Professor Lee September 29, 2008 Case Study 1 – Wal-Mart Stores Dan Lessard Landon Heidenreich Tommy Petramalo Kristian Arnesen TABLE OF CONTENTS Table of Contents pg.
1 Executive Summary pg. 2 Ch. 1 pg. 3 1. 1 Mission pg. 3 1. 2 History pg.
3 1. 3 Background pg. 4 Ch. 2 pg. 4 2. 1 Internal VRIO Analysis pg. 4 VRIO Table pg.
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10 2. 2 External Five Forces Analysis pg. 10 2. 3 Problem Statement pg. 15 Positioning Grid pg. 16 Ch. 3 pg.
16 3. 1 Option 1 pg. 16 3. 2 Option 2 Pg. 16 Ch. 4 Strategic Option Evaluation Pg. 16 4.
Strategic Evaluation of Unionizing Pg. 16 4. 2 Strategic Evaluation For Reorganization Pg. 18 4. 3 Recommendation and Plan of Action Pg. 19 4. 4 Competitive Advantage Pg 19 4.
5 Implications Pg. 20 Endnotes Pg. 21 Executive Summary Historically the discount shopping experience began in the mid 20th century, and in 1962 Wal-Mart helped pave the way along with other competitors such as Target and K Mart. Since then Wal-Mart has grown into one of the top retailers in the United States, and are currently in the process of trying to establish themselves into international markets.A key to Wal-Mart’s success is their competitive advantage of low prices – lower than any of their competitors in the discount retail industry. Being a top business does not exempt one from problems. Over the years Wal-Mart has been one of the most scrutinized businesses in America.
Wal-Mart has had to deal with employee disputes over health benefits, wages, hours, and labor. They have faced opposition from the communities, banks, elected leaders, and unions in many of the small towns they have expanded to.Many argue that Wal-Mart stores can have a negative effect on the community, because Wal-Mart has driven out other local competition by driving the prices down. Another issue with Wal-Mart Stores is the perceived quality of their products which is considered marginal. In recent news there are several accounts of product recalls, and there are numerous consumer reviews of poor products purchased at Wal-Mart Stores. Wal-Mart’s goal is to treat their customers like family while providing them with quality goods at lower prices, and, the issue of quality being sub-par is a major issue.This quality problem, coupled with being closely scrutinized by all of America, has lead to the deflating of Wal-Mart’s image.
The challenge facing Wal-Mart, especially in this trying time of economic hardship, is to boost its perceived value to the customer by improving the quality of their goods while keeping themselves differentiated from their competitors. Keeping costs of running their business low will in turn allow them to continue to offer low prices to their customers. There are several options that a major company is faced with that will take their company in different directions.There are two drastically different options to follow that Wal-Mart should analyze and take action with. One option is more organization with the individual stores while the other has to do with completely changing the structure of the company. In becoming and also staying a major coming in an industry money and time must be spent to stay at the top. By unionizing a company such as Wal-Mart, the costs would be very great in initial start up while they may knock down future legal costs.
By reorganizing the stores and creating a new atmosphere, there is less start up costs but there is no room for structure change. There are tradeoffs that all companies are faced with and any option that is analyzed is important to the life of the company. Ch. 1 Introduction 1. 1Mission Wal-Mart’s mission statement is simple, “Saving people money so they can live better. ”[i] This statement has lead to Wal-Mart leading the way within the discount super-store industry for the past thirty years. 1.
2History[ii] A brief history of Wal-Mart begins with Sam Walton, the founder of the chain. Mr.Walton did much research on consumers to prepare the way for his dominating chain, and in the process he found that what consumers want most are quality products at affordable prices. Mr. Walton opened his first Wal-Mart in 1962 in Rogers, Arkansas. Within five years the chain grew to 24 stores and already they had sales in the billions of dollars. During the 1960s the discount store market experienced exceptional growth; however, Wal-Mart did not have enough money to expand to more expensive areas.
Instead they continued to expand in areas of relatively lower populations and continued to thrive.In 1972 Wal-Mart had its initial public offering and experienced monumental growth, jumping to 262 stores in eleven different states. Through the 1980s and 1990s Wal-Mart’s success continued to flourish, and they were ranked in Forbes magazine as a top retailer throughout these times. The 1990s also saw Wal-Mart’s introduction into the international market, which they are still in the process of trying to integrate. Continuing into the 21st century Wal-Mart holds within the top-ranked retailers. 1. 3Background The first Wal-Mart started up in Roger Arkansas in 1962.
