Walmart Stores Inc. is a world-renowned retailer with a variety of stores around the world. Walmart operates many stores, supercenters, and other types of retail stores in the United States, claiming to be “a shining example of sustainability, corporate philanthropy, and employment opportunities.” Sam Walton founded the company in Rogers Ark in 1962, and it quickly became a corporate entity in 1969. Let us know more detail about ‘Walmart Strategic Planning’.
Walmart Strategic Planning
“Always low prices” is the first thing that comes to mind when thinking about Walmart, one of the most successful companies in the world. With daily low prices and a variety of products, they have been a well-known company for many years.
Their guiding principle is “save money so that people can live better”. Although the mission statement has been carefully selected, there is much controversy regarding this international company.
Mission Statement: Walmart Strategic Planning
“Save money so that people can lead a better life,” says WalMart’s mission. This statement is similar to the organization’s trademark “Save Money. Live Better”.The firm succeeds in meeting the mission statement’s goal of “saving people money.” Customers benefit from Walmart’s cost leadership strategy. However, it is unclear whether the organization meets the mission statement’s “live better” component. There have been reactions to Walmart’s low wages, which are barely enough for officials to make a decent living. There are also concerns about the long haul effects of the organization’s managed expansive scale offers of low-cost and occasionally unsafe imported goods.
Technology development: Walmart Strategic Planning
At Wal-Mart, technology was the lifeline of an organization and the foundation of its supply chain. Using technical tools, the organisation predicts inventory levels, efficient transportation routes, forecasting demand, managing customer relationships, and so on. It has a central database that is linked to a satellite network that is integrated at every level of the supply chain. Walmart has developed an RFID system for inventory management as well as smart tags for automated reordering of goods as they exit stores, resulting in greater operational efficiency across the chain.
Walmart Business Strategy: Walmart Strategic Planning
Wal-Mart’s cost leadership strategy is to be the most cost-effective company in the field and to develop unique products that customers are willing to pay for the best prices. Focusing strategies are further divided into cost-focusing strategies and differentiating strategies, thus focusing on addressing specific sections in that area by tailoring products or services to the needs of consumers.
Strategic goal: Walmart Strategic Planning
There are four strategic objective frameworks. First, Walmart aims to dominate the retail market in all areas in which it exists.Second, the company intends to expand its presence in the United States and around the world. Third, Walmart aims to increase brand recognition worldwide and satisfy customers at the cheapest prices on the market. Fourth, Walmart is focusing on expanding into new markets such as auto repair products and pharmaceuticals.
One of the main goals is to gain control of the retail market. WalMart recognizes a significant competitive advantage by selling products at high discounts that customers cannot find anywhere else. As a result, by lowering the markup and cutting prices, the company can profit from the high volume of sales. Another aspect of this strategic goal is to be competitive in all areas of the company. Wal-Mart encourages each store to compete with all other stores in the region to dominate local retail stores. All Walmart owned stores are encouraged to compete with all other stores in the region to dominate the local retail market.
The successful implementation of the company’s strategic goal of growth and expansion in domestic and international markets. According to WalMart’s 2015 annual report, the company can now not only generate additional sales in countries such as Brazil and China, but also sell cheap products online.
Competitive strategy: Walmart Strategic Planning
Wal-Mart’s competitive strategy is tied to running all businesses. To follow a competitive strategy, Wal-Mart combines two aspects: differentiation and cost leadership. The company offers a wide range of products and services of the same quality as its competitors, at significantly lower prices than its competitors. The company’s management strives to find different ways to reduce costs while maintaining a competitive degree of differentiation.
The success achieved in supply chain management is one of the most effective ways to implement and implement cost leadership strategies. In addition, the just-in-time inventory provides efficient inbound logistics.
