Wal Mart Case Study

WAL-MART CASE STUDY

Wal-Mart Stores, inc. is the world's largest retail company and is ranked number one for 2013 on the Forbes Fortune 500 list with an estimated revenue of 469.2 billion. Wal-Mart currently serves customers in ways of, retail outlets, online and on mobile devices. Wal-Mart employees' 2.2 million associates around the world, with 1.3 in United States alone. Wal-Mart operates 11,000 retail units in 27 countries and ecommerce websites in 10 countries. Sam Walton founded the retail giant in 1962 with emphasis on people, taking care of employees and help the people in small towns and rural America.

Wal-Mart's success exceeded even Walton's expectations. H. Lee Scott, Jr. said that in many ways Walton would be pleased with where Wal-Mart was in 2003 but other ways he would be disappointed. Wal-Mart has challenges today that executives have put into strategic plans to fight, employee benefits, public reputation and slowing sales gains. These challenges are just a few struggles Wal-Mart's CEOs are having to face today. Strategic initiatives are being put in place to combat company specific and industry wide struggles and rise the retail business to a place Walton would be pleased with.

Doug McMillon, who will the current CEO of Wal-Mart on February first will be facing the challenges that have risen for the retail organization. Wal-Mart has been showing slow sales gains, store sales have dropped for the third consecutive quarter and fourth quarter earnings per share have shown on the low end of expectations. These lower sales have warned that sales will continue to be flat (Rivas, 2013). Wal-Mart brands itself as offering low prices every day, this might cause Wal-Mart to lose opportunities and growth. The retail store has attempted to grow

WAL-MART CASE STUDY

beyond the price sensitive customer, importing upscale goods and creating a convenience store concept, this has had little success (Payton, Winter2005). Price sensitive customers tend to not have brand loyalty, they will move to retailers that offer the lowest price. Customers might switch over to their competitors in the future (Rugman & Dossett, 2005).

Wal-Mart has struggled with a bad reputation. They have gained a negative reputation over its anti-competitive business practices, treatment of staff and impacts on the environment. Wal-Mart's bad reputation might mean communities refusing to allow stores to be entering their towns, a loss of outreach (Chron, 2012). Wal-Mart scored one of the lowest in the American Customer Satisfaction Index from the University of Michigan in 2008 (Wal-Mart as Leviathan, 2004). Poor customer service could turn these customer to their competitors, and lack of products could force selective customers to look elsewhere. Wal-Mart imports almost 80% of non-food items from China. The