Strategic Analysis of Walmart: SWOT, External and Industry Analysis

This report provides a strategic analysis of Walmart, including SWOT, external and industry analysis. It evaluates the internal and external environment of Walmart and provides recommendations to the company accordingly in order to consolidate its position in the global retail industry.

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Running head: STRATEGIC MANAGEMENT

STRATEGIC MANAGEMENT
Contents
Introduction......................................................................................................................................2
BACKGROUND.............................................................................................................................2
Vision Statement..............................................................................................................................2
Mission Statement...........................................................................................................................3
History/Timeline..............................................................................................................................4
Industry............................................................................................................................................5
Company Overview.........................................................................................................................6
Strategic Analysis............................................................................................................................6
External Environment: General Environment.............................................................................7
External Environment: Industry Analysis...................................................................................8
External Environment Strategic Group (Major Competitors)...................................................10
Internal Environment: Financial Analysis.....................................................................................13
Internal Environment: RBV and Balanced Scorecard...............................................................18
Problem Statement.....................................................................................................................22
Recommendation/ Implementation............................................................................................23
Conclusion.....................................................................................................................................24
References......................................................................................................................................25
Appendix........................................................................................................................................26
APPENDIX A: SWOT MATRIX................................................................................................26
APPENDIX B: GRAND STRATEGY MATRIX (David, 2005)............................................30
Appendix C....................................................................................................................................31
Appendix D....................................................................................................................................33
Appendix E....................................................................................................................................35
References......................................................................................................................................37
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Introduction
The main purpose of current report is to evaluate the internal and external environment of
Walmart and provide recommendations to the company accordingly in order to consolidate its
position in the global retail industry. The paper begins by providing an overview of the company
and the business level strategy of the company. After providing an overview of the company, the
paper focuses on strategic analysis of the company by conducting analysis of the internal and
external landscape. After strategic analysis the paper identifies various problems which have
been identified during the course of strategic analysis of the company and accordingly provides
recommendations to the company.
BACKGROUND
Vision Statement
Walmart’s vision statement is to “Be THE destination for customers to save money, no matter
how they want to shop.” Walmart aims to become the best retailer and touch not only mind but
even hearts of their customers and employees. Their vision statement contemplates strategic
changes that are implemented by Walmart in reaction to modification in competing landscape
and conditions in industry. Also, it not only reflects Walmart’s aspiration to become the top most
retailers in the industry but also presents greater emphasis on business flexibility so as to
accommodate preferences of their customers. For instance, the element of Walmart’s vision such
as offering flexibility to customers irrespective of the way they shop indicates Walmart’s
strategic purpose for attaining leadership in traditional brick and mortar transaction and in online
retailing. The flexibility of the vision statement of Walmart also reflects support for their
employees and consideration for their issues as employees are vital stakeholder groups that are
significant to Walmart’s CSR approach and stakeholder administration.
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Mission Statement
Walmart’s mission statement is “to save people money so they can live better.” This indicates
values of Walmart’s founder Sam Walton. Also imperative resolutions are unambiguous
indications of the Walmart’s mission that corresponds with their slogan “Save money. Live
better”. Thus it is evident that Walmart’s corporate approaches include utilizing prices as selling
point to appeal their segmented audiences and its relevance is indicated in their various corporate
strategies, like for instance, Walmart’s marketing mix or 4P’s includes affordable pricing as their
strategy. Other aspect of Walmart is evident by requisite to lower selling prices as technique to
attain competitiveness. Further, Walmart meets the “save people money” element of their
mission by their affordable selling prices. For instance, customers save money through
unsubstantial spending in buying products from Walmart’s outlets in contrast to purchasing same
merchandise from other outlets. Nonetheless, it is still not evident whether Walmart fulfills the
“live better” element of their mission statement as there are criticisms related to lower wages that
create concerns for Walmart’s staffs related to better living along with HRM concerns that are
encountered in Walmart. There are even critique on long term economic impacts of Walmart’s
extensive selling of cheaper imported merchandise.
David (2005) presented nine components of an efficacious mission statement that includes
customers, product/ services, markets, technology, concern for survival, philosophy, self-
concept, concern for public image and concern for employees. These are as follows:
1. Customers- who are customers of firm?
2. Product/service- what are primary products or service of firm?
3. Markets- Where does firm compete geographically?
4. Technology- Is the technology of firm basic?
5. Concern for survival, growth and profitability- Is the firm committed to growth and financial
development?
