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Amazon vs. walmart case study
Walmart corporate strategy
Literature review on total quality management
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While Walmart has seen success in their On-line expansion it is still small potatoes compared to their in store sales. Walmart has grown to be the largest brick and mortar retailer in the world. A key challenge is not sacrificing the success of their retail stores to compete in the E-commerce market. However, with more people doing their shopping online and Amazon's push into brick-and-mortar with Whole Foods, Wal-Mart faces a major risk. Driving more customers to pick up online orders in stores is a key piece to its new strategy. If a customer is going to Walmart to pick up an online order, that customer can buy groceries or that household item while he or she is there, instead of at one of Wal-Mart's competitors (Levy,2017). Risk mitigation planning is the process of developing options and actions to enhance opportunities and reduce threats to project objectives Mitigation of risk is a part of the discipline of risk management. …show more content…
Continual improvement drives an organization to be both analytical and creative in finding ways to become more competitive and more effective at meeting stakeholder expectations. Reference: Levy, A. (2017). Wal-Mart's Latest E-Commerce Strategy Is a Big Risk. The Motley Fool. Retrieved from: https://www.fool.com/investing/2017/11/14/wal-marts-latest-e-commerce-strategy-is-a-big-risk.aspx Levi, Daniel. Group Dynamics for Teams. Sage Publications, Inc., 2001. Sandilands, T. (2017). Examples of a Mitigation Plan. Chron. Retrieved from: http://smallbusiness.chron.com/examples-mitigation-plan-24507.html Yohn, D. (2017). Walmart Won’t Stay on Top If Its Strategy Is “Copy Amazon” Harvard Business Review. Retrieved from: https://hbr.org/2017/03/walmart-wont-stay-on-top-if-its-strategy-is-copy-amazon WHAT IS TOTAL QUALITY MANAGEMENT (TQM)? (2017). ASQ. Author unknown. Retrieved from:
I don't see Wal-Mart as a huge retailer trying to take over the world with cheap prices. I see Wal-Mart as business that has played their cards the way they were dealt. Our economy is poor right now; banks are hurting because people a...
Wal-Mart’s strategy over time helped it establish leadership position in discount retailing. It used rural underserved markets to announce its arrival. It also used innovation levers, customer centricity, positioning as a low cost player, and effective stakeholder management including employees, suppliers, and stockholders to achieve distinctive competitive advantage. It successfully outperformed other firms in the industry leveraging its strategy to achieve overall cost leadership.
Wal-Mart’s competitive environment is quite unique. Although Wal-Mart’s primary competition comes from general merchandise retailers, warehouse clubs and supermarket retailers also present competitive pressure. The discount retail industry is substantial in size and is constantly experiencing growth and change. The top competitors compete both nationally and internationally. There is extensive competition on pricing, location, store size, layout and environment, merchandise mix, technology and innovation, and overall image. The market is definitely characterized by economies of scale. Top retailers vertically integrate many functions, such as purchasing, manufacturing, advertising, and shipping. Large scale functions such as these give the top competitors a significant cost advantage over small-scale competition.
According to Smithson, Walmart can expand its markets to new and emerging markets especially in the third world countries, which can significantly increase its revenues. Secondly, the company can reform is employment practices and improve the quality standard and in doing so, attract more customers and improve its brand image. On the other hand, the company faces threats such as the rising healthy lifestyle trend I that the company in most cases does not provide customers with healthy goods. At the same time, the company can capitalize on this aspect and increase its revenues. Aggressive competition from other discount retailers such as Target creates a great threat to the company (Smithson, 2015).
In these economic times Walmart faces many challenges with staying on top as a low price leader. Competitors have also been challenging the retail discounter. Companies like Target, Dollar General and Dollar stores continue to cut prices to lure families away from Walmart.
I believe in a strategic sense that Wal-Mart has chosen to make their stores the "one stop shop" for everything the common American household needs. To do this, they have developed strategically over the years by growing from their initial platform of "Wal-mart" (offering common retail merchandise at the lowest price available in a given area) to the stores they have today, which are all-inclusive supercenters that sell groceries, electronics, apparel, home improvement, pharmacy, automotive, and the list goes on. In doing so, they have strategically improved their economies of scale, which further improves their ability to be a low cost leader. Additionally, with a seemingly insurmountable foothold in the US market, they have expanded their strategy around the world to improve sales and buying power from suppliers. According to the text, while all of this financially based strategic maneuvering has been happening, they have also worked to improve the environment through waste reduction efforts, their image through revised pay and benefits to their associates, and their overall public perception through disaster relief efforts and revitalization of empty stores in underdeveloped areas of the country.
