Wal-Mart Formal Case Analysis-Swot
Wal-Mart Formal Case analysis
June 2007
SWOT Analysis
The SWOT Analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a business, in order to reach its objectives. Wal-Mart objective is to always offer low prices and to become the number one largest retailer in the world.
Strengths refer to the attributes of the organization that help achieving its objectives. First of all, Wal-Mart is one of the largest retailers in the world. Its size it allows Wal-Mart to control suppliers, to control competitors and to open stores wherever they want. Their international presence contributes to its power. Having the second largest net sales in the world, this company is an important player in the world’s economy. A large number of people work in their stores, many suppliers distribute only for Wal-Mart and for many manufacturers their main client is Wal-Mart. Also it is the largest employer in the United States according to the American government. Working in a Wal-Mart does not require high-level education, so people that don’t have a college degree have an opportunity to work for them. From Exhibit 1 we calculate that the number of new stores opened around the world in one year (2003-2004) was of 234. This demonstrates that one of Wal-Mart’s strategies is an aggressive growth. Another one its strengths are the low prices offered on its products. Low prices are an important factor in a family’s buying habits and Wal-Mart makes sure to remind that to people everyday through their commercials. Furthermore, their IT department is continually improving and finding new ways to reduce spoilage and waiting times. Their new tools for management, forecasting and inventory allowed fast distribution between centers, and inventory accuracy as high as 94% in Japan. The possibility of online purchasing increased the popularity of Wal-Mart’s website. All in all Wal-Mart went from a simple retail store to a
June 2007
SWOT Analysis
The SWOT Analysis is a strategic planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a business, in order to reach its objectives. Wal-Mart objective is to always offer low prices and to become the number one largest retailer in the world.
Strengths refer to the attributes of the organization that help achieving its objectives. First of all, Wal-Mart is one of the largest retailers in the world. Its size it allows Wal-Mart to control suppliers, to control competitors and to open stores wherever they want. Their international presence contributes to its power. Having the second largest net sales in the world, this company is an important player in the world’s economy. A large number of people work in their stores, many suppliers distribute only for Wal-Mart and for many manufacturers their main client is Wal-Mart. Also it is the largest employer in the United States according to the American government. Working in a Wal-Mart does not require high-level education, so people that don’t have a college degree have an opportunity to work for them. From Exhibit 1 we calculate that the number of new stores opened around the world in one year (2003-2004) was of 234. This demonstrates that one of Wal-Mart’s strategies is an aggressive growth. Another one its strengths are the low prices offered on its products. Low prices are an important factor in a family’s buying habits and Wal-Mart makes sure to remind that to people everyday through their commercials. Furthermore, their IT department is continually improving and finding new ways to reduce spoilage and waiting times. Their new tools for management, forecasting and inventory allowed fast distribution between centers, and inventory accuracy as high as 94% in Japan. The possibility of online purchasing increased the popularity of Wal-Mart’s website. All in all Wal-Mart went from a simple retail store to a