WAL-MART STORES INC.

no more news, just post one more old essay. I think I loss some essays of this case study, because I only find one sample. but this case was used in the final exam, I thought I should have at least more than one sample. I do not know where are the others?
WAL-MART STORES INC

1. Conduct a SWOT analysis
STRENGTHS


• Powerful retail brand

• Has a reputation for ‘value for money’

• Strong customer service

• Very convenience

• Offers a wide range of products

• Has grown rapidly and has expanded globally

• The use of latest supply chain technology RFID which increases the monitor and management of inventory

• Very efficient distribution strategy (lower distribution cost)

WEAKNESSES


• Due to selling different products across various divisions such as clothing, food and stationary, they may lack the flexibility the other competitors have

• Further expansion into other countries.

OPPORTUNITIES


• Merge with other global retailers like, India or other countries in Europe

• Development of the market and new locations

• Its current approach of large ‘supercentres’ is open for more opportunities
THREATS


• Because Wal-Mart is very successful (being on the top of the game) it’s the target of competition, locally and globally

• Because Wal-Mart is a global retailer, it is exposed to political problems in the country that it operates

• Lower manufacturing costs lead to strong price competition

2. What is Wal-Mart’s strategy?


Answer:

Purchasing - have more suppliers, limited their purchase, not reliant to one vendor, better inventory management.

Logistics – have the biggest trucking network (distribution centre). Stock would get to the store within a day. They took over the control of the deliver, they purchased a fleet of truck. This allows them to deliver smoothly and at their own feet. Competitors rely on trucking company, however Wal-Mart bought a truck fleet. Also more floor space would be available for selling. Satellite network enable them to communicate (internal network system).

MICS (Management Information and Control System) – using satellite network system they are able to collect data.

Store location – started off in a rural town, not much competition, cheaper to employ, products are cheaper and this attract customers, rent in cheaper (able to cut down cost at the same time minimize competition).

Marketing – branded products at low cost. They have specials (sales) advertised on media, print catalogues. This enabled them to significantly cut down on marketing expenses. Wal-Mart’s marketing strategy is to guarantee ‘everyday low prices’ as a way to pull in customers. It relied on advertised ‘sales’.

Wal-Mart operated across US. It dominated the retail market, outselling competitors by selling branded products at low cost, therefore obtaining millions of customers worldwide. Another strategy is it expanded internationally, gaining dominance and power.


Shoplifting became a significant issue that Wal-Mart encouraged managers to be accountable and gave its associates (employees) incentive to be creative. The ‘people greeter’ technique (employee welcomes shoppers as they entered the store) does not only provide personal service but their presence served to reduce pilferage.

Also, Wal-Mart respect and treat its employees well and push them to excel in what they do. Wal-Mart instituted several other policies and programs for its employees such as incentive bonuses, a discount stock purchase plan, promotion from within, pay raises based on performance and an open-door policy.

3. What is the basis on which Wal-Mart builds its competitive advantage?
Answer:

Wal-Mart builds its competitive advantage on the basis of Low-Cost. It advertises its products as low prices and offers high customer service.


4. How do Wal-Mart’s control system help execute the firm’s strategy?
Answer:

The management and the company have the same goal. They all want to serve the customer properly. Wal-Mart’s control system help execute the firm’s strategy by having a high level of goal congruence between the management and the company.

5. ‘RFID’ – what is it?

Answer:

RFID or Radio Frequency Identification is the latest supply chain technologies which increases the monitoring and the management of the inventory.

6. What does it mean to Wal-Mart to have a ‘saturation strategy’?

Answer:

To have a ‘saturation strategy’ means to crush or eliminate competition. Wal-Mart’s strategy has the intention of eliminating its focused competitors.

7. Check out Wal-Mart’s website. Any other information that is relevant to strategy?

Answer:

Wal-Mart offers big opportunities to small suppliers.

Examples are: Bob McDuff developed a McWiz, a trivia game and became instantly popular with the kids. Wal-Mart gave Canadian businesses an opportunity to meet buyers from Wal-Mart.

8. Any stores similar to-Wal Mart in Australia?

Answer:

Bunnings, Kmart and BigW stores in Australia are similar to Wal-Mart. They also sell branded products at low cost.

and i just find one more about DELL

1. Conduct a SWOT analysis


Strength: Dell has a new way to sell their products. It eliminated retailers and shipped directly from its factories to end customers. It took customized orders for hardware and software over the phone or via the Internet. Using this method, Dell understands customer’s need well.

Weakness: In the aspects of COGS and Inventory turnover, Dell is higher than IBM.

Opportunities: Globalization- Dell can sell its computers to the other countries by competitive price. Also, globalization can help Dell to decrease its cost, because Dell can make its products in some low-labour-cost countries, like China and Vietnam.


Threats: From the exhibit 1, we can see that in some items Dell is less than IBM and HP, like Sales, Gross margin, Operating income and Net income. IBM and HP are the powerful competitors of Dell. And there are more and more computer companies in the world.


2. What is Dell’s strategy?

Direct selling, from manufacturer to consumer, was a key component of its strategy.

3. What is the basis on which Dell builds its competitive advantage?

The company based on a simple concept: that the Dell could best understand consumer needs and efficiently provide the most effective computing solutions to meet those needs by selling computer systems directly to customers. Using the way to save time and money and also allowed the company to build every system to order, offering customers powerful, and richly configured systems at competitive prices.

4. The case study discusses the traditional value chain: the indirect model and Dell’s value chain: the direct model. Construct both value chains.

