CASE STUDY: WALMART

CASE STUDY: WALMART RESOURCE PERSONS:WILLIAM PEREZNORGEE PARENO

HISTORY

Declining of Sales of International Segment of Walmart Net Sales Increase from 24.1% to 9.1%.MAIN PROBLEM

2009TIME Context

POINT OF VIEW

To increase the Sales International Segment of WALMART from 9.1% to 15% in the next fiscal year 2010.STATEMENT OF OBJECTIVE:

S.W.O.T ANALYSISAREAS OF CONSIDERATION

The following are the reasons and strong foundation why Walmart is still existing and continuous to be the biggest player in retail industry.

Financial StrengthGlobal Stores and PartnersExperience in large scale retailing

Walmarts financial strength gives the company the leverage in acquiring competition as well expansion. The Global store branches provide lump sum value to the overall profit of the company, it also maintains it momentum in invading overseas. Lastly, with more than 50 years of expertise in retail WalMart have changed the landscape and continuously innovate the industry.

Walmarts Strengths(Internal)

Basically the weaknesses of Walmart as a business have been identified many years ago, it revolves on the stronghold to its traditional practices and company failure to exceed the previous sales.

Downward trend in the annual sales profit for its International StoresStrong presence of traditional management

This is due to stagnant consumer demand in their overseas stores. The management model in terms of handling their people are still observed like prohibits employee from dating.

Walmarts Weaknesses(Internal)

Since the expansion is the main opportunity of Walmart, we have identified only 1 item;

Expansion in Industrial-developing geographies such as SEA

In the recent count of international WalMart Stores, there are no stores or plans in expanding their business. SEA regions have been cited as one of the fastest growing economies, In countries like Singapore, Thailand, Philippines, Malaysia, Indonesia and so forth. The buying power of the people in this region is considered to be one of the strongest in Asia.

Opportunities for Walmart (external)

We have identified 2 threats to Walmarts business and they are more likely linked to retail market conditions and customer perception about the products and services rendered.

Aggressive competitionHealthy lifestyle trend

Plenty of big and small competitors are playing and luring customers which take big-chunk of sales profit every year. Competitions like Costco Wholesale, Target and Dollar General Corp. use aggressive marketing and strategies which are observed by market analysts. And with the current trend and fad where most convenience stores and retail stores offers organic and health-conscious products and to add promoting healthy lifestyle competitions are in advantage as they appeal to the consumers very well.

Threats Facing Walmart(external)

Expansion of business through joint partnership with leaders in retailing companies in the Southeast Asia region.

Set up new business in South East Asia region.

ALTERNATIVE COURSE of action (ACA)

ACA # 1ACA # 2GainsGains Retaining quality - whether it is staffing or additional skills, knowledge of your industry or sector and other business intelligence. Wide range of Access - whether it is funds or valuable assets for new development. Better production or distribution facilities are often less expensive to buy than to build. Look for target businesses that are only marginally profitable and have large unused capacity which can be bought at a small premium to net asset value. Wider scope and access in your target customer base and increasing your market share. Your target business may have distribution channels and systems you can use for your own offers. Diversification of the products, services and long-term prospects of your business. A target business may be able to offer you products or services which you can sell through your own distribution channels. Reducing your costs and overheads through shared marketing budgets, increased purchasing power and lower costs. Reducing competition. Buying up new intellectual property, products or services may be cheaper than developing these yourself. Organic growth, ie the existing business plan for growth, needs to be accelerated. Businesses in the same sector or location can combine resources to reduce costs, eliminate duplicated facilities or departments and increase revenue. Lower start-up costs - Depending on the type of business you start, costs may be lower than a franchise where there is no up-front purchasing fee or supply costs Independence - You make all decisions and create all business systems Site selection - You choose where to locate your business and what marketing procedures to follow No baggage - There is no history to overcome when you start a new venture

LossesLosses Creates high stake of stress within employees of each organization Possibility of an increase amount of inherited debt Differences in corporate culture that are not easy to consolidate It isnt a one person decision most of the time High commitment - Starting your own business requires a higher commitment of time and energy High risk - Success depends totally on you and your business talents Delayed profitability - Where the market may not already be established, it may take longer to become profitable Limited financing - Financing for a new business is more difficult to obtain

QUALITATIVE ANALYSIS

CriteriaACA # 1ACA # 2Profitability 32Cost efficiency22Operations32Manpower31Total117

QUANTITATIVE ANALYSIS(Decision matrix)Legend:1. Good 2. Better 3 - Best

ACTIVITIESPerson ResponsibleTimeframeSend and set-up a meeting with the CEO for International Walmart StoresDavid Cheesewright1-2 weeksPresentation of the proposed plan, project ,marketing, financial and strategic planningDavid Cheesewright2 weeks to 2 monthsApprovals and suggestions from the executivesDavid Cheesewright5-7 business days

PLAN of action

From the comparison made between qualitative and quantitative data, we have identified and concluded that;

Option 1, which is the ACA #1 shows its potential and leverage in increasing sales profit for Walmart international Stores. It has been identified that by using this option Walmart is reducing it competition at same time broaden it market.

The target of 15% increase in the annual sales is attainable, as consumers in the SEA region are very eager and has the money to buy the Walmart products.CONCLUSION

www.walmart.comhttp://corporate.walmart.com/our-story/our-historyhttp://corporate.walmart.com/our-story/leadership/executive-management/mike-dukehttps://www.ft.com/content/cbcb3f9e-d640-11e5-8887-98e7feb46f27http://www.usnews.com/opinion/economic-intelligence/2015/11/25/the-real-reason-wal-marts-profits-are-hurtinghttp://www.icaew.com/mwg-internal/de5fs23hu73ds/progress?id=0K_7j66iwp4NBH20DTcufpwmXKlYAwQlpS_Zp_nO9ho,&dlhttp://financials.morningstar.com/competitors/industry-peer.action?t=WMThttps://www.youtube.com/watch?v=ANdUwsKkB6I

References