6. Philosophy- What are the beliefs, values, aspiration and ethical priorities of the firm?
7. Self-Concept- what is the firm’s unique competence or main competitive edge?
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8. Concern for public image- Is the firm responsible to social, community and environmental
concerns?
9. Concern for employees- Are employees a valuable asset for firm?
After evaluation of Walmart’s mission statement as per nine components of Fred R David it is
evident that Walmart’s defines 3 components i.e. Customers, philosophy, concern for public
image specifically in their mission statement.
Component 1 2 3 4 5 6 7 8 9
Company
Fig: Fred R. David’s Nine Components of Mission statement
Source: Author
History/Timeline
1962: Sam Walton opened 1st Walmart store in Rogers, Arkansas
1967: Walton family owned 24 outlets and generated up to 12.7 m USD in sales
1969: Officially incorporated as Walmart Stores Inc
1970: Walmart became public trading firm and 1st stock was sold at 16.50 USD/share
1971: Opened 1st distribution centre and home office in Bentonville, Arkansas
1972: Walmart was listed in NYSE. It had 51 stores with record sales of 78m USD
1975: Sam Walton motivated by his Korea visit introduced Walmart cheer
1979: Walmart Foundation was formed
1980: Walton family founded Walton Family Foundation. Walmart reached 1 bn USD annual
sales faster than any other firm during that period, had 276 outlets and employed 21,000 staffs
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1983: 1st Sam’s club was opened in Midwest City, Oklahoma. Walmart replaced cash registers
with computerized POS to ensure faster and hassle free checkout
1987: Walmart installed biggest private satellite communication system within USA and linked
operations with voice, data and video communication
1988: 1st Walmart supercenter was opened in Washington, Missouri that combined general items
and full scale supermarket under one stop shopping store
1991: Walmart expanded global region by venturing jointly with Cifra and opened Sam’s Club in
Mexico
1992: Sam Walton articulated mission of saving people money so they can live better
1994: Walmart expanded to Canada with purchase of 122 Woolco outlets
1996: Walmart opened 1st store in China
1998: Neighborhood market format was introduced in Arkansas and Walmart entered UK with
acquisition of Asda
2000: Walmart.com was established
Industry
Walmart is an American firm that operates in retail industry and has primary divisions i.e.
hypermarkets, discount department stores and grocery outlets. Hypermarkets are combination of
supermarket and department stores and hence are expansive retail unit that has variety of
products under one roof such as grocery, general merchandise and other products. Whereas
discount department stores or shops are retail units that sell products at prices lower than market
prices and may offer wide range of assorted items with focus on price instead of service, display
or wide product lines. While a grocery store is retail unit that offers mainly food items or
nonperishable packaged food, bakery, meat etc. Also these may offer household items including
pharmacy. In 2017, Walmart had 26% market share in US in offline and online market with 800
bn USD share in industry. Walmart reported revenue growth rate of 1.25% Y/Y in 3rd Quarter of
2019 to 124,894 mn USD which is lesser than their average revenue growth rate of 5.73%. Their
total revenue in 2019 is 514.415 bn USD.
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Company Overview
Walmart Inc. is a transnational retail company headquartered in Bentonville, Arkansas which
functions chain of hypermarkets, discount department stores and grocery stores and was founded
by Sam Walton in 1962; incorporated in 1969. The company specializes in offering multiple
products and offerings to customers at unbelievably lower prices from both retail stores and
online platforms.
As stated by Hunt, Watts & Bryant (2018) generic competitive strategy which is being followed
at Walmart is cost leadership strategy which focuses on providing products to customers at
lowest possible price by minimizing costs.
The main intensive growth strategy which is followed is market penetration strategy which
involves selling more products to customers in current market in which Walmart operates in
order to grow business.
The competitors of Walmart are Kmart, Costco, Amazon, ALDI and LIDL.
Strategic Analysis
SWOT Chart
Strengths
1. Marketing strategies being adopted by
Walmart.
2. Large economies of scale
3. Strong growth management strategies
4. Strong corporate culture, distribution,
information technology and inventory control
system adopted by Walmart
Weaknesses
1. Management of HR issues.
2. Lack of efficiency in online model
3. High rate of employee turnover
4. Lack of international marketing research
5. Lack of manufacturing facilities.
Opportunities Threats
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1. Obtaining membership in World Trade
organization.
