First Wal*Mart store started on 1962

Market Value of $57.5 Billion on 1993

INTRODUCTION
Wal*Mart revolutionized many aspects of retailing
and heavily invested in information technology

In 1994 Wal*Mart was operating 1953 outlets

WHAT ARE THE SOURCES OF WAL-MART’S COMPETITIVE ADVANTAGE IN DISCOUNT
RETAILING?

Walton believed in value for Walmart was competitive in

Walton believed discounting Offered “satisfaction
money and kept prices below pricing and gave freedom to
worked in small towns so guaranteed “ policy to return
everybody else with store managers to set price
located stores in areas not merchandise at any Walmart
promotional strategy of according to local market
served by any competitors. store.
“everyday-low-prices”. conditions.

Technological advantage of Installation of satellite system

Some Stores operated 24 Walmart’s two step hub and
having electronic scanners to allowed easy understanding of
hours, primarily self service and spoke distribution network via
read Uniform Product Codes ,2 sales data and merchandise
on cash and carry basis. Cards satellite ensured lower cost of
years ahead of competitors, movement thus reducing
were also accepted for easy inbound logistics than its direct
ensured improved efficiency overstocking and deep
shopping experience. competitors.
and accurate pricing. discounting.
 HOW SUSTAINABLE THEIR POSITION IN DISCOUNT RETAILING WILL BE IN THE
FUTURE?

Expansion in International market- Potential International Sales expected Defended the accusation of wrong
to be $100 billion. pricing by claiming that it maintained
and followed Sam Walton’s policies.
In 1992,Joint venture with Mexico Largest retailer to test
several retail formats with 63 operating stores,much
more than its competitors.
In 1994,expansion in Canada,bought 122 Woolco stores
and remerchandising and renovating them,result in $900
million sales.
1995,planned to enter South America,continent’s largest
consumer market and China having highly regulated
market.
HOW EFFECTIVE THEIR DIVERSIFICATION INTO THE FOOD INDUSTRY WILL BE?

Located first supercenters in small towns i.e targeting existing customer base of discount
stores, thus taking benefit of familiarity and low price image. This also helped them because
they had the first mover advantage.

Purchased McLane Company in 1990 ,a Texas retail grocery supplier that can supply up to 80-
90 supercenters thus ensuring convenient distribution to all its supercenters.

With the diversification and product such as cola, tortilla chips Wal*Mart offer price
competitive advantage being 9%-60% with an added advantage of creating 41K jobs.
THANK YOU