Wal-Mart bases their culture in the way they treat each other, “it’s our special way of doing business. [iii]” Sam Walton is the founder of Wal-Mart and is the person that gave the company the sense of honor and values which Wal-Mart holds at a very high standard. Today there are over 7,390 Wal-Marts and Sam’s Clubs stores. Wal-Mart is known as a store where you can go shop and save a buck. They are friendly to the average consumer of moderate income, and in this market they have thrived. They are a highly competitive company in an industry and economic time where lower prices are exactly what consumers are looking for.Wal-Mart has found that the reason they are so competitive is through their cheaper prices as compared to most of their competitors.
This can create an effect so that many suppliers fight over their business. This in return gives Wal-Mart great bargaining power over whom they buy products from, and they can basically manipulate the original system/relationship of suppliers and retailers. They can almost in a sense control what price suppliers offer. Wal-Mart has great deals, and those deals can bring almost anyone into their store.Wal-Mart has a vast array of customers, most of which at some point or another probably were loyal customers of another company who opposed the idea of Wal-Mart entering in their community. At some point or another most of these same people have gone into Wal-Mart to see what all the hype is about – and they found it in the low prices. Ch.
2 Internal and External Analysis 2. 1Internal Analysis – VRIO Within this section is discussed Wal-Mart’s internal analysis of the value brought to and perceived by the consumers through the value and rarity of their products, imitabiliy of their practices, and organization.By evaluating these four categories within their company it is easier to appraise which areas are strong and which are weak and, subsequently, need revision. To begin the main resources and capabilities of Wal-Mart Store’s Inc. must be identified. As with many companies a major resource of Wal-Mart’s is their human capital; another is their image – concerning their layout of their stores, product quality, and satisfaction of their employees; Wal-Mart’s products and brands are a valuable resource; and Wal-Mart’s geographic locations are an important resource. [iv] 2.
1. 1ValueAccording to Barney and Hesterly the question of Value is, “Do resources and capabilities enable a firm to exploit an external opportunity or neutralize an external threat? ”[v] In order to account for this within the resources and capabilities listed above it is important to compare it to the environment of the industry as a whole. With regard to the super-store or any market industry, employees are an important factor. It is true that at a store you buy goods, however, service is a major factor because the mood of the employees directly affects the mood of the consumers. vi] It can influence everything from what they buy to whether or not they return to the store or even the company. It is important that employees be helpful, courteous, energetic, knowledgeable, and happy. Wal-Mart has a history of bad relationships between the organization and its employees.
A main complaint that Wal-Mart has had to back up on numerous occasions is that the wages are not on par with the general market wages. [vii] This basic problem can create a disconnection between lower-level employees and management, and disgruntled workers, as stated above, are not good for any business.These ailments do not lead to a competitive advantage for Wal-Mart in human capital. The image associated with Wal-Mart can be directly related to the quality of their products, store layout, and employee satisfaction. Employee satisfaction has already been established above as less than optimal. Quality has been a great issue with Wal-Mart in the past and currently, which conflicts with their mission of “quality products”. Recent product recalls seen in newspapers involve an infant crib that has design flaws that are potentially dangerous and possibly life-threatening.
viii] This is just the most recent accusation of poor product quality from the Wal-Mart stores. There are many blogs and online forums where customers may go and rant about issues they have with Wal-Mart products. Because of this the brands and brand names that Wal-Mart sells are also hurt when the quality is compromised. Continuing questions about the quality of Wal-Mart’s products leads them into a struggle for a competitive advantage within the image category. Geographical placement within the super-store industry is important because of the customer base.In order to sell a product there has to be someone willing to buy it and currently Wal-Mart struggles to enter into urban markets. Wal-Mart has generally been met with opposition from unions, elected leaders, and banks upon trying to enter the more urban markets[ix].
This restricts Wal-Mart to smaller, more rural areas where, in fact it has worked to their advantage. Their creed of lower prices relates well to the locals communities around their establishments. This has worked to their advantage in the past. For the future, however, it may not be enough as their entrance into international markets may be stifled. x] 2. 1. 2Rarity The competition in Wal-Mart’s industry is intense.
