Wal*Mart’s: 2004 & 2003
Sales, Earnings, and Financial Ratios
By: Tony Ego
St. Ambrose University
How did a peddler of cheap shires and fishing rods become the mightiest corporation in America? Wal-Mart’s founder Sam Walton had combined folksy charm and home spun business wisdom with cutting-edge information technology and supply chain management to create the world’s most efficient retail organization.
Wal-Mart’s transformation form a small chain of discount store in Arkansas, Missouri, and Oklahoma in 1970 to the world’s largest retailer was one of the most remarkable corporate success stories of the twentieth century.
Sam Walton opened his first store a franchised Ben Franklin variety store in 1945. Over the next 15 yrs. Sam together with his brother, Bud developed a chain of 15 Ben Franklin stores throughout rural Arkansas. During this period, Sam Walton became aware of the increasing price competition from discount retailer- large format stores that offered a broad range of products that included apparel, appliances, toiletries, household goods, and sometime groceries as well. This new category of retailer began to emerge in the U.S. after World War 11. Discount stored were located within large towns- it was generally believe that the population would have to generally be 100,000 in order for discount stores to be viable. Sam Walton believed discount stores could be viable in small communities, and if the prices were right it would attract customers from other areas. His strategy was to put stores in to small towns that everyone else was ignoring. Walton opened his first Wal-Mart in 1962 and within eight years he had 30 discount stores in small and medium town ...