2. Increase in trend of shopping at superstores.
3. Intense competition in pricing
4. Demographics are open to new markets and
products
1. International Expansion barriers
2. Slow global economic growth
3. New retail formats
4. Strong competition in local markets
5. Cultural expansion and marketing issues
External Environment: General Environment
Demographic- The demographic factor impacts operations of Walmart as these determine
strategy adopted in various countries. There are various trends which reflect segmentation of
Walmart’s market such as population size of country in which they operate, income distribution
of customers and ethnic mix of the country in which they operate (Hitt, Ireland & Hoskisson
2007)
Socio-cultural- The socio-cultural factor impacts operations and strategies adopted by Walmart
in which they operate so as to comply with preferences and demands of customers. There are
various trends which reflect Walmart’s socio-cultural aspects such as lifestyle of customers in
the countries in which they operate cultural values of customers and their educational level.
Political-legal- The political and legal factor impacts operations of Walmart as they need to
comply with political and legal activities which are imposed by government of the countries in
which they operate. There are various trends which reflect political legal aspects of Walmart
such as labor policies of the countries in which Walmart is based, taxation policies and initiatives
taken by government of the countries in which they operate.
Economic- The economic status of the country in which Walmart operates impacts their
operations as pricing strategy of their products are dependent on economic conditions. There are
various trends which reflect Walmart’s economic aspects such as purchasing power of customers
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in different countries in which they operate, disposable income of customers and rate of
unemployment in the country in which they operate.
Technological- The technological advancements of the country in which Walmart operates
impacts their various functions such as marketing, operations, human resources and R&D. There
are various trends which reflect this aspect such as rate of technological advancement in the
country in which Walmart operates rate of technology diffusion and availability of technological
infrastructure.
Global- The global business scenario also impacts international operations of Walmart as they
operate in multiple companies. There are various trends which reflect this aspect such as relation
between different countries in which Walmart operates agreement between various existing trade
blocks and global terrorism.
External Environment: Industry Analysis
Threat of new entrants- threat of new entrants is comparatively lower in global retail because of
strong position of few retailers who are present in global retail industry on basis of quality, price
and product range. There are also various barriers of entry due to factors such as requirement of
high investment, requirement of a reputed and established brand name and requirement of
outstanding distribution network. It is important for Walmart to increase its revenues by
appealing more customers towards their products through effective marketing approaches so as
to endure competitive place in global retail industry (Dess & Lumpkin 2003) It is hard for new
entrant in retail industry to gain market share as they first they need to gain acceptance among
customers by building their brand reputation and by increasing their distribution network which
requires huge amount of investment and therefore it is nearly impossible for new entrants to
make such big investments which reduces their threat.
Bargaining power of suppliers- bargaining power of suppliers is moderate in global retail as large
suppliers enjoy high bargaining power in market whereas small suppliers have low bargaining
power. As stated by Vila, Bharadwaj & Bahadir (2015) large market share of Walmart in global
retail industry provides opportunities to both producers and suppliers which enlarges power of
Walmart over its suppliers and withholds competitive place in market. Walmart has also vertical
integration with their vendors which minimize bargaining power of suppliers and in turn enlarges
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efficaciousness of Walmart to provide ideal product to ideal customer in ideal time. Another
factor which results in lower bargaining power of small suppliers is availability of number of
suppliers in market who remain always eager to work with big retailers and therefore existing
retailers do not impose high bargaining power to consolidate their position in market.
Bargaining power of buyers- bargaining power of buyers is lower in retail market currently, but
with increasing level of competition in retail industry, bargaining power of customers is
gradually increasing as they now have luxury to choose between multiple retail options, which is
forcing Walmart to keep prices of their products low all the time (Porter 1980) The bargaining
power of customers in global retail sector is also considered to be low as nearly all the retailers
offer their products at minimal possible price which provides limited scope of bargaining to
customers. As opined by Dow Jones Institutional News (2015) at same time, switching costs for
customers in current global retail market is also negligible in nature and hence customers can
easily switch from one brand to other in search of better products or deal as a result of increased
competition. Therefore gradually increasing bargaining power of customers and low switching
cost is affecting market position of Walmart and therefore it should focus on enhancing customer
satisfaction.