Main competitors of Wal-Mart’s are stores like Target, Sears, Home Depot and K-Mart, all of which sell commercial items at marked down prices. [xi] The competitive advantage for Wal-Mart has been the difference between its competitor’s prices and their own. The rarity of Wal-Mart’s resources and products are not a source of competitive advantage within their industry, however, the differentiation in the prices offered by Wal-Mart are currently a source of competitive advantage. Employees at Wal-Mart range from all ages and ethnicities.Wal-Mart is an equal opportunity employer and they employ anyone from ages 15 and up. [xii] It is not an education-based job, meaning it is not necessary for a lower-level employee to have a college degree or even a high school diploma to work there. This can have an adverse effect on what employees bring to the table because, typically, if one goes on to higher education they are more likely to seek specific types of jobs, not working as a department store employee, and are, therefore not available to bring their intellectual capital to Wal-Mart’s table.
xiii] On the lower level employee plane, the Wal-Mart employees are not a source of competitive advantage. In the case of rarity of their image Wal-Mart is one for the people. The Wal-Mart mission plainly states, “Saving people money so they can live better. [xiv]” Sam Walton’s goal was that of improving the lives of the average person by offering them a chance at everyday products with lower prices. This image of “for the people” is unique to the industry in that it is written down for Wal-Mart, and in that sense is a competitive advantage.Geographical location has worked for Wal-Mart in the past, as stated above, and this is generally due to the scarcity of larger, hyper-stores within the rural markets in which they are situated. By offering many products in one place, and at considerably lower prices than competitors, it has allowed Wal-Mart to be very successful in revenues and profit margins.
This has been a large source of their competitive advantage in the past. 2. 1. 3Imitability According to Barney and Hesterly the question of imitability is, “Do firms without a resource or capability face a cost disadvantage in obtaining or eveloping it compared to firms that already possess it? ”[xv] With regard to their human capital there is no outstanding difference between Wal-Mart’s practices and the practices of their competitors, therefore there is no superior advantage. Similarly, through their products and brands there is no sustained advantage for Wal-Mart. As a super-store Wal-Mart sells many different brands, and many different types of products. For example, clothes, electronics, groceries, and medications are all examples of types of products sold in Wal-Mart stores.
At the same time, within product lines Wal-Mart offers many brand names such as Sony and Sanyo within the electronics product line. However this is not dissimilar from what Wal-Mart’s competitors practice; neither Target nor Costco specialize within product lines or brands. Therefore, there is no direct advantage. Imitability with regard to the image Wal-Mart portrays is an advantage for the super-store in certain aspects. Wal-Mart’s competitors, such as Target and Costco, are based around the same strategy as Wal-Mart of paying less.Target states, “Connecting business and community, affordability, and great design,[xvi]” as part of their mission. The key factor for Wal-Mart in the past and present has been the price differentiation between their competitors in offering an even lower price.
There is only one way to sustain this – by stock-loading their shelves with more products to sell to offset their lower prices. This has worked for Wal-Mart strictly because for many people the benefit of having more money is enticing.It would be difficult for a company such as Target to imitate the low cost strategy applied by Wal-Mart. The capability of Wal-Mart selling their products at a lower price is an advantage, however, as mentioned above, poor quality is a negative factor. For this reason Wal-Mart’s image imitability ranks in-between. Coinciding with the image of Wal-Mart is the imitability of their geographic location. Wal-Mart began in a small town, Rogers, AK, and during the 1960s, as its competition expanded, Sam Walton could not afford to do the same.
xvii] This enabled Sam Walton to expand in the smaller, niche market of rural areas. This gave Wal-Mart opportunity in the fact that their customer base was looking for exactly what they were giving, always low prices. This began their domination in a separate market from that of their competitors. 2. 1. 4Organization Organization refers to each aspect of the VRIO model listed above, Value, Rarity, and Imitability, and evaluates how the firm exploits its resources and capabilities in order to take full advantage of them. xviii] How well does the organization itself, from top management down to lower-level employees, work together to make use of their competitive advantages? In recent years Wal-Mart has taken public hits when it comes to issues with their employees.
According to a recent Business Week article Wal-Mart employees can earn up to 20% less than the average retail worker, and along with that, not many of their employees are enrolled in their health care plan because it is “costly. xix]” This creates a disconnection especially between top level management, who, in American economies especially do no less than very well, and lower-level employees such as customer service employees in the Wal-Mart stores. This can create a problem as Wal-Mart tries to continue their practice of treating their customers like family. Lower-level employees are the most hands-on with customers and if employees are unhappy it will generally show in customer activity. 5. VRIO Visualization Table |Value |Rarity |Imitability |Organization |Competitive Implications | |Employees |N |N |N |N |Weakness | |Image |N |Y |Y / N |Y |Toss Up | |Products / Brands |N |N |N | |Weakness | |Geographic Location |Y |Y |Y |- Strength | 2. 2External Five Forces Analysis To compliment an internal analysis a firm performs an external analysis in the form of a five force analysis.
