Walmart SWOT

SWOT Analysis Wal-Mart

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Strengths

  • Wal-Mart is a powerful retail brand. It has a reputation for value for money, convenience and a wide range of products all in one store.
  • Wal-Mart has grown substantially over recent years, and has experienced global expansion (for example its purchase of the United Kingdom based retailer ASDA).

Opportunities

  • To take over, merge with, or form strategic alliances with other global retailers, focusing on specific markets such as Europe or the Greater China Region.
  • The stores are currently only trade in a relatively small number of countries. Therefore there are tremendous opportunities for future business in expanding consumer markets, such as China and India.
  • New locations and store types offer Wal-Mart opportunities to exploit market development. They diversified from large super centres, to local and mall-based sites.
  • Opportunities exist for Wal-Mart to continue with its current strategy of large, super centres.

Threats

  • Being number one means that you are the target of competition, locally and globally.
  • Being a global retailer means that you are exposed to political problems in the countries that you operate in.
  • The cost of producing many consumer products tends to have fallen because of lower manufacturing costs. Manufacturing cost have fallen due to outsourcing to low-cost regions of the World. This has lead to price competition, resulting in price deflation in some ranges. Intense price competition is a threat.

‘Wal-Mart Stores, Inc. is the world’s largest retailer, with $256.3 billion in sales in the fiscal year ending Jan. 31, 2004. The company employs 1.6 million associates worldwide through more than 3,600 facilities in the United States and more than 1,570 units. Read more…

Disclaimer:
This case study has been compiled from information freely available from public sources. It is merely intended to be used for educational purposes only.

  • The company has a core competence involving its use of information technology to support its international logistics system. For example, it can see how individual products are performing country-wide, store-by-store at a glance. IT also supports Wal-Mart’s efficient procurement.
  • A focused strategy is in place for human resource management and development. People are key to Wal-Mart’s business and it invests time and money in training people, and retaining a developing them.

Weaknesses

  • Wal-Mart is the World’s largest grocery retailer and control of its empire, despite its IT advantages, could leave it weak in some areas due to the huge span of control.
  • Since Wal-Mart sell products across many sectors (such as clothing, food, or stationary), it may not have the flexibility of some of its more focused competitors.
  • The company is global, but has has a presence in relatively few countries Worldwide.