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PRODUCT MANAGEMENT:- PRESENTATION ON

Presented By:-Gaurav Patil

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SECTORIAL ANALYSIS Worldwide total retail sales were more than

$22 Trillion in 2014, which in 2015 reached $24 Trillion (report from eMarketer.com)

Estimated 2/3rd of the GDP of USA comes from retail sector

76 of the World’s Largest Retailing Company are US based

www.retailindustry.about.com

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SECTORIAL ANALYSIS (INDIA) Market size of Indian Retail Industry is $600

billion in 2015 Industry is Expected to grow up to $1.3

trillion in 2020 Super market is increased from 500 in 2006

to 8500 in 2016 Online Retail is projected to grow to $70

billion by 2020 from $6 billion in 2015www.IBEF.org

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SECTORIAL ANALYSIS (INDIA)

www.IBEF.org

Retail

Grocery Food & Beverage

Department Store Pharmacy Book, music

and gifts

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WAL-MART CEO: C. Douglas Mcmillon Founder: Sam Walton Founded: July 2, 1962, Roges, Arkansas, US Revenue: $482.1 billion (2015) Headquarters: Bentonville, Arkansas, US Net income: 14.69 billion USD (2015) Stock Price: WMT (NYSE) US$ 69.22

www.wikipedia.com

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HISTORY OF WAL-MART In 1950, Sam walton purchased  a store from Luther E.

Harrison in Bentonville By 1967, the company grew to 24 stores and had

reached $12.6 million in sales The company's first stock split occurred in May 1972 at

a market price of $47 25th anniversary in 1987 Wal-Mart was ranked fifth by Fortune magazine on its

Global Most Admired All-Stars list and in 2003 and 2004

www.wikipedia.com

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COMPETITORS General Merchandise Retailing

Kmart and Target

Warehouse club Segment Costco

Super Market Retailing Kroger, Albertson’s and Safeway

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CORE STRATEGIES Low – cost Leadership Supplying wide selection of the lowest – cost

general merchandise Controlling its cost drivers and relentlessly

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WAL-MART'S VALUE CHAIN Primary Activities and Costs

Secondary Activities and Costs

Supply Chain

Management

Distribution Sales & Marketing

Customer Service Profit Margin

Technology and Systems DevelopmentHuman Resources ManagementGeneral Administration

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CUSTOMER TARGET

“Wal-Mart's targeted demographic: Modest incomes Shoppers interested in prices

But the customer base is changing

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PORTER’S FIVE FORCE MODEL

1.Bargaining Power of Customers: Low Customers usually make small purchases. A large number of customers. Wal-Mart’s main customers are individuals.

2.Bargaining Power of Suppliers: Moderate Wal-Mart purchases huge quantities of products from its

suppliers. Low switching costs from one supplier to another. Products have a lot of substitutes. Almost all the products are not critical for Wal-Mart.

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PORTER’S FIVE FORCE MODEL3.Potential entrants / Barriers to entry: Medium-High

Economies of scale. High capital requirements. Customers mainly look for products with low prices and

standard quality. Low switching costs among companies for customers. Requires a precise distribution system.

4.Power of Substitutes: High Prices and quality of substitute products are very

competitive. Performance of substitute products are similar. Consumer switching costs are low.

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PORTER’S FIVE FORCE MODEL

5.Potential Competitors/ Rivalry: High Wal-Mart represents the 25% share of the U.S.

Supermarket business. Competitors have similar sizes. Industry growth is slow. Exit barriers are high. There is a high production capacity

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STRENGTH

• Diversity in products & services• Convenient prices & locations• Strong market presence• Customer loyalty• Strong financial performance• Cost and pricing advantages over rivals

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WEAKNESS

• Brand image-weak reputation• Low global presence• Behind rivals in e-commerce

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OPPORTUNITIES

• Global Expansion: new geographic areas• Increasing online sales• Strategic alliances• Acquiring rival firms

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THREATS• Intense Competition• Laws and Regulations • Trade policy• Cultural barriers• Current economy • Slow market growth• Transport of distinctive• Competency

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BACKWARD INTEGRATION

Backward integration refers to a company buying or internally producing parts of its supply chain.

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BACKWARD EXPANSION IN WAL-MART Acquire McLane company, Texas retail

grocery supplier Not dependent on a single supplier Investing in suppliers if they need funds They learned how manufacturer are

performing

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DISTRIBUTION CENTERS

• ECONOMIES OF SCALE• HUB AND SPOKE MODEL• CUT OUT THE MIDDLE MAN• INVENTORY TURNOVER• HIGH STORE VOLUME

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Inbound Logistics First users of EDI to communicate with suppliers High bargain power

Operation They uniquely operate each store Better in store execution than competitors

Outbound Logistics Low Distribution cost

Marketing & Sales Unbeatable Prices

Service

ACTIVITIES

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WAL-MART’S STRATEGIES EXECUTION PROCESS Use of cutting – edge technology Providing superior customer service and

striving for continuous improvement Implementing a corporate culture Strong management team State of the art training resources

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TECHNOLOGY

Retail Link Inventory Turnover Electronic Data Interchange (EDI)

Electronic Purchasing order Tracking sales

Information system in communication with vendors Identifying low selling item

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Thank You …!!!