This analysis identifies the environmental threats of the industry in which the firm is competing. These environmental threats are any individual, group, or organization outside a firm that seeks to reduce the level of that firm’s performance. [xx] The five force analysis consists of the threats of entry, rivalry, buyers, substitutes, and suppliers. . 2. 1Threat of Entry Wal-Mart had close to $400 billion dollars in revenue last year[xxi], so because of its sheer size, new market entrants are not much of a threat to the company. In order to become a competitor in the one-stop-shopping market, a company wanting to compete with Wal-Mart would have to open, at a minimum, hundreds of locations all over the country.
The brick and mortar retail industry would be incredibly costly to start up in, which would be a major barrier for new market entrants.Because Wal-Mart is purchasing products for over 7000 stores, they are also experiencing massive economies of scale due to suppliers being able to offer lower unit prices. Wal-Mart has also created a high barrier of entry through its supply chain management system, which has pretty much automated their entire supply chain. This system helps them secure distribution channels, lower their operating cost due to a just-in-time approach to inventory, and lock in suppliers because of the size of their business.When an item is taken out of inventory, their system automatically orders another from the manufacturer and lets the entire value chain know about the change in demand. [xxii] Wal-Mart has had a level of control over their suppliers that new markets entrants could only dream of after they have established themselves. The Wal-Mart brand in itself could also be considered a barrier of entry as it is a renowned brand name for one-stop-shopping.
2. 2. 2Threat of Substitutes The amount of substitutes available for customers highly depends on whether or not the customer is looking for a one-stop-shopping center.Wal-Mart carries a lot of products that can be found in a lot of specialty stores, as well as their main competitor’s stores. If someone is out shopping for a TV, the amount of substitute retailers’ increases from their main competitors like, Target and Costco, to specialty stores such as Best Buy and Circuit City. In cases like this, where a customer is only looking for a couple certain items, the amount of substitutes that are available can increase greatly, and become a threat to Wal-Mart.On one hand, if a customer is shopping for several things such as furniture, clothing, and a TV, searching for different substitute retailers will take a lot longer time and effort, and the prices will probably not be close to the low ones Wal-Mart would offer for the same product.
Going to Wal-Mart can in this case seem to save time and money as there is no need to go out of one’s way to complete a shopping list. In these there are few retailers except for Wal-Mart that offer this sort of one-stop-shopping combined with low prices.Cost-Co, which is one of Wal-Mart’s main competitors require customers to purchase a membership card just to be allowed to shop there. Shopping at Cost-Co could therefore be seen as a major turn-off for customers who are very price sensitive in the first place. Target would be another of Wal-Mart’s main competitors, but they offer far less locations than Wal-Mart, and have a much smaller market share. 2. 2.
3Threat of Suppliers Wal-Mart is an incredibly large retailer with over 100 million customers each week[xxiii], and has therefore, a lot more influence with their suppliers than a smaller company, for example, Albertsons, has with theirs.Wal-Mart purchases products in large quantities for their more than 7000 worldwide locations[xxiv] and uses one of the worlds’ most advanced inventory management system, noted above, which directly communicates with their suppliers. The system they are using automatically submits an order with a supplier once a shelf is getting empty and pays for the shipment. Wal-Mart does not want to sit on millions, or even billions, of dollars worth of inventory, and by using this just-in-time ordering process they are saving a lot of money by letting their suppliers store their inventory for them. xxv] This logistics system, combined with the sheer size of Wal-Mart’s business and market share gives them an incredible control over their suppliers. Wal-Mart has been known for demanding a lot in terms of service and price cuts from their suppliers. Several have actually gone out of business just by losing Wal-Mart as a client, or being unable to keep up with Wal-Mart’s demand of lower prices.
[xxvi] There are probably dozens of companies that would jump at the chance to get Wal-Mart as a client if Wal-Mart was to lose one of their suppliers. This makes the threat of suppliers to Wal-Mart close to none. 2. 2. Threat of Buyers Buyers are a constant threat to Wal-Mart because of the amount of retailers that exist in the market, and they, like any other business depend upon their buyers to exist. Wal-Mart is preferred by many because it caters to their price sensitivity and it is convenient, but other factors such as product quality and personal values will also have effects on a buyers purchasing decision. There are people that shop at Wal-Mart because they cannot afford to shop anywhere else, but customers that can afford to shop elsewhere may do so if they are dissatisfied with Wal-Mart and the quality of their products.
