2. • The company was founded by Sam Walton in
1962, is headquartered
in Bentonville, Arkansas.
• Wal-Mart has 8,500 stores in 15
countries, under 55 different names.
• No. 1 Retail giant topping in Fortune 500 Inc.
3. COMPETITVE ACTIVITIES FIT & SCOPE TRADE-OFFs
ADVANTAGE
- Economies of scale
Efficient distribution; match
1. Distribution e.g. cross-docking, volume-based strategy - Expense
Capabilities predominance of - Cost savings from - Requires
WalMart’s lower inventory partnership
own distribution levels relationship with
centres, and “inside- - Cost-savings can suppliers
out” translate into - Requires
location strategy lower prices and more sophisticated IT
customer
Satisfaction
Wal-Mart integrates - Improves supply chain -Relatively high
2. Partnership suppliers via IT and and lowers cost of goods
Relationship treats them well in distribution costs sold
with Suppliers terms of pricing; they - Additional cost savings - Requires
are more partners than from elimination of integrated IT
“value takers” manufacturer reps - Access to sales
& inventory info.
4. COMPETITVE ACTIVITIES FIT & SCOPE TRADE-OFFs
ADVANTAGE
- Useful data for suppliers
- Improves customer
3. Advanced satisfaction through more
Data-Mining Active collection accurate forecasting of
and usage of demand Expense and time
customer purchase - Improved matching of
behaviour info supply and demand, creates
superior sales/ sq ft
- Improves customer
satisfaction through low - Only possible so
4. EDLP Maintenance of prices long as you really
“EVERY - Matches volume-driven have the lowest
DAY LOW strategy prices
PRICES” - Drives down costs through
less advertising.
9. • One Idea is to use micromarketing, where
stores are clustered into groupings based
on their specialized markets, Wegmans
can utilize micromarketing by offering
Large packs for stores in family-oriented
neighbourhoods and prepared single-
serving portions for stores with a high
proportion of single residents.
10. • Costco can adopt unbundled pricing in order
to curb cost. In this way, it can charge
separate prices for an
appliance, delivery, installation, and carting
away of the old appliance. This unbundling
strategy satisfies the needs of both the low-
cost segment and full-service customer
segments. Unbundled pricing also enables a
retailer to match the price of low-cost retailers
that do not provide ancillary services. It also
charges customers for only those services
that they desire.
11. • Another strategy is to adopt E-commerce,
Many bricks-and-mortar retailers have web
sites that offer a different selection of
goods and services. Some retailers use
the Web as a means of promoting the sale
of closeouts and broken lots. Both
Wegmans & Costco must use the Web as
a means of selling distinctive merchandise
that appeals to markets too small for their
traditional store-based channel.
12. • Wegmans must exploit the these two key
market segments in order to compete with
Wal-Mart:-
• Organic & Frozen food Segment, and,
• Backward Integration into Supply Chain
13. • Costco although having mass loyal
customer base but it always ignored the
power of E-commerce. Costco should
deveop an online ordering system and
delivery service, which allows customers
to browse Costco products from an online
inventory and have them shipped directly
to their homes or businesses.
14. • Wegmans Family owned management
structure emphasized only on having
business in certain cities where their roots
exists. In this global war of retails
Wegmans must review its business
expansion strategy in the means of
Transnational as well as Remote Domestic
market.
