Walmart success story

Résumé du document

The large scale retail sector consists of multiple companies of very heterogeneous sizes. This disparity can be explained by the strategy adopted by certain companies to grow rapidly in order to be a market giant, by implementing waves of fusion-acquisitions, which make it possible for the brands to acquire a strong external growth. This phenomenon takes place mainly in Europe, the playground of major retailers and MNCs operating large discount stores. Parallel to this tendency, was born, in the United States, another model which allowed the emergence of the world leader in retail: Wal-Mart.

Since 1962, the year when Wal-Mart first opened its doors to the public, the brand has gradually risen to power, triggered by the growth of its domestic market (the United States) which constitutes the largest international market in consumption. Today, Wal-Mart is the veritable giant of retail and is the leading global company according to Fortune 500 with a growth of 9.5%, thus reaching turnover worth $312.427 billion, a profit of $11.231 billion and 1.8 million collaborators. The company has more than 6,100 stores including 2,285 stores in the United States.

Wal-Mart's primary activities in its "business portfolio" include the stores located within the United States. The strategy of internal growth carried out since the creation of the company has enabled it to control the whole of the American domestic market.
The company's internalization strategy is very recent. Indeed, the first establishment ,Mexico City, goes back only to 1991. That makes it possible to explain weak statistics by Wal Mart stores abroad (1,170), compared to competitors, such as Carrefour (9,600 retail stores).

Extraits

[...] Concerning the exit barriers, one will speak about disengagement or investment. There exists a positive relation between the sector profitability and the level of the barriers at the exit. More the barriers at the exit raises, more the candidate will invest and more the profitability will increase. In the distribution sector, the actors invest such amounts that they cannot disinvest without losing more than the initial investments, even if they cannot reach the leader position or increase their market shares. [...]

[...] Walmart 1. Introduction The sector of large distribution consists of multiple companies of very heterogeneous sizes. This disparity is explained by the strategy of certain companies to quickly grow in order to reach a critical point, explaining the waves of fusion-acquisitions, which make it possible the signs to acquire an external strong growth. This phenomenon takes place mainly in Europe, place where the great international groups of distributions are. Parallel to this tendency, was born, in the United States, another model which allowed the training of the world leader of the distribution: Wal- Mart. [...]

[...] Then, the internalization strategy is very recent. Indeed, the first establishment abroad (that of Mexico City) goes back only to 1991. That makes it possible to explain weak detention by W-M of stores abroad ( 1.170 compared to competitors, such as Carrefour (9600 retails stores). In this report, we want to present, and explain the general environment analysis and the competitor environment in the first part. Then, we are analyzing the external and the internal environment. To finish, we want to analyze the strategic intent and mission and the last part, we want to purpose alternatives and recommendations for Wall-Mart General Environment Analysis The greatest challenge at the time of a strategic choice on the basis of strategic alternative is the good comprehension of the external environment, the analysis of the change of the structure of industry at the favorable time and the comprehension in the way in which the direct competitors move and answer the various constraints with the internal and the external one. [...]

[...] “Wal-Mart to Make Seiyu 100% Wall Street Journal March 2008. [...]

[...] The important variables which synthesize the relations between Wal-Mart and its suppliers are three variables with knowing costs, times and quality and the after sale services. Beyond these commercial relations, Wal-Mart knew to work out partnership relations. So we can now say that this partnership and preferential supplier strategy is part of the Wal-Mart competitiveness. Moreover, it helped the company to develop others strategy as the just in time, to create the Total quality management and to implement and optimize its supply chain management. [...]