Customers on a small budget might find the low priced entry point products appealing, and will make their decision based solely on the price of the product. Beating Wal-Mart’s price for an entry level product, brands aside, is a pretty hard thing to do, but there are other retailers that offer better quality products than Wal-Mart. If a customer wants a higher quality product they might end up paying more, or being unable to find the product they want at Wal-Mart, and at this point the customer might decide to take their business elsewhere.This would especially apply to more expensive products such as TVs, cameras, and computers. Convenience also plays a large factor in a customers purchasing decision. Wal-Mart stores are incredibly large and are usually located outside of city centers. Inside there are a dozens of isles and multiple departments, as well as a lot of people.
Because of this, Wall-Mart’s size might be a threat to them, as customers who only need groceries or a small item might choose to shop at a local store, as it can take a lot of time to get in and out of a Wal-Mart.The personal values of customers could also pose as a potential threat for Wal-Mart. A lot of people like to shop at Wal-Mart for their “Always low prices”, but people are becoming aware of some of the effects Wal-Mart’s pricing strategy has had on the economy, their employees, and their local communities. The company has been criticized in the media for giving far below average health benefits for employees[xxvii], forcing local companies out of business by using a below-cost pricing strategy[xxviii], and importing more than 70% of their items from China[xxix], which is in turn hurting American industries.Social impacts like these could conflict with a customer’s personal values, and customers could go shop at different stores. In other words, the business decisions Wal-Mart makes to ensure their low prices could be a factor in losing customers if their decisions are not socially acceptable. 2.
2. 5Threat of rivalry The retail industry is a very intense when it comes to the amount of companies operating within it. Even though Wal-Mart is one of the world’s largest retailers, their main competitors are not regular retailers such as QFC or Best Buy.Wal-Mart is more of a low profit margin one-stop-shopping retailer where customers can get everything they will need from lower priced TVs to groceries and clothing. Companies that are close rivals to Wal-Mart would include companies such as Target, Cost-Co and Carrefour[xxx] that also offer a wide range of one-stop-shopping consumer products. Because these companies operate with a generally low profit margin on their products they must increase their sales in order to cover their fixed costs.Because these companies sell a lot of the same brands, there can be fierce competition as a competitive based pricing strategy is a common way to get a temporary advantage.
2. 3Problem Statement A main issue that Wal-Mart Stores Inc. faces is the perceived negative image attributed to them from both inside and outside the organization. Wal-Mart faces numerous lawsuits and accusations from the general public and from their own employees on the quality of their products, their harsh labor practices, and the overall environment of their stores.Wal-Mart must reposition their image in order to improve their image with the general consumers while at the same time keeping their cost advantage. Quality High Target Costco Price (Low)Price (High) Wal-Mart Quality Low Ch. 3 Strategic Options 3.
1Option 1: Unionize • If Wal-Mart allowed for unionization, their perceived image will change dramatically. They will be viewed publicly as a caring employer that offers better benefits which will attract better workers thus creating better customer service and longevity of their employees. 3. Option 2: Reorganize and un-clutter the isle ways and shelves. • The stores will attract more customers because the stores will be much cleaner and easier to walk through. • This will also give the impression that the store is less of a discount store and perceived value could potentially increase. Ch.
4 Strategic Option Evaluation 4. 1Strategic Evaluation of Unionizing Wal-Mart owns or controls the majority of its industry so changing anything in their operations may be a bit absurd; however, it does mean that it is okay to become lax in everyday operations or with the push for more market share.Companies must always keep reinventing and improving themselves and their products or services to not only compete in their industry or sector but to succeed in it as well. With an ever tarnishing image, Wal-Mart has to work even harder to clear their name from bad press and business practices. Wal-Mart is a multi-billion dollar company whose top executives are some of the richest in the country, however, their employees are barely making minimum wage at the highest, and are facing the harsh reality of being unable to support their families. [xxxi]In 2003, Wal-Mart claimed that cashiers earned and average $7. 92 throughout the country.