Threat of substitutes- threat of substitutes is comparatively moderate for Walmart in US retail
industry because of absence of retail outlets which offers comfort and lower priced products to
consumers. As stated by Baba (2015) one of the main factors which reduce threat of substitutes
is wide variety of products offered by Walmart and hence they have advantage to be more
competitive in nature because of quality of products and pricing aspects. On other hand main
factor which increases threat of substitutes for Walmart is growing demand and popularity of
online retailers who also provide wide range of products to customers at lower and competitive
prices and due to existing trend in market regarding online shopping Walmart should focus on
paying equal attention to both physical and online retail stores so as to reduce threat of
substitutes and maintain competitiveness in market.
Industry rivalry- The retail industry is very competitive in nature due to presence of large
number of players which includes K Mart, Costco, Tesco, Amazon, Metro AG etc. which
competes with Walmart on basis of cost leadership. These competitors affect position of
Walmart in retail industry as a result of increase in their position due to their business extension
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and also due to enlargement in customer base. The rising competition in retail is influencing
operations of major players and therefore affects their revenues, which can also change strategic
direction of Walmart.
From above analysis it can be stated that retail industry is very attractive industry with higher
potential for growth despite increasing level of competition. Also it can be stated that retail
industry is characterized by presence of big retailers who hold majority of market share. On the
basis of analysis, recommendation to existing firms is to focus on providing customized
shopping experiences to shoppers in order to attract them to stores and products as they cannot
be influenced by cost leadership strategies only as it is followed by nearly all retailers belonging
to industry. It can be recommended to new firms that they focus on differentiating products from
those of competitors as it will help in attracting customers towards products and it is the only
way by which they can compete with larger players in industry.
External Environment Strategic Group (Major Competitors)
Major Competitor 1- Costco Wholesale Corporation is chain of membership-only warehouses
which offers limited collection of regionally branded and private label products. Costco provides
lucrative value deals to loyal customers which allow them to have huge membership renewals.
They also have business operations spread across US, Canada and 8 other countries. The generic
strategy which is followed is cost leadership which enables them to charge lowest possible prices
for products. The main objective of Costco is to consistently offer their members with best
merchandise at lowest prices.
The strengths of Costco are:
Price positioning helps in earning customer loyalty- The strategy which is being adapted by
Costco to gain market share is strategy of being cost leader which has been supported by 15 %
mark-up of Costco which is comparatively much lower than industry average. This strategy gives
attractive value proposition to customers and in turn helps in incentivizing greater footfalls
which helps in increasing market share and customer loyalty.
Low cost Operations- Costco maintains fourfold strategy to build sustainable and
environmentally responsible business. This helps in lowering carbon footprint, improving
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warehouse energy management system, development of waste stream management systems and
packaging design initiatives.
The weaknesses of Costco are:
Offers limited product choices- as compared to other retailer in USA; Costco stocks lesser
products which is a weakness. On average Costco stocks nearly 4000 products while retail stores
such as Walmart stocks around 50000 products and therefore limited offer of product serves as
competitive demerit for Costco in US.
Geographic dependence- The US and Canada market add to more than 80% of their total revenue
which can be considered threatening in context of entry of new companies or during economic
recession.
Product recall - The recall of the products affects reputation of Costco in market which can be
termed as major weakness. For instance Costco was forced to recall its rotisserie chicken salad in
US as a result of outbreak strain in E. coli toxin which impacted sales and harmed reputation.
Major competitor 2- Kmart is an American big box department store chain which was formed
during 1899 and is based in Illinois, United States. Kmart is subsidiary of Sears Holding
Corporation and focuses on making great shopping experience for customers by providing good
quality products and remarkable shopping. Kmart provides various brands which include Adam
Levine, Jaclyn Smith, Route 66, Joe Boxer and Smart Sense. Other than aforementioned deals
and offerings, Kmart also provides various financial services which include leasing options.
Kmart pharmacy provides best in class patient care for customers and acquires top spot in
context of customer satisfaction. Being leading US discount retailer, Kmart sells private label
goods which are mainly targeted towards low and middle income family group. Kmart carries
out business operations from close to 1200 off-mall stores out of which 20 are supercentres by
nature. The objectives of Kmart are creating enduring relations with customers, achieving more
productiveness and efficaciousness, developing brands, re-inventing consistently with
technology and innovation and live values of Kmart everyday while operating in market.
