Company Overview: Walmart Inc Is An American Multinational R ✓ Solved

Company Overview Walmart Inc is an American multinational retail

Walmart Inc is an American multinational retail company, headquartered in Bentonville, Arkansas. The company operates 11,510 stores and clubs in 27 countries. Walmart is recognized as the largest company regarding revenue and the largest private employer globally. The company's primary objective is to provide safe, affordable food and products worldwide while fostering environmental and social sustainability and economic opportunity (Ellickson, 2016).

Walmart's product offerings include a variety of retail services, private-label brands, on-demand digital streaming services, and household brands. The retail business encompasses foodstuffs, electronics, beauty products, and household items, among others. Although there was a decline in international sales in 2020, they still contributed nearly 25% of the company's revenue, with net sales reaching $120.1 billion (Walmart Inc, 2020). This decrease can be linked to the global economic conditions affecting retail operations during that year.

Walmart's strengths include its immense size, which promotes economies of scale and access to considerable funds for growth. The company also boasts an efficient supply chain, bolstered by technological advancements, providing a competitive advantage by mitigating market risks. However, the company has weaknesses, such as its cost leadership strategy that is easy to imitate and thin profit margins from its products. Walmart lacks other distinct competitive differentiators aside from price and size, making it difficult to compete with retailers that focus on quality.

Despite these challenges, Walmart has opportunities for expansion into developing countries, where demand for affordable goods is increasing. Additionally, enhancing its human resource practices to include highly qualified personnel and better training for existing employees could bolster its competitive position. Conversely, threats include the rising trend towards healthier lifestyles, which could impact sales of certain food products, and competition from both large and small retailers.

In terms of competitive analysis, Walmart's main global competitor is Carrefour. Both companies operate retail outlets selling foodstuffs, electronics, clothes, and household items. They each adopt cost leadership strategies, providing discounted prices to attract customers. Carrefour utilizes supermarkets and hypermarkets, whereas Walmart employs an intensive distribution strategy, combining physical store presence and e-commerce platforms while frequently offering promotions. Carrefour adopts a penetration pricing strategy to enforce lower prices.

The collaborator analysis emphasizes Walmart's successful supply chain supported by reliable suppliers, reducing stock-out occurrences. The company has also ventured into e-commerce, partnering with third-party sellers, a potentially risky move if quality control isn't maintained. The PEST analysis provides insight into the external environmental factors affecting Walmart. Political stability in operating countries generally favors Walmart, although the company faces pressure regarding minimum wage regulations (Nguyen, 2017). Economic factors, such as major economies' stability and growth in developing countries, present opportunities, yet changes in interest rates and inflation pose challenges.

Social factors affecting Walmart include the health lifestyle trend which opens avenues for growth. Urban migration and cultural diversity also influence retail operations. In terms of technology, the company can leverage increased automation and mobile device usage to remain competitive.

To enhance its competitive edge, Walmart should consider several strategies. First, ensuring the quality of products from third-party sellers should be a priority, enhancing brand integrity. Second, the company should focus on improving the quality of its own offerings to distinguish itself in a price-driven market. Finally, promoting its e-commerce platform is crucial as it remains relatively unknown compared to other segments, presenting an opportunity for growth.

References

• Ellickson, P. B. (2016). The evolution of the supermarket industry: From A & P to Walmart. In Handbook on the Economics of Retailing and Distribution. Edward Elgar Publishing.
• Nguyen, T. T. H. (2017). Wal-Mart’s successfully integrated supply chain and the necessity of establishing the Triple-A supply chain in the 21st century. Journal of Economics & Management, 29.
• Walmart Inc. (2020). 2020 Annual Report. Corporate.Walmart. Retrieved from Walmart Annual Report.
• Miller, J. (2019). The impact of technology on supply chain management. Supply Chain Management Review.
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• Penttinen, E., & Lintukangas, K. (2017). The role of supply chain quality in achieving competitive advantages. International Journal of Production Research.
• Smith, A. D. (2019). The future of retail: Trends and technologies shaping the global market. Retail Journal.
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• Harrison, A., & van Hoek, R. (2017). Logistics Management and Strategy. Pearson.
• Zhang, K. (2020). The health-conscious consumer: Implications for grocery retailers. Journal of Consumer Marketing.