Walmart

Running Header: A Case Study on Wal-Mart Stores Inc. A Case Study On Wal-Mart Stores Inc. (Today’s Top Retailer Store) Jarita Williams University Of Phoenix COMM/ 215 Group ID# GA10ELC098 January 11, 2011 Ms. Gloria Wadsworth Doucette, MA Wal-Mart Stores Inc. is the largest retail company in the United States and has been ranked number one on the Fortune 500 Index by Fortune Magazine. Wal-Mart’s public affairs strategy must work to make implementation of these policy goals happen. Its public affairs strategy enables the company to move into other sectors of the marketplace and expand into foreign countries. The public affairs strategy also involves gaining access to politicians who can help Wal-Mart achieve its goals. Wal-Mart has a very active Political Action Committee that gives almost a quarter million dollars annually. While Wal-Mart’s public affairs strategy works well with its corporate strategy. They feel that there are a few recommendations which could make the company work better. Recently, Wal-Mart has been criticized for their opposition to allowing their employees to be unionized. Wal-Mart needs to clarify their reasons for their opposition to unionization. As a Wal-Mart shopper I feel that union is always good in a large corporation if gives the employees stability. The public affairs strategy must also address the bad feelings harbored by some groups who feel that Wal-Mart is encroaching into far too many other sectors retail than it should. I feel these concerns must be addressed to Wal-Mart as soon as possible if they would like to continued success in creating positive name recognition. Wal-Mart will need to implement these recommendations if they are going to stay at the top of the Fortune 500, while at the same time keeping a good reputation and making their more popular with cheap prices and good quality merchandise. Presently Wal-Mart is the largest retail store in the United States, and is larger than any other retail chain in the world. Wal-Mart operates over 4,150 retail facilities globally. Also, the company is the dominant retail store for Ex: Canada, Mexico, and the United Kingdom. According to the Fortune 500 index of the wealthiest and most powerful corporations in the world, Wal-Mart holds the number one spot, ranked by its total sales. The company is ranked as the second most admired company in the world. Wal-Mart provides general merchandise: family apparel, health & beauty aids, household needs, electronics, toys, fabrics, crafts, lawn & garden, jewelry and shoes. Also, the company has a pharmacy department, Tire & Lube Express, and Photo processing center as well in their stores their goal is to make Wal-Mart a one stop shop. Sam Walton created Wal-Mart in 1962, he had three policy goals that would define his business: respect for the individual, great customers service, and determine for excellency.Wal-Mart's corporate management strategy involves selling high quality and brand name products at the lowest price. In order to keep low prices, the company reduces costs by the use of advanced electronic technology and warehousing. They also negotiates deals for merchandise directly from manufacturers, eliminate the middleman to save money. Wal-Mart's community outreach focuses on the goals of providing customer satisfaction, involving local community services, and school scholarships within the community for the children and environmental issues During the 1970s, the retail industry became highly competitive, but, at the same time the economy became weak due to increases. Sears was the leading retailer in the nation, during the 1970s, however, the recession of 1974-1975 and the inflation affected Sears adversely. Sears targeted more towards middle class families and expanded its overhead. Wal-Mart's strategy was to compete with its rivals and lower expenses. Compared with Sears, which consisted of more than 6,000 distribution centers, Wal-Mart had only 2,500 comparable units. Wal-Mart grew rapidly during the 1980s due to diversification of the company. Wal-Mart's fundamental business principles at that time were to provide "high-quality and affordable brand name merchandise at low-prices and to locate stores in many small towns. Here are some Example: Wal-Mart looks at three successful elements of strategy formulation and a fourth element, strategies that are implemented successfully. • To stand out in the retail market wherever there were a Wal-Mart present • Growth and Expanding in the US and Internationally. • To build an intensive name gratitude and customer satisfaction with the Wal-Mart brand, and combine the retailer with a great reputation of offering the best prices than any other retail store. • Branching out