The strengths of Kmart are:
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Excellent product lines- Kmart deals with great product lines such as Adam Levine, Jaclyn
Smith, Route 66, Joe Boxer and Smart Sense which can be considered as strength that helps to
gain visibility and increase brand value.
Store location- stores of Kmart are mostly situated in urban areas which houses intense
population and it can be considered as strength as it helps in increasing sales of products.
Layaway plans- Kmart has effective layaway plans in place for customers who prefer to pay their
bill in instalments which helps in customer retention, which can be considered as major strength.
Excellent customer service- Kmart has excellent reputation among customers regarding customer
service which helps in effectively meeting demands and expectations of their customers.
High brand loyalty- As opined by Harrison, Paul & Burnard (2016) brand loyalty of Kmart is
comparatively more among smaller customer base which has helped them to gain high level of
visibility.
Excellent brand equity- As Kmart is present in retail sector for large period of time; it has gained
high brand equity.
Good quality products- Kmart provides good quality products to customers which has helped in
increasing their brand image.
Awards and recognitions- Kmart has received large number of awards and recognition which has
helped in increasing their brand value.
The weaknesses of Kmart are:
Financial condition- Kmart has encountered steep fall over the years which has insisted them to
apply for bankruptcy and it can be considered as one of the greatest weaknesses as it leads to loss
of customers which affects their revenue.
Ineffective supply chain- Kmart has ineffective supply chain management practices in place
which can be considered as one of the major weakness regarding competing with other top
retailers in market.
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Closure of stores- The closure of Kmart for some time has affected their brand image which led
to huge downfall.
Poor marketing strategy- The marketing strategy of Kmart has been poorly designed and is
ineffective in nature as it has not made use of various avenues to reach their target markets
effectively.
Low price in suburban stores- In suburban stores, Kmart has placed lower profit margins on its
products which affects their revenue.
Internal Environment: Financial Analysis
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Fig: Current Ratio of Walmart 2014-2019
Source: macrotrends.net (2019)
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Fig: Quick ratio of Walmart between 2014-2019
Source: macrotrends.net (2019)
Fig: Walmart Inventory turnover between 2013-2019
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Source: macroaxis.com (2019)
Fig: Walmart Debt management ratios 2014-2019
Source: macrotrends.net (2019)
Calculated ratios:
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The ratios indicate positive liquidity ratio, positive asset utilization ratio, debt management ratio,
profitability ratio and market ratio of Walmart as compared to their competitors.
Internal Environment: RBV and Balanced Scorecard
Tangible
Valuab
le
Rar
e
Inimitabl
e Organized Competitive Expected
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Resources Advantage Performance
A
Stores,
inventory,
plant and
equipment Yes No Yes Yes
Competitive
parity
High sales
revenue of the
company
Yes Yes No Temporary
B
Capital,
revenue,
equity Yes
Improved
financial health
of the company
C
RFID, IT
systems Yes Yes Yes Yes Sustained
Improved
integration of
the company
processes
D
Structure,
planning Yes Yes Yes Yes Sustained
Improved
organizational
co-ordination
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Intangible
Valuab
le
Rar
e
Inimitabl
e Organized Competitive Expected
Resources Advantage Performance
A
Experience Yes Yes Yes Yes Sustained
Improved
industry
knowledge
B
Company
Culture Yes No Yes Yes
Competitive
parity
Improved
customer
interaction
Yes Yes
Improved
brand image of
the company
C
Brand Equity No Yes
Competitive
Parity
D
Employee
training Yes No Yes Yes
Competitive
Parity
Improved
employee skills
and capabilities
Perspective Goal Measurement
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FINANCIAL Firm Growth &
Profitability
Increasing return on investment Return on investment
Increasing revenues/total assets Revenue/ total assets
percent
Increasing revenue/employee Revenue/employee
CUSTOMER Value Creation & Satisfaction
Increasing average customer size
of the company.
