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    Wal Mart Swot Analysis

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    Maureen Derial Panta
    Wal-Mart has several strengths in its value chain including an efficient supply chain and logistics system, strong penetration strategies, and the world's largest private satellite communication system. However, it also faces some weaknesses such as unionized labor laws and poor public image. Key aspects of Wal-Mart's value chain are its efficient cross-docking operations and inventory management, relationship with suppliers, use of technology like barcodes and RFID, and emphasis on low prices through everyday low cost operations.

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    Wal Mart Swot Analysis

    Uploaded by

    Maureen Derial Panta
    419 views10 pages
    Wal-Mart has several strengths in its value chain including an efficient supply chain and logistics system, strong penetration strategies, and the world's largest private satellite communication system. However, it also faces some weaknesses such as unionized labor laws and poor public image. Key aspects of Wal-Mart's value chain are its efficient cross-docking operations and inventory management, relationship with suppliers, use of technology like barcodes and RFID, and emphasis on low prices through everyday low cost operations.

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    Wal Mart Swot Analysis

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    Wal-Mart has several strengths in its value chain including an efficient supply chain and logistics system, strong penetration strategies, and the world's largest private satellite communication system. However, it also faces some weaknesses such as unionized labor laws and poor public image. Key aspects of Wal-Mart's value chain are its efficient cross-docking operations and inventory management, relationship with suppliers, use of technology like barcodes and RFID, and emphasis on low prices through everyday low cost operations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    419 views10 pages

    Wal Mart Swot Analysis

    Uploaded by

    Maureen Derial Panta
    Wal-Mart has several strengths in its value chain including an efficient supply chain and logistics system, strong penetration strategies, and the world's largest private satellite communication system. However, it also faces some weaknesses such as unionized labor laws and poor public image. Key aspects of Wal-Mart's value chain are its efficient cross-docking operations and inventory management, relationship with suppliers, use of technology like barcodes and RFID, and emphasis on low prices through everyday low cost operations.

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    © All Rights Reserved
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    of 10

    SWOT Analysis

    Strength

    Efficient supply chain l Logistic system


    Efficient cross docking and inventory management
    Service innovation and technology
    Strong penetration strategies
    Worlds largest private satellite communication system

    Weakness

    Unionized and strict labor laws


    Unable to adopt internationally
    Poor public image

    Opportunities

    Globalization, growing middle class globally


    E-Business
    Inorganic growth leading to consolidation

    Threats

    International trade blocks and zoning regulations


    Terrorism and wars
    Strong competition in Europe
    Anti-comprehensive and anti-dumping laws

    Value Chain Analysis


    Wal-Mart takes care of all the activities internally except partially outsourcing its
    logistics requirements. Its systems integration from inventory, to stores, to
    headquarters to suppliers is the lifeline of its success. The core activity remains in
    its bulk buying and inventory management which supports WalMarts competitive advantage of pricing and every element Shows traces of cost
    leadership. Wal-Mart located, its discount stores around regional warehouses
    allowing a streamlined and low cost physical distribution
    Inbound Logistics

    Wal-Marts primary activity of receiving inventory is planned right from the point of
    production,
    which Wal-Mart is not involved with. Wal-Mart has integrated systems with key
    suppliers which communicate in real time data with sales information and stock
    status so it can replenished in time. Shipments are timed and slotted and planned in
    an orchestral way.

    Operations
    Wal-Mart maintains a lean approach to inventory. Wal-Mart innovated a technique
    of replenishment called the Cross-Docking where incoming goods are offloaded into
    outgoingtrucks directly without stocking them even for a few hours. Most goods
    pass through thewarehouses within a span of 48 hours, enabling minimum idle time
    and lowering excessinventory possibilities. Most of the goods never touch the floor
    of the warehouse, as goods arepassed on 24 miles length of conveyor belts between
    incoming trucks to outgoing trucks.
    Outbound Logistics
    Goods are transferred within 48 hours of receipt from suppliers. The replenishments
    are also
    done twice weekly, which is double the industrys
    standard.

