Case 1.2 Wal-Mart Stores, Inc.
1. What is Wal-Mart Strategy?
? Wal-Mart's winning strategy in the U.S. was based on selling branded products at low cost.
? Though Wal-Mart may have been the top customer for consumer product manufacturers, it deliberately ensured it did not become too dependent on any one supplier; no single vendor constituted more than 4 percent of its overall purchase volume.
? Wal-Mart used a "saturation" strategy for store expansion. Placing a standard of able to drive a distribution center to a store within a day.
? In its early years, Building large discount stores in small rural towns.
What is the basis on which Wal-Mart builds its competitive advantage?
? Selling branded products at low costs brings Wal-Mart a total of 138 million customer visits worldwide.
? Even by being the top customer for consumer product manufacturer, no single vendor constituted more than 4 percent of its overall purchase volume.
? Saturation strategy for store expansion makes the distribution centers more efficient.
? Building large stores in small rural town while competitors focused on large towns with population greater than 50,000 gives Wal-Mart gives a step ahead its competitors in terms of reaching rural town customers and development. Development wise, it is cheaper to develop in rural town, in terms of rental and/or land acquisition, as compared to developed urban centers.
2. How do Wal-Mart's control systems help execute the firm's strategy?
On becoming the worlds largest retailer:
? Each store constituted an investme ...