Average customer size
Enlarging customer index of
Walmart
Customer ratings
Reducing customer complaints Customer complaints
INTERNAL BUSINESS
PROCESSES
Organizational Efficiency
Minimizing lead times from
online order placing to
distribution
Average time consumed
Minimizing waiting period for the
consumers at the counters
Average waiting period
per customers in the
counters
Reducing administrative expenses
of the company
Administrative expenses
of the company
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LEARNING & GROWTH Climate that Supports Change,
Innovation, and Growth
Increasing training hours for each
employee of the company
Average training hour of
each employee
Reducing the turnover rate of the
employees in the company
Employee turnover rate
of the company
Increasing use of the view of the
employees
Empowerment Index of
the company
Problem Statement
Problem 1- One of the problems which is currently experienced by Walmart is that their
customers are moving towards competitors which is impacting their revenue. As stated by
Knezevic, Naletina & Damic (2016) as global retail industry is highly competitive in nature and
characterized by low switching costs, therefore it does not affect customers regarding switching
of brands. As all major retailers focus on generic strategy of cost leadership to attract their
customers, therefore prices of products remains more or less same among all retailers and
therefore Walmart is failing to attract new customers by virtue of cost leadership.
Problem 2- Another problem which is being faced by Walmart is lack of online sales revenues
in order to compete effectively with other online retailers. Though online sales of Walmart is
gradually increasing with each passing day but still only a fraction of total revenue is earned in
online sales. According to Plazibat & Dadić (2017) Walmart was late in seizing opportunities
which is associated with online sales and therefore it failed to create market share in online
shopping and hence even after implementing various initiatives and programs to boost online
shopping it still lags a long way behind Amazon, which is their main competitor in context of
online sales.
Problem 3- One of the major problem which Walmart experiences is high rate of employee
turnover and higher rate of dis-satisfaction of employees which is evident from reduction of
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American Customer Satisfaction Index which has placed Walmart at bottom in list of department
and discount retailers. The main reason which can be identified for increase in employee
turnover rate and employee dis-satisfaction is poor training and management practices which are
followed which has harmed brand image of Walmart in market and among their customers.
Alternative Solutions (Strategies)
Alternative solution 1- The solution which can be adopted by Walmart to prevent switching of
customers to other competitor brands can include enhancing customer service level and offering
personalized shopping experiences through both online and offline platforms. By enhancing level
of service and providing customized and personalized shopping experiences to customers,
Walmart will be able to retain their existing customers and will also be able to attract new
customers by virtue of word of mouth publicity.
Alternative solution 2- As opined by Gopalakrishna, Subramanian & Fleischmann (2016) the
solution which can be adopted by Walmart to boost their online sales includes developing their
online business model by not only providing products to customers at lowest possible prices but
also by adding incentives such as free shipping of products without any subscription fees or
charges or pick up services of products from retail stores after online shopping without extra
charges. Walmart should also provide hassle free shopping experiences to buyers regarding
online shopping such as offering convenient payment options, EMI options which will help in
boosting online sales revenue.
Alternative Solution 3- As stated by Rodriguez (2016) the solution which can be adopted by
Walmart to decrease turnover of employees and rate of employee dis-satisfaction includes
increasing hourly wages of employees which will help in motivating them to stay in the
company. Walmart should also adopt new training initiatives for their employees to increase
skills and capabilities and also initiate programs such as knowledge management and
performance management for employees to prevent them from leaving the company and remain
motivated while working.
Recommendation/ Implementation
The recommendation to Walmart to be followed at this point of time is to provide customized
shopping experiences to customers and enhance their satisfaction level which will help in
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increasing customer retention and will also help in attracting new customers. As stated by Sidi,
Haim, Abdul, Shahmir & Mohd. Rashdan (2018) this decision will help in enhancing
management of Walmart in order to provide customized service to customers and will require
more marketing activities to be carried out so as to inform their target customers. This decision
will also require more accounting activity to be carried out as it will require more finances to
support marketing activities of Walmart and this will impact their operations as it will require
change in operational activities. This particular decision will impact Information system of
Walmart as information technology tools will be required to implement this solution and this will
impact R&D activities as it will require researching and development of new support activities to
support new recommendations.
Conclusion
From above report it can be stated that competitive environment of retail industry is very much
competitive in nature as a result of presence of number of players in the industry. Further it can
also be analyzed that Walmart is one of the biggest retailers in the world by virtue of its
worldwide presence, brand equity and cost leadership strategy though it faces intense
competition from other retailers. Nonetheless it can be also analyzed that there are various
problems which are being currently faced by Walmart which is impacting the profitability and
reputation of the company in the market and therefore Walmart must adopt alternative solutions
in order to address those issues and consolidate its position in the global retail market industry.