Outbound Logistics is created by optimizing the fuel efficiency of the company’s delivery trucks and reducing the number of empty miles. In addition, the company has succeeded in reducing costs by purchasing products from suppliers in large blocks. Technological advances also play an important role in Wal-Mart’s supply chain. Technology enables company management to anticipate future demand for a particular product, track and manage inventory levels, and build trust with potential and existing customers. In summary, Wal-Mart’s differentiation and successful cost leadership strategies have made the company a strong competitor in the retail industry.
Strategy Development: Walmart Strategic Planning
Strategy development is the process of evaluating a company’s strategy and selecting the most efficient strategy to achieve the goals set by business owners. Walmart’s current strategies include product, service, retail, and marketing communications strategies.
- From a product strategy point of view, Walmart provides its customers with a diverse range of branded products at the most competitive prices. For quality testing and approval, such brands interact with a large number of customers and suppliers. Walmart makes the necessary changes to the quality of branded products after testing to meet customer demand.
- Walmart’s retail strategy is based on the concept of neighborhood markets. This will enable the company to establish neighborhood markets in place of large grocery stores.
Neighboring stores are much smaller than supercenters and are primarily focused on offering fresh, high-quality products.
- With the launch of the “Save Money, Live Better” advertising campaign, Walmart has focused on keeping the company low and earning the trust of its customers. In addition, social media has become a tool for promoting products, answering customer questions, and building brand loyalty.
- Walmart’s operational service strategy involves training employees to provide first-class service to their customers.Furthermore, Walmart can now provide online shopping services, allowing customers to purchase groceries without leaving their homes. Customers can use the Scan & Go app for smartphones to look up product prices, scan product barcodes, and shop for themselves. Therefore, when it comes to service, Walmart offers many customer amenities.
SWOT Analysis: Walmart Strategic Planning
Strength
Walmart is the largest retail group, with 10,000 stores worldwide and earning more than $ 400 billion annually. Therefore, by lowering product prices so that you can sell at a lower price than your competitors, you can use your considerable force to attract more potential customers and influence your suppliers.
One of the company’s greatest assets is its cost leadership strategy. Wal-Mart is committed to offering high-quality products at low cost, making it very difficult for competitors to compete at such prices.
Weakness
In terms of weaknesses, Wal-Mart has a negative reputation as an employer that saves money for its employees. Employees often gave negative feedback on poor working conditions, overtime pay, and discrimination against female workers. Therefore, employee abuse leads to high employee turnover and a bad reputation.
Opportunity
One of Wal-Mart’s most positive opportunities is to continue investing in international business. International markets offer companies new opportunities and experiences, especially in emerging markets. In addition, private label products sell so well that you have the opportunity to expand the range of private label items sold at Walmart.
Threat
When it comes to becoming a “green” company, there are conflicting interests associated with the company. Despite the company’s growth potential, it is significantly cheaper to produce pork industrially, for example, compared to free-range pastured pigs raised on small, eco-friendly farms.
Conclusion
Based on SWOT analysis, Wal-Mart’s assessment of strategic goals, and implemented strategic approaches, companies can encourage them to leverage the strengths and opportunities of the global retail market to prioritize their strategies. Weaknesses and threats should only be prioritized if management sees a significant increase in revenue due to its focus on opportunities and strengths.
With the expansion of online retailers worldwide, one of Wal-Mart’s most promising opportunities, the main focus will be on developing an efficient online retail strategy that is competitive enough to keep up with Amazon’s success.
FAQs
- Should Walmart continue to expand its business?
Walmart should continue to expand its business into emerging markets. Despite the fact that price and cultural differences may present a challenge for the company’s management, the brand’s expansion will provide a significant opportunity for growth. Foreign market expansion can be successful because the company’s strengths are associated with its large size, ability to penetrate the global supply chain, and ability to provide products at very reasonable prices.
- What are the goals of Walmart’s operations management?
One of Walmart’s operational management objectives is to maximize productivity and minimize costs as part of a general cost leadership strategy. There are various quantitative and qualitative criteria or productivity measures related to retail organization talent and related internal business processes.