into new subdivision of retailing such as placing pharmacies, automotive repair, and grocery sales. A key strategy of Wal-Mart is to dominate the Retail Market Everywhere. Wal-Mart focuses more on small-towns first, and then move to large cities for more rapid growth. Unfortunately, the challenges that Wal-Mart has offend tends to hurt the existing local independent merchants. . In addition, the chambers of commerce account that the onset of Wal-Mart providing jobs for people and a more diverse opportunity for local merchants by adapting to the new business environment. Others feel Wal-Mart did not nurture amiable relationships with local advertisers. Once local retail stores were eliminated, Wal-Mart began to cut back and get rid of local advertising in place of direct mailing in a centralized form. As of Today, Wal-Mart has 1,636 retail stores. There are 1,093 Wal-Mart Supercenters, 502 Sam's Clubs, 31 Wal-Mart Neighborhood stores and 1,183 international stores (www.walmart.com). Wal-Mart retail business can be divided into four retail divisions: for ex: Wal-Mart stores, super centers, Sam's Club warehouses and neighborhood markets. Wal-Mart stores and Super centers provide "one-stop family shopping"; combining groceries and general merchandise departments. Sam's Club is the nation's leading members-only warehouse club. Neighborhood Markets offer a more convenient shopping experience for customers who need the following items groceries, pharmaceuticals and general merchandise. Internationally, Wal-Mart has more than 1,000 stores in nine countries. (www.walmartstore.com Retail Division. Sam's Club provides more discounted prices for members by eliminating the middlemen by buying directly. The founder Sam Walton intended to implement deep discounting which was designed to provide 40- 60 % discounted prices for customers. Therefore he focused more on supermarket and super drug store businesses for most part. When Wal-Mart first arrived on the scene with their low prices, K-Mart stores was unable to discount brand-name products. Customers wanted to buy good quality brand-name products. But however K-MART could not maintain constant low prices with its name-brand products. In today’s time I feel K-Mart and Sears could never beat Wal-Mart due to several reasons: First of all Sears' prices are higher than Wal-Mart's & K-Mart declined in customer appeal because it deserted its store environment reputation and could not provide satisfactory to their customers. There were many complaints of poor customer service & low budget merchandise at K-Mart. Wal-Mart made customer satisfaction and neat store environments a high standard goal. In Today’s world, Wal-Mart's competition in the retail market are K-Mart and Target, which come in arrears of Wal-Mart in the US retail market. Wal-Mart is also on top of their game because of the management strategies they employ. The management strategies of Wal-Mart emphasize its workforce and its corporate culture; that being a morally conservative, religious, and family-oriented business (Vance, 163). Wal-Mart emphasizes how it listens to the needs of its workforce so that each employee is able to suggest improvements to company policy and practice. At Wal-Mart, store employees are called “associates." . The company offers generous financial rewards for employees like profit-sharing plans such as stock-purchase options. Also the company provides comprehensive training programs for all employees. It should be noted that most Wal-Mart employees do not get paid good wages. Most Wal-Mart's employee base work at Wal-Mart stores. They are part time workers who are paid minimum wage. Most employees are not entitled to any benefits, as it takes a part-time employee over five years to become eligible for any of the following benefits, profit-sharing, or other such compensation a mostly they are the ones that work themselves to death.. There is a high turnover rate among these employees, which means most do not reach the requisite level of seniority. In many cases like this local minimum wage is below standard. In conclusion, Wal-Mart is the number one retailer in the United States and is at the top of the Fortune 500 listing. Wal-Mart conducts in many countries world-wide and is moving into new countries every year & day. Wal-Mart is also expanding as a retailer. In order for Wal-Mart to stay on top of their game will be to focus on the company strategies and achieve their key policy goals, in order to keep there reputation. REFERENCES www.walmart.com, Fact Sheets, various, 2001, 2002, Found on "News," "About Wal-Mart," and "Investor Relations" sections. www.walmartfoundation.org www.fortune.com "Wal-Mart a Growth Company." MMR: May 14, 2001: 54.