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Rodriguez, B. (2016). Reducing employee turnover in retail environments: An analysis of
servant leadership variables.Business Premium Collection. Retrieved from
https://search.proquest.com/docview/1817354657?accountid=30552
Sidi B. A, Haim H, Abdul M. B, Shahmir S. A &Mohd. Rashdan S. (2018). The mediating
effect of cost leadership on the relationship between market penetration, market
development, and firm performance. Journal of Business and Retail Management
Research, 12(3) Retrieved from https://search.proquest.com/docview/2042789903?
accountid=30552
Vila, O. R., Bharadwaj, S. G., &Bahadir, S. C. (2015). Exploration- and exploitation-oriented
marketing strategies and sales growth in emerging markets. Customer Needs and
Solutions, 2(4), 277-289. doi:http://dx.doi.org/10.1007/s40547-015-0053-0
Appendix
APPENDIX A: SWOT MATRIX
Strengths Weaknesses
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1 Marketing strategies being
adopted by the company.
2. Large economies of scale related
with the products of the company.
3. Strong growth management
strategies adopted by the company.
4. Strong corporate culture of the
company.
5. Distribution, information
technology and inventory control
system adopted by the company.
1.
Management
of HR issues.
2. Lack of
efficiency of
the online
model of the
company.
3. High rate of
employee
turnover in the
company.
4. Lack of
international
marketing
research.
5. Lack of
manufacturing
facilities.
Opportunities
1. Obtaining
membership in
World Trade
organization.
2. Increase in trend
of shopping at
1 Building stronger government
relations
1 Setting
higher
employment
standards
through
enhanced
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superstores.
3. Intense
competition in
pricing
4. Demographics
are open to new
markets and
products
training.
2. Enter into new markets and
acquire local retailers in order to
gain market share.
2 Changing
Public relation
format to
portrait an
image of a
neighborhood
friendly
company.
Threats
1. International
Expansion barriers
2. Slow global
economic growth
3. New retail
formats
4. strong
competition in
1 Buying from local suppliers in
order to hold a better political
status
1 Developing
corporate
culture for
employee
empowerment
and decision
making
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local markets
5. Cultural
expansion and
marketing issues
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APPENDIX B: GRAND STRATEGY MATRIX (David, 2005)
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Appendix C
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Appendix D
Tangible Valuable Rare Inimitable Organized Competitive Expected
Resources Advantage Performance
A
Stores,
inventory, plant
and equipment Yes No Yes Yes
Competitive
parity
High sales
revenue of the
company
Yes Yes No Temporary
B
Capital,
revenue, equity Yes
Improved
financial health of
the company
C
RFID, IT
systems Yes Yes Yes Yes Sustained
Improved
integration of the
company
processes
D
Structure,
planning Yes Yes Yes Yes Sustained
Improved
organizational co-
ordination
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Intangible Valuable Rare Inimitable Organized Competitive Expected
Resources Advantage Performance
A
Experience Yes Yes Yes Yes Sustained
Improved
industry
knowledge
B
Company
Culture Yes No Yes Yes
Competitive
parity
Improved
customer
interaction
Yes Yes
Improved brand
image of the
company
C
Brand Equity No Yes
Competitive
Parity
D
Employee
training Yes No Yes Yes
Competitive
Parity
Improved
employee skills
and capabilities
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Appendix E
Perspective Goal Measurement
FINANCIAL Firm Growth &
Profitability
Increasing return on investment Return on investment
Increasing revenues/total assets Revenue/ total assets
percent
Increasing revenue/employee Revenue/employee
CUSTOMER Value Creation & Satisfaction
Increasing average customer size
of the company.
Average customer size
Increasing customer rating of
Walmart
Customer ratings
Reducing the number of customer
complaints
Customer complaints
INTERNAL BUSINESS
PROCESSES
Organizational Efficiency
Reducing lead times from online
orders to delivery
Average time taken
Reducing the waiting time for the
customers at the counters
Average waiting time per
customers in the counters
Reducing administrative expenses
of the company
Administrative expenses
of the company
LEARNING & GROWTH Climate that Supports Change,
Innovation, and Growth
Increasing training hours for each
employee of the company
Average training hour of
each employee
Reducing the turnover rate of the Employee turnover rate
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employees in the company of the company
Increasing use of the view of the
employees
Empowerment Index of
the company
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