Retail Management Walmart
-
Upload
saytanya-sonowal -
Category
Documents
-
view
217 -
download
0
Transcript of Retail Management Walmart
-
8/11/2019 Retail Management Walmart
1/17
RETAIL MANAGEMENT
Group : Ankita Prasad | Karthick Sharma | Ramanathan K |
Saytanya Sonowal | Sonia Joseph | Varsha Poddar
-
8/11/2019 Retail Management Walmart
2/17
WALMARTThe Company
Walmart is the largest retailer and largest company in terms of revenue.
The company was founded by Sam Walton
First store opened in Rogers, Arkansas in July,2962
Company is publicly traded at the New York Stock Exchange under the symbol WMTand has itsheadquarters in Bentonville, Arkansas
Walmart operates over 11,000 retail unitsunder 71 banners in 27 countries and e-commercewebsites in 10 countries
The company employs 2.2 million associatesaround the world 1.3 million in the U.S. alone
Every Day Low Price (EDLP) is the cornerstone of the companysstrategy
Wal-Mart topped Fortune magazines list of top 500 companies in the world, successively for
three years in 2004.
Walmart U.S.
WalmartInternational
Sams Club
Walmart Global
eCommerce
Different types of storesWalmart Supercenter, Walmart Discount Store,Walmart Neighborhood Market, Walmart Express
Walmart became an international company in 1991, and we operate in 26
countries outside the United States with more than 6,100 stores
Sam Walton opened the first Sam's Club in 1983 to meet a growing need amongcustomers who wanted to buy merchandise in bulk
Mobile transforms the retail experience by bringing together online and stores
putting power directly in the customers' hands
-
8/11/2019 Retail Management Walmart
3/17
History & Global Expansion
1962Retail Revolution began when Sam Walton opened first Walmart store; 1969Company
officially incorporated as Wal-Mart Stores, Inc.
Walmart went National; 1970Became publicly traded company; 1971First Distributioncenter and Home Office opened; 1972Listed on NYSE (WMT); 1979WalmartFoundation established
1980Reached $1 billion in annual sales; 1983First Sams Club opened; 1987 -installed the largest private satellite communication system in the U.S., linking thecompany's operations through voice, data and video communication
1991Walmart went international opening Sams Club in Mexico City; 1994 Expanded
into Canada; 1996Opened first stores in China; 1997First $100 billion sales year;1998Neighborhood market format introduced; 1999Entered U.K.
2000Walmart.com was founded; 2002Company topped Fortune 500 ranking of America'slargest companies; 2009 - Walmart exceeded $400 billion in annual sales; 2010 - Bharti Walmart,a joint venture, opened its first store in India; 2011 - First Walmart Express stores were introduced
1960s
1970s
1980s
1990s
2000s
-
8/11/2019 Retail Management Walmart
4/17
Evolution
1962 - 1964 1964 - 1981 1968 - 1981
1981 - 19921992 - 20082008 - present
-
8/11/2019 Retail Management Walmart
5/17
Impact on the Economy
Dying Real
Estate
As the retail jobs are lost, the owners of retail stores are left with no option butto close down the stores due to which the prices of the real estate drops by asignificant amount.
Government
Subsidies
Government has been providing subsidies to Walmart for opening stores indifferent regions. As a result, huge amount of tax payers money is beingutilized to set up stores by Walmart. Also, a huge amount of tax payersmoneyis used for providing Medicaid for Walmartsemployees. Thus, Walmart enjoysthe privilege of shelling out very low wages for its employees
Unemployment
Everyday Low Prices methodology followed by Walmart is responsible fordestroying the retail jobs. Small Mom and Pop stores are not able to compete
with Walmart in terms of pricing due to which, eventually, they lose out oncustomers. This is one of the reasons why FDI in retail was opposed in Indiaby retail shop owners.
