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Wal-Mart Store Inc.

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<ul><li>W al-Mart Vision: Do it, try it, and fix it! </li></ul><ul><li>W al-Mart Mission: Give ordinary folks the chance to buy the same things as rich people. </li></ul><ul><li>C ore competency: Information technology </li></ul>Introduction

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Everyday low price The customer Supply Chain Management In-stock Key success factors?

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Value Chain <ul><li>Cost of Supply chain Low </li></ul><ul><li>Biggest customer & Biggest seller </li></ul><ul><li>Bottom line price </li></ul><ul><li>No funny-money cost </li></ul><ul><li>Cost of Technology Normal </li></ul><ul><li>Cost of IT lower than competitors (less than 1% of revenue, far less than other retailers) </li></ul><ul><li>Cost of automated system higher than competitors </li></ul><ul><li>Cost of Operation Normal </li></ul><ul><li>The Lighting, heating, and air-conditioning controls were connected via computer to Bentonville headquarters </li></ul><ul><li>Cost of Marketing Low </li></ul><ul><li>0.3% of sale (1.5% for Kmart; 2.3% for Target) </li></ul><ul><li>Cost of Distribution Normal </li></ul><ul><li>Truck driver cost high </li></ul><ul><li>Distribution center operation normal </li></ul><ul><li>Store construction and maintenance low </li></ul><ul><li>Cost of customer service low </li></ul><ul><li>Member card only </li></ul><ul><li>Quality of Supply chain Very High </li></ul><ul><li>Strong relationship ( “vendorville” involved in Wal-Mart future plan; Learn from collaborative effort; data sharing) </li></ul><ul><li>Little conflict due to single bottom-line price </li></ul><ul><li>Quality of Technology Very High </li></ul><ul><li>First-mover among retailers </li></ul><ul><li>Focus on information technology (IT) </li></ul><ul><li>Wal-Mart develop its own IT system, has strong capabilities </li></ul><ul><li>Quality of operation Normal </li></ul><ul><li>Nothing special </li></ul><ul><li>Quality of Marketing Normal </li></ul><ul><li>Word of Mouth, something to talk about: low price </li></ul><ul><li>Quality of Distribution High </li></ul><ul><li>Distribution center working very efficient together with their store expanding plan </li></ul><ul><li>Driver--More than 300,000 accident-free mile </li></ul><ul><li>Stores easy to maintain & relocated </li></ul><ul><li>Quality of Customer Service High </li></ul><ul><li>Satisfaction Guarantee </li></ul><ul><li>Aggressive hospitality -- Greeter </li></ul><ul><li>10-foot attitude </li></ul><ul><li>Pay attention to details </li></ul>Supply Chain Technology Operation Marketing Distribution Customer Service Q P = V

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<ul><li>Threat of new entry </li></ul><ul><li>economies of scale </li></ul><ul><li>strong brand identification </li></ul><ul><li>customer loyalty </li></ul><ul><li>distribution channels </li></ul><ul><li>Technology </li></ul><ul><li>Bargain power of suppliers </li></ul><ul><li>% of sales </li></ul><ul><li>good and long standing relationship </li></ul><ul><li>established suppliers standards </li></ul><ul><li>Rivalry among competing sellers </li></ul><ul><li>Threat of substitute products and service </li></ul>Five Force <ul><li>Bargain power of buyers </li></ul><ul><li>“ Every Day Low Price” </li></ul><ul><li>“ Rollback” </li></ul><ul><li>“ Special Buy” </li></ul>High High High

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SWOT Analysis Weaknesses <ul><li>Strengths </li></ul><ul><li>brand </li></ul><ul><li>substantially </li></ul><ul><li>information technology </li></ul><ul><li>Supply chain </li></ul><ul><li>Threats </li></ul><ul><li>target of competition </li></ul><ul><li>political problems </li></ul><ul><li>Intense price competition </li></ul><ul><li>Opportunities: </li></ul><ul><li>take over, merge with, or form strategic alliance </li></ul><ul><li>expanding consumer markets. </li></ul><ul><li>New locations and store types </li></ul>

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Problem Identification & Recommendation <ul><li>Global Expansion </li></ul><ul><li>Criticism regarding on employees’ wage and insufficient medical benefits </li></ul><ul><li>Public image </li></ul><ul><li>Global mindset and global awareness </li></ul><ul><li>Increase employees welfare </li></ul><ul><li>Hold more charities and ethical training </li></ul>

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