    Marketing and Sales


    Wal-Mart maintains a simple and effective marketing strategy which it has managed
    to replicate globally apart it being the focus of its strategy. The Every Day Low Price
    (EDLP) is simple and eliminates unnecessary advertising trying to push sales, as
    Wal-Mart has successfully sold the concept to the customers, that it sells its
    products at the lowest prices,everyday. This is one of the most interesting attributes
    of Wal-Mart.
    Service

    Wal-Marts aggressive yet subtle People Greeters and in its own fashionable and proud way
    Aggressive Hospitality are the foundations for Wal
    MartS success in the highly competitive market.
    Infrastructure
    Wal-Mart maintains its own fleet of 2000 plus trucks which have scheduled
    deliveries between warehouses to stores minimizing delays and over reliance from
    suppliers.
    Human Resource Management
    Wal-Mart is the only retailer to be in Fortunes 100 Best Places to Work. Wal Marts
    empowerment of Associates is laudable with instances such as allowing its
    Associates to get on the network and lower its prices, nationwide if its found to be
    higher than its competitors, all this done without any consultation or permission
    requests from superiors.
    Technology Development
    Wal-Marts technology and inventory management systems and software are better than the
    best in the world and also the lifeline of the organization. Wal-Marts early
    innovations and

    WAL-MART GLOBAL STRATERGY.


    experimentation apart from investments light-years ahead of its time into VSAT
    capabilities have boosted its success
    Procurement
    Wal-Marts satellite communication and electronic data interchange links all its
    stores to over4000 suppliers creating the finest procurement co-ordinated scenario.
    Wal-Mart integrates its supply chain management activities with key suppliers like
    P&G with direct shipments from

    P&Gs warehouses to WaL-Marts stores and warehousees. Wal-Mart inventory


    management is so effective that over 70% of its merchandise is purchased and paid
    for by customers, even before Wal-Mart has actually paid for the same to its
    suppliers. Wal-Mart has outsourced a substantial activity to USSO enabling Wal-Mart
    to maintain its logistics cost

    #2
    VALUE CHAIN

    Firms infrastructure

    It serves over 100 million customers weekly worldwide


    There are 1,035,000 associates and the company is Americans largest
    private employer

    Human Resources Management

    The employees are encouraged to communicate openly, offer new ideas,take


    risk, strive for excellence and have fun. Employees are getting competitive
    wages and comprehensive benefits
    In recruiting new associates the company begins a comprehensive
    recruitment program in the community where the store is to identify
    candidates
    Recruitment programs are well publicized and convenient, providing an
    opportunity for job applicants and the company to start getting acquainted
    When new employees start at Wal-Mart they are presented to the two basic
    rules of Wal-Mart. These are
    1. The customer is always right
    2. If the customer happens to be wrong, refer rule 1

    Technology Development

    Wal-Mart set up own satellite communication system in 1983


    Wal-Mart uses Bar Code & RFID technologies, different processes like efficient
    picking, receiving & proper inventory control of the product s along with easy
    packing and counting of the inventories was ensured.
    Electronic Data Interchange (EDI)- a computer to computer exchange of
    business documents

    Procurement

    Wal-Marts process of procurement involves reducing its purchasing cost as


    far as possible so that it can offer best prices to its customers. The company
    procures goods directly from the manufacturers, by passing all
    intermediaries.

    Logistics

    The drivers are tracked regularly through Private Fleet Driver handbook
    Wal-Mart uses a logistics technique called :Cross Docking
    Wal-Mart today about 60% inbound freight (closer to 80% for their grocery

    segment) is managed by suppliers.


    The important of Wal-Mart logistics infrastructure was its fast and responsive

    transportation system.
    The distribution centers were serviced by more than 3500 company owned

    trucks.

    Operations

    Wal-Mart operations are comprised of three business segment


    1. WAL-MART STORES
    Super-centers
    Discount Stores
    Neighhbourhood Markets
    SAMs CLUB
    WAL-MART INTERNATIONAL

    Marketing and Sales

    Employees wore blue vests to identify themselves


    Aisles were wide
    Apparel departments were carpeted in warm colours
    A store employee followed customers to their cars to pick up their shopping

    carts
    Customers was welcomed at the door by a people greeter, who gave
    directions and struck up conversations

    Services

    Opening hours at Wal-Mart generally range from 7 a.m to 11p.m six days a

    week from 10 a.m to 8 p.m on Sunday.


    All Wal-Mart stores maintan uniform prices except where lower prices are
    necessary to meet local competition. Sales are primary on a self-service and
    cash carry basis with the objective of maximizing sales volume and inventory

    turnover while minimizing expenses.


    Banks credit card programs, operates without recourse to the company, is

    available in all stores


    The replenishment system also helps the store adjust to customers demands.
    The stores are organized the same way all over the world, so the customers
    will recognized the stores wherever they go.

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