Walmart Stores, Inc: On Becoming the World’s Largest Company

Wal-Mart Stores, Inc: On Becoming the World’s Largest Company (2002)

A. Executive Summary:

Purpose Statement:

The purpose of this study is to determine on how Wal-Mart had responded to one of the most challenging period in its history (2001) and study the ways on how to make the firm to continue to be the leading retailing store in the industry.

Problem Statement:

1. Slow consumer spending

2. Rising unemployment

3. Energy crisis

4. Terrorist events last September 11, 2001

Alternative Courses of Action:

1. Discover the possibility of introducing innovative practices.

2. Find new expansion programs

3. Expand and develop more marketing strategies

4. Mounting more stores abroad

5. Advancement in internet technology to allow better service of information and convenience

Methods of Analysis:

The methods of Analysis used in the case are SWOT Analysis, PEST Analysis and Financial analysis.

Recommendation:

The recommended alternatives can help the company lessen the current challenges it faced and help Wal-Mart stay as the leading retail store in the industry.

Conclusion:

Companies can expand globally to achieve benefits similar to diversifying into new industries. These industries can maintain their growth force and extend their competitive advantage into the new markets.

B. Methods of Analysis

PEST Analysis

Political Environment

The terrorist attack primarily changed the way many industries operated. The risks of the terrorist’s actions will likely to continue to grow as rebel and what their supporters looked for was to hurt American wellbeing around the world. This was also one of the problems Wal-Mart Stores have encountered which lead to a very difficult point in time in many retailing industry. Wal-Mart getting bigger and increasing globally is a sign of good opportunities coming in but they also have many positive competitive response and government limitations.

Economical Environment

Wal-Mart found strength in calling their employees “associates” rather than clerks. In this case they treat their employees as if they were their partners in the business and that would make their employees feel good. And so the more they would want to work and make the industry boom as if it was their own. The economical environment of Wal-Mart would then increase for people works harder and would have more responsibility.

Social/Cultural Environment

Sam Walton said, “Our goal has always been in our business to be the very best”, and in order to do that, make a good circumstance and put the associates first. The reason for the success of Wal-Mart is their people, the way that they are treated and the way they feel about the company. People first have guided the company through the challenges and slow down that allowed the company to foremost its consistent record of growth and expansion in later years.

Several programs were launched in Wal-Mart stores to bring to light popular social causes. The Buy-American program was to correspond Wal-Mart’s support for American manufacturing. It gave manufacturers the confidence to buy goods in the United States rather than to import them from other countries.

Technological Development

Wal-Mart had various advanced equipments