The material used to analyze Wal-Mart strategy consists of the company's annual reports, its Fact Sheets and other information found on the company Internet site. Other information is obtained from outside sources such as Fortune Magazine, and from outside groups who are critical of the corporation. The focus of this analysis will be placed on identifying the resources of the firm, its weaknesses and strengths in terms of its competitive environment. The sections examined will highlight the leadership style of Wal-Mart CEO H. Lee Scott, who inherited the corporate legacy of Wal-Mart founder Sam Walton. Other elements such as the culture, the corporate organization and values of the company come to play.
Q: Analyze the competitive strategies: What is their key competitive strategy? Are they effective and why? A: Walmart has been able to preserve market leadership position primarily due to its efficient integration of suppliers, manufacturing, warehousing, and distribution to stores. Its “supply-chain strategy” has four key components: vendor partnerships, cross docking and distribution management, technology, and integration. This management strategy has provided the company with several sustainable competitive advantages, including lower product costs, reduced inventory carrying costs, improved in-store variety and selection, and highly competitive pricing for the consumer. Walmart’s low-cost leadership strategy and differentiation strategy support the supply-chain strategy in order to retain competitiveness. According to a University of San Francisco case study, it was revealed that “[Walmart’s] competitive strategies are very effective because it provides consum...
From 1962 (when it opened its first store in Rogers Ark) up to recently, Wal-Mart has evidently enjoyed unprecedented success. The company grew from a local retail store to become not only the largest retailer in the country, but also an organization with a global presence and reputation (Hayden, Lee, Mcmahon & Pereira, 2002). With a history of surpassing sales target, it appeared almost certain that the trend would progress in the new millennium. However signs of danger begun to emerge as early as 2001, when for the first time it missed out on its sales target (Wal-Mart Watch, 2007). Oslon, Van Bever and Verry (2008) noted that wh...
I personally think Wal-mart can sustain this competitive advantage. The ability of a firm to protect its competitive advantage is not whether the advantage is theoretically replicable that matters in practice, but the difficulty that competitors face in matching the leader’s offer. In this day and age, Satellite-based infrastructure is still rare. It is a huge investment. This technology is scarce and not readily available for acquisition by competitors. This infrastructure is valuable to Walmart, and could not easily imitated. The infrastructure is un-substitutable. Moreover, the collaboration relationship between Wal-mart and P&G cannot be duplicated or substituted. The supply chain management expertise of Wal-mart is also unique and valuable.
Recommendation Solution: Now with the current store closings, Walmart finds itself in a completely new market with brands and competition never seen before. By opening local markets into small communities, the company begins to place pressure on smaller grocery stores like Whole Foods, Trader Joes, and Moody’s. Walmart will enter with the same strategy and will likely find themselves with the same success in their new markets. Lower prices are Walmart’s key seller and when placed side by side with their competitor they win every time Walmart’s current success is built on its ability to provide great products to their masses at the lowest prices. Their current business model thrives in their ability to be competitive and maintain customers.
Wal-mart has a reputation for caring for its customers, of course their employees, and for the prospective public. So Wal-Mart can be an industrial leader for the world of shoppers with an eye for lower affordable prices, company decision makers would continue it's systematic strategies that it's founder and president established years ago. Sam Walton believed in three guiding principles in his strategy planning they were to provide the customer with good value and service, to have a good relationship with its associates, and to be involved with the community.
Recently, convenience has been a very big driving factor behind consumers with the emergence of ecommerce and online stores. Therefore, even though Walmart is on the Fortune 500 list and one of the biggest retailers in USA, it started facing competition from online department stores like Amazon. From brick-and-mortar to click-and-mortar, Walmart’s journey has been an interesting one.
For the strategic opportunities analysis of Walmart, they are mainly about expansion and improve its business practices. Those opportunities are linked to the federal government, global economic situation and also technology. In this portion of the analysis, we have created a table that briefly summarized the opportunities and solutions that Walmart need to take action in order to receive benefits.
Based on the current market capabilities of Walmart, Walmart is nearly comparable to a company such as Amazon. Walmart has a focus on brick and mortar stores as the front line to customer satisfaction. They currently provide as a retailer, many tailored services such as grocery pick up, pick-up in store, as well as purchasing entirely online. Recently Walmart has raised online prices to push individuals going in store to purchase items due to mass sells online that is gradually taking away from the main focus on Walmart stores for consumer needs.