Submitted by Susanna Sara Samuel (P12221) Steffy Treesa Thankachan (P12217)
ABOUT WALMART
Walmart is an American multinational retailer corporation founded by Sam Walton in 1939 known for discount retailing Large discount department stores and warehouse stores World's third largest public corporation (Fortune Global 500, 2012) Largest retailer in the United States, and in the world 8,500 stores in 15 countries, under 55 different names (UK - Asda, Japan - Seiyu, India - Best Price)
A NATIONAL MISSION STATEMENT
The founder, Sam Walton, believed in servant-leadership. Their mission is to serve our Associates and customers with compassion and integrity. Our emphasis is on our Associates, children, families, the local community and other local programs that improve the quality of life in our communities.
DIVISIONS OF WALMART
Neighborhood markets Sams club Super centers International Discount stores
DISTRIBUTION AND OPERATION OF WALMART
DISTRIBUTION OF WALMART
Each Distribution center divided into different section basis of quantity of goods received. Managed in both cases and palletized goods. High inventory turnover rate ,once in every two weeks. Goods meant for Japan in pallets and imported goods in reusable boxes and cases. Some cases vendors supplied directly to stores. The distribution centers ensured steady flow & consistent flow of products. Large-scale use of sophisticated technology such as Bar code, hand held computer systems (Magic Wand) and now, RFID. Every employee had information regarding products at distribution center. They make 2 scans- one for identifying the pallet, and other to identify the location from where the stock had to be picked up. The hand held computers guide employee to the location of the specific product.
The quantity of the product required from the center is entered in the hand held computer, which updates the information on the main central server. The computers also enabled the packaging department to get accurate information such as storage, packaging & shipping Transportation system: o Walmart maintains a private fleet of trucks and a skilled staff of truck drivers. o Company only hires experienced drivers having more than 300,000 accident free miles with no major traffic violation. o Drivers follow the most efficient routes to their destinations, and work to minimize the number of empty miles they drive. Cross- docking: Wal-mart also uses logistic technique called Cross-docking. In this system, finished goods are directly picked up from the manufacturing site of supplier, sorted out and directly supplied to the customers. This reduces handling and storage of finished products.
SEGMENTATION, TARGET & POSITIONING
Segmentation
Walmart uses market segmentation to determine where to open their stores and what items to stock it up with.
Target - Walmarts credo is, save money, live better this
summaries their target market, the lower-middle class and the poorer. (Low income consumers).
Positioning
Product strategy - Low prices, In-stock positions, Customer service Service strategy - Respect the individual , High standards of service Operation strategy - Short response time , low inventory , Cultural adaptation Competitive strategy - customer satisfaction , Mkt Penetration By Selecting Most Convenient Locations Acquired Or Constructed Logistic Efficiency: Speed To Market
BUSINESS STRATEGIES
Product
Food
Stationery
Automotive
Home appliances
Wal*Mart
Household chemicals & consumables
Health & beauty aids
Sporting goods
Paint & hardware
BUSINESS STRATEGIES
Place:
rural areas and Small towns
pattern of expansion:pushing from the inside out Price: Everyday-low-prices
Promotion:
Always low prices-Always
(while 2.1% for direct competitors)
-few promotion: - advertising expense: 1.5% of sales
KEY SOURCE OF WALMARTS COMPETITIVE ADVANTAGES
Successful Vendor Relationship Efficient Communication Network
LOW PRICE
Value Employees Most
Customer-Oriented
Efficient Operation Management
SUCCESSFUL VENDOR RELATIONSHIP
purchasing partnership with suppliers Efficient purchasing
Sharing information electronically low
cost
effective communication
Vendor managed inventory system
minimize inventory cost
VALUE EMPLOYEES MOST
Yes We Can Sam suggestion program
within a store
Motivation High Lower Productivity Cost
Store
Shrinkage incentive plan Profit Sharing Scheme
Management Training Program
WHY WALMART BECAME SUCCESSFUL
Competitively Reduced Cost (Puts All Gains & Savings Into Reducing Prices) Consumer-centric Sales Localization Co-operated Suppliers Store-manager Autonomy Focus on IT investments One- Stop Shopping Keep Customer Shopping: Added Food & Services Full Stock Register Full Product Line Merchandising Ladder Private Branding