This would be minimum wage at this time, unfortunately, Wal-Mart does not allow for employees to work more than 30 hours in a week so there is less of a chance of an employee working overtime and thus requiring them to provide benefits or increased wages. As a multi-billion dollar company, providing benefits would be a great opportunity for Wal-Mart to help employees and the economy but it will also help revive the company’s current image into something much more positive.A union would help establish and maintain the program plus it would also create team unity which in turn would create a more positive work environment. The cost of implementing a union would be great; however, the potential earnings from the new business they could find would make the change worth it. Not only would it bring more customers to the store, it will cut down on its lawsuits. In 2005 alone, the company paid $172 million dollars in lawsuits for not giving meal breaks. [xxxii] This does not include any other lawsuits for other mal practices.
A union may even cut costs because the company would be held to more strict guidelines. 4. 2Strategic Evaluation for Reorganizing Store Isle Ways and Shelves When a person pictures the inside of a Wal-Mart store they think of narrow isles and fully stocked shelves. The main isles ways at Wal-Mart are commonly cluttered with large displays which create only small passages for its patrons. The large area is often shrunk so small that only one cart can move on either side of the displays.Many of these displays contain rock bottom prices; however, if the shoppers cannot maneuver around others who are looking at these displays, the chances of disputes occurring or people simply leaving the stores could arise. More “Clearance Isles” or end caps could increase the space for shoppers to move and show the vast amounts of space in the stores.
Even though the stores are very large, the cluttering of items gives the illusion of a small, cramped space. With less isle displays, it will also bring more customers through the isles and thus give a potential for greater sales.The shelves are always stocked to their limits as well. By having the shelves packed to capacity, there is a chance to have expired food on the shelves or items on racks that are very old and priced incorrectly. There has already been a case in New Jersey in 2008 that baby formula had been expired for sometime but was still on the shelves. [xxxiii] This is one of the reasons why leaving more space on shelves could help give better customer service and work on their image. Leaving the shelves bare is not the answer however, being able to organize, stock, and restore foods is very important.
The chance that expired food is on the shelves is much greater if items are being forgotten about on the backs of shelves. By having the ability to circulate the items more properly, the quality of the food for example, will increase and the satisfaction by customers will grow. A returning customer base will also increase which will also bring more in to stores. 4. 3Recommendation and Plan of Action The ultimate goal is to remain a leader in its industry for Wal-Mart. Because it contains the largest share of the industry, a subtle change should be implemented. Option number two would be the best and less expensive option to go with.
The option is to rearrange the store and leave it less cluttered and more maneuverable for shoppers. Although implementing a Union has the potential of reducing legal costs significantly, it will be a very expensive up front cost, and its overhead will still increase. The initially cost of removing some, but not all displays from the main isles would be much less than setting up a Union. The best way to begin to re-order the “look” of the Wal-Mart stores should be slow so customers can see the changes going on and so they also know where the display items are moving to.That is why separate isles for these displays would be ideal. With their own isles, customers can still have the incredible deals they are receiving, plus there will be a lot more space for people to walk around and maneuver carts without bumping into displays or other shoppers. This plan will also make the store look cleaner and more shopper-friendly.
4. 4Competitive Advantage The size of Wal-Mart is the main component to being an industry leader. Because the company is so large, they are able to provide extremely low prices and still continue to make great revenue gains each year.Since one major component to their advantage has to do with low prices, the perception of quality is a significant weakness. The way to increase its already major advantage by changing the perception of its quality as stated in previous sections. The size of the company does not only correlate between revenue and sales but also the number of stores and the number of cities that are represented. Wal-Mart has stores in most major cities and if not, there is one close by.
Being open 24 hours is also a major advantage for Wal-Mart. Most of their competitors are unable to stay open 24 hours. The ompetition at night for Wal-Mart mainly consists of pharmacies or general stores that are more expensive and have smaller selections. 4. 5Implications Price is not only the determining factor to appealing to customers and growing a clientele base. Quality is another major point that consumers are looking for and with inferior products or services; many customers could become only one time shoppers. Return business is very important and a major company such as Wal-Mart would not be able to survive without it just like any other business.
The reputation of a company is important and Wal-Mart’s is definitely tarnished and in need of revival.Being only a discount store is not what Wal-Mart should be with the magnitude of its reach. It does not make a difference of how big you are if your reputation and quality are poor. Being a well rounded company is very important in business and keeping customers coming back, and having satisfied employees is essential to the life of any venture.Endnotes ----------------------- [i] Wal-Mart. Our Purpose. In About Us [Online].
Available: http://walmartstores. com/AboutUs/8123. aspx [2008, September 27].
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