Analysis of Wal-Mart Stores – Term Paper

Analysis of Wal-Mart Stores

Introduction

WalMart has been a very influential retailer. It has been ranked as the worlds largest retailer. The retailer has an employee base of about 2.2 million people. The retailer was initially established in 1962 by Bud and his brother, Walton Sam in Arkansas.  In US markets, the retailer manages more than 5,160 stores. In addition, it also has more small-format stores that are located at different places in US. Recent accounts show that WalMart has been growing very fast internationally due to the existing internal advantage on the performance capability of its market. The current international division of the retailer comprise of about 28 percent of its total sales.

Apart from its market dominance in US, the company has also been reported as the biggest retailer in Mexico and Canada with further expansions into Asia and Europe among other prospective destinations. At the time of its launch, Walton was pursuing a business stores business venture called Waltons Five and Dime that had among other components, Ben Franklins Franchise (Boarnet & Michael et al. 38). The new business venture by Walton was not distinct from other trading entities as WalMart does.

Initially, WalMart began as extra stores opened by Walton but later expanded to other areas such as Missouri and Oklahoma in 1968. This expansion was persistent, an aspect that saw the companys change into a public venture with a listing on the New York Stock Exchange in 1972. Besides, the group also opened Sams Club Warehouse Stores in addition to other stores in Indiana and Nebraska regions as at 1983. Through the 1980s, the company had been progressing to realize a sales volume of $25.8 billion with 1,525 stores. Nevertheless, WalMarts performance was badly hit in 1992 when Walton, the chief founder and proprietor died. After three years from his death, his brother, Bud also died making the management of the business a major challenge as the two had been the sole initiator of the Walmarts business venture (Chan 62).

Year later, the business began to pick up again to its current status. It has become the most renowned American retail company with retail stores such as groceries, general merchandise and discount clubs among others. WalMarts approach to business was defined under the clause, Every Day Low Price making it quite distinct among its competing businesses in the industry. WalMart business is divided into three segments with regard to the target market destination. These market segments are: The US retail segment, the international market segments and Sams Club. The following table shows WalMart changes in sales between 2012 and 2013 in US:

Net Sales (WalMart)

2012 ($Billions)

2013 ($Billions)

US segment

72.789

74.665

Sams Club segment

14.010

14.490

International

35.486

37.949

Totals

122.285

127.104

Source: (Boarnet & Michael et al. 39).

In 2013, approximately 58.89 percent of the entire revenue was collected from the American retail segment. Likewise, 29 percent of the sales revenue came from the international market segment representing a significant proportion of the sales. On the other hand, Sams club over the same year contributed 12.11 percent of the entire sales revenue for the retailer (Boarnet & Michael et al. 43). In addition, the retailer also operated in electronics, children and baby clothing as well as fitness products on retail perspective.

The annual revenue of WalMarts is also too large comparatively, set above the GDP of Switzerland as per the statistical outcomes of 2006 as well as today. In addition, the retailer has also been ranked the second largest business enterprise globally with total revenue of $469.2 billion. This ranking is however a product of poor performance after the demise of the owners. In 1990, the company had been ranked as the biggest global retailer. Its development was marked by steady and calculated steps through opening of more stores throughout the country and into the international market segments. For instance, through the Canadian market, WalMart had established 122 Woolco store in addition to establishing additional five in Brazil as at 1995 (Courtemanch et al 44). These establishment marked just a few of the expansion measures that the company had been spearheading in a bid to enhance its market performance amidst chain of challenges that it had faced while spearheading its market growth. Other market destinations that the company expanded into, includes the Argentina, China and Germany.

In 1998, WalMart expanded its scope into the Korean market through a joint venture and later into UK. These markets in particular remain major international destinations for the company. In particular, the UK has becomes the biggest grocery chain for the company and in the industry commonly referred to as ASDA. Besides, the companys international have become largely promising in the context of changing economic situation and the international business culture across many destinations. As a result, WalMart has adopted international growth as one of the main contributors to its growth in the long-run. This is has been informed through research and development. In the contemporary business segment, the company has also expanded to Japan through its retail business ventures (Roberts & Natalie 24). In 2013, the financial report of the company workforce was reported at 2.2 million spread worldwide.

With regard to diversified investments, the company operates other business ventures apart from the retail stores. In particular, the development of online shopping has been one of the main advances that the company has undertaken towards enhancing customer service delivery besides increasing the propensity of consumers to conduct purchases at the convenience of their locations. Customers can therefore make purchases online through a series of displayed products with maximum satisfaction. Customers have been enjoying Walmarts online sales platform as shown below:

Furthermore, WalMart has also been ranked as the Worlds biggest Interbrand entity. Although the company has been leading in the market however, several challenges have drifted its success to concerns of future stability. For instance, the company has been experiencing temporal fluctuations in market performance ability that saw it drop by 6 percent of rankings as per the 2013 financial year. Its competitors such as Macys and Amazon have been engaging rigorous measures to enhance their market performance in the long-run (Boarnet & Michael et al. 44).

Currently, WalMart is the leading retailer that has been using wide range of data to focus and manage its clients. To facilitate these advances, the company has adopted online platform that has enabled it to personalize customers experience besides enhancing the overall retail brand through publication in the companys Retail Brand Report. The ranking of the company has also creating a robust development of its corporate brand with significant values hence developing its strategic rapport with clients on matters pertaining to sales and management of customers data. This enhancement has enabled the company to be able to management and provide its services to its clients more effectively and efficiently (Chuang et al. 51). In the wake of these developments, the company has also been diversifying its operations in order to retain its market dominances amidst growing competition globally.

With regard to its competitors, Macy has been making severe advances in the global market. In particular, Macy has been performing extremely well in tapping the potential of the online consumers who have been associated with a strange tendency of among other things making direct purchases on products that are not only appealing online but also engaging in robust global business advancements that have seen it rise to a major competitor for WalMart and other retailers in the global space. By understand the digital behaviours of the customers that have been associated with increased tendency to minimize costs associated with travelling to make purchases as well as the reduced amounts of time that the current generation of consumers have been left with for shopping. These advances have been very effective in the development of a new customer base through online sale platform that has contributed significantly to the development of the business worldwide.

Finally, WalMart has been engaging a robust business model commonly referred to as Americas Omnichannel store which has been a measure to enhance the companys digital engagement of a hybrid model based on technological support in creating a high shopping capacity of the retailer. In the home improvement segment, the retailer has reported a major growth via Omnichannel marketing model especially through the social media platform. Additionally, other stores allied to the retailer such as the Home Depo and Lowe have developed social communities where consumers access planning and purchasing assistances. These measures have contributed to sound growth of the companys business capacity.

Work Cited

Boarnet, Marlon G, Randall Crane, & Michael Manville. “Emerging Planning Challenges in  Retail: the Case of Wal-Mart.” Journal of the American Planning         Association. 71.4        (2013): 433-449. Print.

Chan, Anita. Walmart in China. Cornell University Press, 2011.         

Chuang, Ming-Ling, et al. “Walmart and Carrefour experiences in China: resolving the structural        paradox.” Cross Cultural Management: An International Journal 18.4 (2011): 443-463.

Courtemanche, Charles, & Art Carden. “Supersizing supercenters? The impact of Walmart      Supercenters on body mass index and obesity.” Journal of Urban Economics 69.2 (2011): 165-181.

Roberts, Bryan, & Natalie Berg. Walmart: Key Insights and Practical Lessons from the World’s;;;;;;;;;;;Largest Retailer. London: Kogan Page, 2012. Print.

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