PLANNING STRATEGY OF WALMART

Made by-
KUMAR ASHUTOSH
MRIDU AGGARWAL
KAJOL MANDARWAL
AYUSH GUPTA
MAYANK SINGH NAPALCHYAL
YASHTSHITIJ GURUNG
ARSHITA OHRI
 Introduction to Walmart

The company was founded by Sam Walton in 1962 and incorporated on October 31,
1969. It also owns and operates Sam's Club retail warehouses. As of October 31,
2019, Walmart has 11,438 stores and clubs in 27 countries, operating under 55 different
names.
Walmart is the world's largest company by revenue, with US$514.405 billion, according
to the Fortune Global 500 list in 2019. It is also the largest private employer in the world
with 2.2 million employees. It is a publicly traded family-owned business, as the company
is controlled by the Walton family.

History of Walmart
An American discount department store chain, began in 1950 when businessman Sam
Walton purchased a store from Luther E. Harrison in Bentonville, Arkansas, and opened
Walton's 5 & 10. ... The company introduced its warehouse club chain Sam's Club in 1983
and its first Supercenter stores in 1988.
Sam Walton made the decision to achieve higher sales volumes by keeping sales prices
lower than his competitors by reducing his profit margin. Inspired by the successes of
other discount department store chains, Walton opened the second store in Harrison,
Arkansas, that year. Responsible for the purchase and maintenance of signage, Walton's
assistant, Bob Bogle, came up with the name "Wal-Mart" for the new chain.
In 1981, Wal-Mart expanded into the southeastern US market, opening stores
in Georgia and South Carolina, and acquiring 92 Kuhn's Big K stores. They expanded
into Florida and Nebraska in 1982.
Company’s objectives
Initiatives to drive traffic and comp sales
Building the next generation of retail

PROJECT PLANNING
Walmart’s team focuses on the following aspects for driving traffic and comp sales.
Aggressive mass merchandising
Improving traffic and sales in key categories
Going deeper on price Winning the holiday season
Aggressively sharing our message

Aggressive mass merchandising

Let’s consider the first two points, in the 1st point it says aggressive mass merchandising.
This implies that to improve the traffic and increase the company sales, Walmart believe
in aggressive mass merchandising. Walmart seek to sell large quantities of goods quickly
through such means as discounting, customer self-service, or unadorned display and
packaging, as in a warehouse.
This has been an old strategy for Walmart and continuing this they have increased the
number of stores around the world.

Improving traffic and sales in key categories

Walmart continue strong performance in apparel, home, fresh and wireless items and,
they are addressing opportunities in dry grocery, snacks&bev, consumables and
entertainment.
Walmart has performed very well in neighborhood markets along with Walmart express.
Walmart has addressed improvements in discount stores and they apply schemes on their
10% stores which are at the bottom.
 SWOT ANALYSIS OF WALMART

Strengths

1. Brand recognition – With millions of customers visiting Walmart every day, it is the
most recognized retail brand in the world. There are over 60 million items available at the
Walmart online store.
2. Global expansion – Walmart has recently purchased ASDA, the UK based retailer and
Indian e-commerce giant Flipkart. Besides, it has created a joint venture with India’s
biggest retail store Bharti. These global expansions have proven to be a great success for
the company.
3. Global presence – In 2017, Walmart opened 47 new stores in Central America, 15 in
Chile, 11 in the UK and 4 in China. Its international operations have increased its sales
and global presence.
4. ‘Every Day Low Prices’ strategy – Walmart is based on economies of scale agenda
that’s why it can offer low prices. It has fixed costs for thousands of products. Thus, it’s
one of the cheapest shopping places in the world.

Weakness

1. Employee treatment and working conditions – Walmart has received criticisms and
lawsuits several times regarding its workforce. Low wages, inadequate healthcare, and
poor working conditions are few of the issues that have been publicly criticized.
2. Large span of control – Its highly extended size and massive span of control could
leave Walmart weak in some areas.
3. Thin profit margins – Walmart focuses on a cost leadership strategy. It results in thin
profit margins for the company.
4. Imitation – Walmart’s business model can be easily copied. The company doesn’t own
any specific competitive edge over its rivals except its huge business size.

