Wal-Mart Stores

In 1962, Sam Walton had a vision of providing low cost goods to small town residents who

had to commute 4 or more hours to find a retailer. Throughout the decades, the Walmart

brand has scaled greatly and has increased their number of stores to 4,672 and 660 Sam's

Clubs as of 2016. By planning and implementing different business and functional strategies,

the company ultimately became the largest retailer in the U.S. with low prices across the

board.

When the idea of Walmart came to fruition, Sam Waltons goal was to focus on offering a

wide range of products at the lowest possible price. This became Walmart's primary

business strategy with the company even coining their popular "Everyday Low Prices"

motto. To accomplish his objective of providing low-cost goods to families in rural areas,

he had to find an inexpensive source of supply. At the beginning, "Walmart sourced

products directly from manufacturers, targeting a 30% gross margin. Any discounts

Walmart could secure were passed on the consumer" (Porter & Vallejo, 2019; p.1). As

the company grew in size and revenue, they found more ways to provide low yet

profitable prices. Furthermore, they pressed suppliers for lower prices and began

investing in distribution center which consolidated loads from suppliers and shipped

directly to stores. During the 70s, they continued to expand at a quicker rate. As they

proceeded to upscale, they found numerous way to cut down unneccessary costs, such

as dealing directly with suppliers instead of using a distributor's or manufacturers

representative. In the midst of their peak, their primary focus also turned to

Supercenters as consumers were able to buy a large assortment of products for

Walmart's renowned low prices. Starting in 2003, the Walmart CEO at the time, Lee

Scott, decided to delve into sustainability; he had a vision to move to renewable energy

as well as converting zero waste and sell products that were environmentally

sustainable. Adding on to this change in pace in 2016, was current CEO Doug

McMillon's ethical ventures such as the decision for Walmart to join the Leadership

Group for Responsible Recruitment (p.15).

These ideas developed from an original business strategy, but without the help of low-

scale associates and team members, this strategy would not have been efficiently and

effectively implemented. Using a functional strategy to focus on the different

organizational areas of Walmart, these ideas were put into action and are part of the

reason why Walmart is the top retailer in the U.S.

There were many functional strategies that were mentioned in the Walmart case with

the focus of marketing, environmental, and social endeavors. They continuously

appealed to customers by having prices consistently low as opposed to using

promotional and commercial discounts. They eventually "expanded the use of private

brands to support its lowest price strategy" (Porter & Vallejo, 2019; p.3). Walmart also

implemented the opening of new departments in the store as well as renting space to

various services such as nail salons, food outlets, and tax preparation services. These

additions were formulated to attract more customers with their low cost strategy. Moving

on to their environmental endeavors, to fulfill Lee Scott's dream to focus on sustainbility,

Walmart has achieved things such as 100% sustainable sourcing from private palm oil

companies and beef in Brazil (p.15), and increasing usage of recycable products and

packaging. Through this they also reduced waste by 75% (p.14). For Walmart's ethical

endeavors, they focused primarily on philanthrophy and enabling more rights for

workers. Their own corporate giving program focused on "economic opportunity,

enhancing sustainability, and community areas while also having donated over $1.4

billion in cash and $300 million in grants and 600 million pounds of food" (p.16).

Walmart has also focused on worker's right; more specifically, they implemented an

$100 million initiative to change practices in the entire retail industry and increase

mobility for all workers" (p.14). Their functional strategy for this vision was to provide

better health benefits and help develop skills within current Walmart employees.

questions

*** Please rewrite the above case answer in 250words count with below outline

Read the Wal-Mart Case and using the assessment approach described in Lesson

1 (review the PowerPoint on Assessment, pp:1- 15), and the video posted in this

module on assessment (see above).

2. Then discuss the Business Strategy and the Functional Strategies of Wal-Mart.

For each strategy state the following:

a) Objectives - Desired ends

b) Tactics - Steps (management decisions and actions) taken to achieve the

objectives