The traditional value chain in this industry was characterized as “build-to-stock”. Firstly, the manufacturers designed and built the products with preconfigured option based on market forecasts. Then products would be stored at the warehouse and later distributed to retailers who will add up 20-30% markup.

Dell’s value chain is direct model which took customized orders first and then fulfilled the orders by buying and assembling the needed components. Dell eliminated retailers and shipped the products directly from the factories to end customers.


5. In general, what is the purpose of value chains? Why are they an effective tool in company management strategies?

Value chain can help to identify the cost driver of each activity, assign the cost and revenues, etc. in companies. Identifying a value chain can help managers make decisions efficiently such as how to reduce the cost of good sold and distribute the administration fees properly, even help to find the competitive advantage for business.

6. Have you heard of the term ‘lean manufacturing’? Find out and discuss how it complements value chain analysis.

Lean manufacturing is the production of goods using less of everything compared to traditional mass production, which would use less waste, human effort, manufacturing space, investment in tools, inventory, and engineering time to develop a new product. That will complement the value chain to get maximize value to the manufacturers.

7. Is Dell Computers ‘lean’? Discuss.

From the case, we can tell that Dell is using lean manufacturing systems. Above all, Dell takes the orders from customers first. Manufactured the product is the second step, this could adequately meet each individual customer’s need and this make quick inventory turning over too. It eliminated retailer which reduce cost and save the time for delivery. All in all Dell is very responsive to customer requirements.

8. ‘The primary financial objective that guided managerial evaluation at Dell was return on invested capital (ROIC). Thomas J. Meredith, former Dell CFO, even put ROIC on his number plate.’ Pg 317. Explain and discuss ROIC and why it was so important to Dell.

ROIC means Return on Invested Capital, which is a measure of how effectively a company uses the money invested in its operations. Dell could use it to assess a company's potential to be a quality investment by determining how well a company's management is able to allocate capital into its operations. Michael Dell also emphasised information is their most important tool. High ROIC level is a powerful proof of a solid company management.

9. Check out Dell’s website. Any other information that is relevant to strategy?

From the website, we can see their Advertising strategy- Devise an IT strategy to support the fast growth of GSD&M Advertising, as well as keep up with the fast-paced nature of the advertising business; provide an IT infrastructure that enables the agency to be more creative than the competition. (http://www1.ap.dell.com/content/topics/global.aspx/casestudies/en/ap/fy2008_q2_id450?c=au&cs=aubsd1&l=en&s=bsd)

Hey, good news, I just find another Wal Mart one

1. Conduct a SWOT analysis


Strength: Wal-mart has the most powerful supply chain and logistics. Wal-mart also has the largest privately owned satellite communication network in U.S. and broadcasted more television than any network TV.

Weakness: Shoplifting and pilferage is one of the weaknesses. The other one is Wal-mart is too large, so it’s hard to control and management.

Opportunities: Already being the leader supermarket in US, and obtain 38% share in the Japanese retail chain Seiyu. This will help Wal-mart to exploite international market.

Threats: Being number one means that you are the target of competition, locally and globally. From the chart 1999-2004, we can tell the company Home Depot is at very subtle inferior position behind Wal-Mart at the aspect of “return on equity”. Whereas, the figure of “sales growth” ”operating income growth” Home Depot got a preponderance. Though the total sales volume of Home Depot can not to be named on the same day with Wal-Mart, simply looking at the growth ration, Home Depot is the biggest competitor of Wal-Mart.

2. What is Wal Mart’s strategy?

Discussion can focus around:

purchasing

logistics

store operations e.g. location, HRM, MICS, shoplifting

marketing

Purchasing: Wal-mart deliberately ensured it did not too dependant on any one supplier, no single vendor constituted more than 4 percent of its overall purchase volume. Wal-Mart also persuaded the suppliers to use electronic technologies to drive up the supply chain efficiency.

Logistics: The owned a number of trailer trucks and truck drivers. Also has implemented a satellite network system that allowed information to be shared between the company’s wide network of stores, distribution centers, and suppliers.

Location: Wal-mart’s strategy was bo build large discount stores in small rural owns.

Marketing: Wal-mart’s marketing strategy was to guarantee “everyday low prices” as a way to pull in customers.

3. What is the basis on which Wal-Mart builds its competitive advantage?

Wal-mart’s winning strategy in the U.S. was based on selling branded products at low cost.


4. How do Wal-Mart’s control systems help execute the firm’s strategy?

Each store constituted an investment center and was evaluated on its profits relative to its inventory investments. And then data from each store would be collected and analyzed, revealing the performing of the stores. Finally, the data from “outstanding” performers among 5,300 stores were used to improve operations in “problem” stores.

5. ‘RFID’ – what is it?

“RFID” stands for “Radio Frequency Identification”. It could increase monitoring and management of inventory.

6. What does it mean to Wal-Mart to have a ‘saturation strategy’?

“Saturation Strategy” is used for store expansion. The standard was to be able to drive from a distribution center to a store within a day. Wal-Mart’s distribution system was so efficient that they incurred only 1.3% of sales as distribution costs compared to 3.5% for their nearest competitor.

7. Check out Wal-Mart’s website. Any other information that is relevant to strategy?

From the website, we can find something about Wal-mart’s international strategy. Wal-Mart’s 3000th international store is scheduled to open on November 22 in Sao Paulo, Brazil. Check the details on http://www.walmartfacts.com/articles/5500.aspx.

8. Any stores similar to Wal-Mart in Australia?

Coles, Kmart and so on