Opportunities
1. Expansion to other markets – Walmart can gain the opportunity by expanding its
business to the markets which are not yet ventured. These may include China, Middle
East countries, and Latin America.
2. Strategic alliances – Walmart can create strategic partnerships with major firms or
merge with other global retailers. Acquisitions of small companies can also be a profitable
opportunity for Walmart.
3. Enhancing human resource practices – Bringing advanced improvements in human
resource practices can be a favorable opportunity for Walmart. As it highly relies upon
its workforce, bringing innovation in its human resource management is a crucial
opportunity.
4. Improving quality standards – Low-cost products render low quality sometimes.
Walmart has the opportunity to enhance the quality standards of its products to address
the health concerns of consumers

Threats

1. A primary target of competition – The world’s largest grocery retailer, Walmart is

always a primary target for competitors. Target, its direct competitor, offers similar
products but with higher quality. Similarly, Costco offers customers to buy items in bulk.
Additionally, these companies have a relatively good reputation for treating their
employees well compared to Walmart. Both companies are also publicly supported in
these areas.
2. Political and legal Issues – This is also a threat to Political and legal affairs can always
hinder the company to operate in some countries.
3. Small-scale online e-commerce companies – Many small-scale and individual online
selling companies have entered the market offering similar products at similar prices on
their websites. It can be a threat to the company’s future standing.
4. Technical issues on the website – Customers have complained many times that there
are some technical issues with Walmart’s website. The products are not listed in an
organized way on the website, and it runs slowly. However, Amazon is known for its fast,
effective, and organized website, making an excellent online shopping experience for
customers.
TARGETED PLANS FOR UNDERPERFORMING STORES
OF WALMART ARE
Present targets of Walmart companies are Midwest, Memphis, and New York. In India
also Walmart has targeted Amazon, Flipkart, and Myntra. Walmart India owns and operate
25 best price modern wholesale stores. Local target stores could be one of the locations
closing by February 2019. Sad news for some target diehards in the Midwest, Memphis
etc. the company announced this week that six retail locations in those areas would be
closing in the beginning of the New Year. Overall the shopping experience at target was
significantly better than at Walmart and it still offer a lot of deals despite being more
expensive than Walmart. Lend Edu found that on average items at target were 1.16% more
expensive than Amazon’s on average, Rachael Ray 12- Piece Aluminum Cookware set.

FUELING THE PRODUCTIVITY LOOP

Walmart take cost out of our business and pass the saving along to customers. We call it
the productivity loop. By operating for less we can lower our prices. Having low prices
drives traffic to our store and increasing sales. Walmart business strategy and competitive
advantage. Walmart business strategy is based on everyday low prices philosophy of the
company in other words, Walmart pursues cost leadership business strategy enable by the
economies of scale derived by the company in a significant extent.
Utilization of resources

Single Focus to Keep Prices Low

Throughout its 50+ years of history, Walmart has stayed true to its purpose and
consistently striven to offer low everyday prices to its customers, and because of this,
Walmart has built for itself a strong and loyal customer base. Customers walking into any
Walmart store know that they can count on low prices. In order to keep prices low for the
customers, there are a number of things that Walmart did that helped them achieve that
goal.

Minimizing Operating Costs

Walmart is notoriously stingy when it comes to its treatment of its employees. Walmart
has been known to push wages down as far as legally possible. It offers low-benefit
healthcare plans to its employees and its executives do not enjoy the many perks typically
offered to high-ranking executives at other large corporations. These are ways for
Walmart to minimize operation costs and keep its overhead costs low.

Walmart Revenue from 2012 to 2017 in Billion $.

Advanced Supply Chain Management

Walmart is widely regarded as an industry leader in supply chain management. Aside
from leveraging the most up-to-date technological advances such as the barcode and
RFID, Walmart has pioneered a number of approaches that help it remain competitive in
the price war against its peers.
Walmart pioneered cross-docking in its supply chain strategy. Cross-docking refers to the
practice of moving products from a supplier or manufacturer directly to the customer or
the retail chain, with very little handling or storage. This practice greatly reduces
transportation costs, storage costs, and labor costs.
Ecosystem would enhance financial priorities

Growth – Growth in sales, growth in the number of customers, growth through new stores
and acquisitions, growth in new markets.
Leverage – company’s goal is to grow sales faster than operating expenses. company are
leveraging innovation, systems and processes to improve our overall productivity.
company have committed to reducing operating expenses as a percentage of sales.
Returns – company goal is to provide a stable level of returns to shareholders. Last year,
Walmart returned $13 billion to shareholders through dividends and share repurchases.

Walmart vision for market ecosystem

Respect the Individual

Every customer and employee deserve to be treated with respect and dignity.
Service to Our Customers
Offer the lowest prices with the best possible service.
Strive for Excellence
Find new and innovative ways to constantly improve.
 Conclusion

The aim of planning strategy is to strengthen a particular business so that its performance
increases and, in turn, the business becomes more profitable. Without a planning strategy,
a business has no guide to follow and has an increased risk of not succeeding.
Sam Walton- founder of walmart, whose business style is that customer and product
quality is paramount has an extremely effective business strategy for walmart. It has now
become classic example of art of successful business plan.
Thank you