nation
Walmart is committed to getting the best, the healthiest, the most affordable food to as many people as possible. We are fighting hunger in the U.S. We’re making food healthier and healthier food more affordable. And we’r e using our size and scale to help support farmers and their communities, produce more food with fewer resources and less waste, and sustainably source key agricultural products. For us, it’s not about setting lofty goals. It’s about real and meaningful ac tion. It’s about driving change and creating a movement. A movement that refuses to accept hunger, that fuels the growth and well-being of our nation, and a movement that strengthens the global food supply chain. Making food healthier and healthier food more affordable
At Walmart, our journey with nutrition began where everything does — with with our customers and our mission of helping people save money and live better. To more and more of our customers, living better means the ability to walk into our stores and find affordable food that will help their families live healthier lives. We believe a family shouldn’t have to choose between food that is more nutritious for them and food they can afford. That’s why we’re work ing ing with suppliers to reduce salt and sugar in key products, starting with our own Great Value brand. We’re doubling the amount 21
of locally grown produce we buy, supporting the farmers in local communities. Since 2011, we've saved our customers $2.3 billion on fresh fruits and vegetables. We’re also providing a new Great for You icon, appearing on select products in our stores, to make it easy for customers to instantly instantly identify more nutritious choices. Walmart’s commitment to fight hunger
In 2010, Walmart and the Walmart Foundation launched "Fighting Hunger Together" – a $2 billion cash and in-kind commitment through 2015 to fight hunger in America. This initiative leverages Walmart's size and resources to provide nutritious nutritious food food and the Walmart Foundation's Foundation's ability ability to grant funding funding to nonprofits that help elevate the issue. Donations of cash, food, refrigerated trucks, mobile pantries and other resources are changing lives across America. In 2012, Walmart and the Walmart Foundation became the first partner of Feeding America to surpass 1 billion meals donated.
4. Ethical Sourcing
The foundation of Walmart’s business has always centered on help ing people live better. This mission applies not only to our customers and associates, but also to the workers who make our products.
We collaborate with other retailers, brands, NGOs and government leaders to verify the products we sell are produced in a way that provides dignity and respect for workers in our supply chain. As the world’s largest retailer, we strive to positively influence global supply chain practices by raising our own standards and improving working conditions in the countries from which we source.
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Merger and acquisition Collaborating with stakeholders for positive change
Meaningful collaboration with key stakeholders is essential to driving positive and sustainable change in the supply chain. This is why we continue to work with leading NGOs and take an active role in industry coalitions. We work to improve the effectiveness of our own ethical sourcing program and, ultimately, improve the lives of workers in our supply chain. Over the past several years Walmart has implemented a number of programs to support local suppliers and workers including:
Improving the jobs for more than 17,000 workers in 34 factories in Bangladesh through our Lean Lean Manufacturing program. Through program. Through this program workers are able to become more empowered through job skills and factory efficiency training. Learn more from Asda in the UK.
Launched a program aimed at empowering the women who work in Walmar t’s supply
chain factories through the company’s Women in Factories Training program. program. This program is teaching 60,000 women critical life skills including conflict resolution, communications, skills, personal health and wellness.
Working with our supplier partners and their factories to help them develop the capability to improve working conditions by investing in education, training and operational efficiencies through our Supply Chain Capacity building programs including the Supplier Development Program, Violation Correction Training, Orange School Program and Supplier Round Tables.
Participating in the Bangladesh Buyers Forum, to collaborate with 18 other brands to provide a training t raining program to increase fire increase fire safety awareness among our suppliers and their employees in garment factories, which is expected reach to over 3,000 exporting garment factories in Bangladesh.
Some of our partners include: Global Social Compliance Program
The The Global Social Compliance Program (GSCP) is a business-driven program created to promote the continuous improvement of working and environmental conditions in global supply chains. The GSCP was created by five leading companies, including Walmart, and is 23
now made up of 39 brands and retailers. Members are working to enable mutual recognition between existing social and environmental compliance systems globally, in order to reduce duplication in auditing and build trust for further collaboration. International Labor Organization/International Finance Corporation Better
Work Program
The combined efforts of the the International Labour Organization (ILO) and the International the International Finance Corporation (IFC) launched the Better the Better Work Program with an objective to improve factory working conditions in the garment sector. Program components include monitoring factories, conducting training modules and engaging with key stakeholders, including workers, factories, communities and governments. We've partnered with the ILO/IFC in support of the Better Work Program, which currently operates in Cambodia, Haiti, Indonesia, Jordan, Lesotho, Nicaragua and Vietnam, with plans to expand into Bangladesh and other sectors of production such as footwear. Ethical Trading Initiative
Asda/George is a founding member of the Ethical the Ethical Trading Initiative (ETI) and works within a multistakeholder environment on industry issues such as home workers, Sumangali workers, working hours projects, fire safety, living wages and purchasing practices. ETI touches a wide spectrum of issues to help improve and drive change through the supply base we source from and to improve conditions for the workers who make our clothes.
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Conclusion Globalization will continue to affect different parts of the world positively and negatively. Walmart will continue to build more and more chains and not just in the United States. People will also take more job offerings because many other career options are not available in the present. We have to see that this cycle is not necessarily vicious, but that it is just the way our world runs, and there will always be a global North and a global South. For now, Walmart and its sister companies abroad will mostly be in the prospering North, and we will continue to buy cheap and (mostly) disposable items that the global South exports to us. Even though MNCs have taken over big business, we have to realize that this is actually beneficial to us in many ways. All in all, by implementing these three important strategies successfully, WalMart has become from a single store to the biggest retailer in the US and to the biggest company company in the world. The The cost management strategy strategy of Wal-Mart wills create an operational model with the lowest cost which will increase the margin of profit on the financial statements. Moreover, the growth management strategy had dragged Wal-Mart into the right direction of investment and expanded radically around the distribution center. Lastly, the people management strategy inspires all associates to work more efficiency and creates a great workplace environment which full of self-improvement, competition, and respects. It also provides an opportunity for people to build-up experience from the low-rank position to the high-rank position. Therefore, strong management in these three strategies had transformed transformed Wal-Mart into the biggest company in the world with the highest number of employees worldwide and had also provided benefits to millions of people around the world by transferring unnecessary cost into low-cost products.
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Bibliography www.walmart.stores.com www.walmart.com www.busika.com www.businessweek.com
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