Unethical
Practices
Walmart has been accused of following unethical practices when it comes topaying salaries for its associates. The associates are paid in terms of numberof hours worked. The managers are encouraged to reduce the number ofhours an associate has actually worked due to which many associates havesued the company.
EnvironmentalFootprint Walmart has also been sued in courts for its environmental unfriendly practices.
-
8/11/2019 Retail Management Walmart
6/17
Entry
Strategi
es
Acquisitions
Exporting
Franchising
Wholly ownedsubsidiary
Licensing
Greenfieldventures
Strategic alliances
Turnkey projects
Joint ventures India- JV with Bharti Airtel- Failed
Brazil- Acquired Ahold Store
Argentina-entered in 1995 by setting up100%-owned greenfield stores
Entry strategy adopted by Walmart in major markets
Costa Rica, Guatemala, Honduras,Nicaragua-acquisition of Central
American Retail Holdings Company in2007
Korea-1999 entered by acquiring four
units from Macro
Mexico-50:50 joint venture with theleading retailer
Hong Kong- JV with Thai partner
China
Reason forfailure
Failed to localize,made an offer to
Emart for acquisition.Made an exit selling its
stores to Emart
Selection of wrong
partnersThai partner instead ofcompany from Taiwan
or Hong Kong
Selection of wrongpartners
Bharti Itself had
intentions to become aretail giant
Acquisitions and
Greenfieldinvestments have
yielded better
results for
Walmart
-
8/11/2019 Retail Management Walmart
7/17
Walmart in JAPAN $451 billion retail industry
Entered in March 2002, through an alliance with Seiyu Limited
Introduced best practices in retailing like Every Day Low Prices (EDLP) and the supply chain
management softwareISSUES in JAPAN
Wal-Marts retail model was not the right fit as Japanese consumers were not very priceconscious and preferred conveniently located stores
Faced trouble with procurements as the Japanese retail sector was a multi-layered networkof suppliers
-
8/11/2019 Retail Management Walmart
8/17
Entered China in 1996
Adopted a slow growth approach
The company sold goods worth $940 millionand purchased goods valued at $18 billionfrom Chinese manufacturers in 2004
Implemented global practice of Every Day
Low Prices (EDPL)
Localized its offerings to Chinese consumerswith significant innovations
ISSUES in CHINA
Domestic retailers had the advantage of an
established supply chain network andknowledge of local taste and preferences, inaddition to support from the government inChina
Carrefour gained a lot of ground due to rapidexpansion
Walmart in CHINA
-
8/11/2019 Retail Management Walmart
9/17
Walmart-Strategies for success
Reduce Cost
Minimize bargaining
power of powerfulsuppliers
Remove costly stepsin value chain
Raise prices
Minimizing bargaining
power of powerfulbuyers
Increased ability todifferentiate
Minimize strategicrisks
Reduce the threat ofsupplier buyer cutoff
Minimize technologyspillovers
Increasedresponsiveness
Bring theorganization closer to
customers
Localization
Relies on Vertical Integration
Vulnerabilities in International Strategy
Late entry on foreign markets thus losing first movers advantage
Flawed entry strategy in mature European markets Rashly made acquisitions without judgment (Acquisition of 85
stores with less than 3% market share in Germany
Poor understanding of foreign customer psyche
Anti-union stance leading to union battles and workers lawsuits
Imposition of previously prevelant ways in US on new customers
Wal-Marts success had been the result of its ability to leverage size, market clout, and efficiency
http://anirbankar.com/2011/06/03/wal-mart-international-strategy-case-study/ -
8/11/2019 Retail Management Walmart
10/17
Walmart- Customization in different Geographies
Suppliers
Supplier relationship iscritical
Different qualitystandards
Culture Collisions
Product requirementsBuying patterns
Human Resources
Labour lawsMotivating localemployees
Technology
Online shoppingTechnology breaksthrough geographicallimitation
Competition
Different levels ofcompetition and entrybarriers
Key focus: Stores were located In
small towns and ruralareas with population