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7/29/2019 walmart-090626055332-phpapp01
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Presented by-
Viplove singh
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WALMARTTYPE - Public ( NYSE) FOUNDER - Sam Walton
FOUNDED- Rogers, Arkansas(1962) HEADQUARTERS Bentonville ,Arkansas
CEO - H. Lee ScottCHAIRMAN- S. Robson Walton
PRODUCTS - Supercentres,neighborhood
Market Cap.- US$ 228 Bn. (2007) SALES-$374.5 billion(2008)
EMPLOYEES- 2.1 Million AREA SERVED Worldwide
INDUSTRY Retail Discount stores OPERATIONS -16 Countries
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Overview of Wal-Mart
Retail UnitsWorldwide 7,390
US Retail Units 4,219Wal-Mart Stores 920Supercenters 2,565Sams Clubs 593Neighborhood Market 141
International Retail
Units3,171
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History of Wal-Mart
In 1945 Sam Waltonopened the first BenFranklin franchise inNewport Arkansas andoperated them with his
wife, Helen and brother,Bud.
These were small chainsthat were very successful.
In November of 1962
Wal-Mart was opened. Wasnt until mid 1970s
that Wal-Mart began togrow.
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Important Facts
Wal-Mart employs 2.1 million associates worldwide inmore than 4219 stores in the US and more than 3171throughout the rest of the world.
They serve more than 176 million customers per week.
its 5 forces tend to have a positive effect on the company.The company has high barriers of entry, a moderatethreat of rivalry with Target and Kmart due to itsexpansion of super centers, and its incredible power overall its suppliers because Wal-Mart purchases so many
products, the suppliers have little negotiating powers,and finally Wal-Mart technically has a great amount ofpower over its buyers because of its product variety andlow prices.
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Cont.
Wal-Mart is a retail phenomena that has grown from a backwoodsdiscount store into a company that accounts for nearly 17% ofgeneral merchandise, apparel, and furniture sales in the U.S. as wellas generating enough revenue to rank 30th in the world's economies,right behind Saudi Arabia (Forbes, 2004) .
Wal-Mart Stores, Inc. operates Wal-Mart discount stores,Supercenters, Neighborhood Markets and Sams Club locations inthe United States. The Company operates in Argentina, Brazil,Canada, China, Costa Rica, El Salvador, Guatemala, Honduras,Japan, Mexico, Nicaragua, Puerto Rico and the United Kingdom.
The Companys securities are listed on the New York StockExchange
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Supply chain management
Wal-Marts merchandise replenishment cycle is no more than 48 hrs Fleet of 7,000 trucks in US
Point-of-sale
system
captures data
in real-time
Data is
transmitted to
warehouses
for Inv. Mgmt.
Retail Link
transmits
data to
supplier
Orders are
generated from
previous-day
sales
Merchandise is
loaded onto
trucks using
cross-docking
Merchandise
is delivered to
the store
Merchandise is
manufactured
based on historical
and real-time data
Merchandise
is shipped to
warehouses
Customer
made a
purchase
The store will re-
stock the shelves
with merchandise
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Cont.
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The US-based Wal-Mart, the largest retailer in the world, is believed tobe the best supply chain operator of all times. Much of the efficiencyachieved by the company in managing its supply chain is because ofits proactive use of IT and Internet-enabled technologies.
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Cont.
Probably the number one thing that led to success is their world class supplychain. Wal-Marts supply chain is remarkable and really allows them to cutcost by eliminating unneeded steps. For instance their supply chain is sohigh tech that it can notify Wal-Marts suppliers directly (cutting out workerintervention) when inventory is low for certain products. Another internal
strength that has lead to Wal-Marts success is its ability to focus on drivingcosts down to ensure every day low prices. Wal-Mart has never drifted awayfrom this motto.
They have successfully designed a distribution system that allows them toaccomplish the impossible: efficiently and effectively re-supply their 3,500+stores in a quarter of the time of their competition. They also utilize
Electronic Data Interchange technology to shorten the distribution cycleand as well as other technologies such as RFID to automate tasks. Wal-Marts internal trends continue to include their low cost mode of operation,their innovative spirit which is particularly noticeable in their managementof their supply chain
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Successful usage of SCM
Using IT in Supply Chain Management
Wal-Mart employed the most advanced IT tools and applications inall supply chain functions, starting from demand forecasting,procurement, logistics, distribution and inventory management. Thecompany focused on bringing efficiency to every function of the
supply chain so as to offer its customers products at the lowestpossible prices.
Using The Internet In Supply Chain Management
Wal-Mart is integrating its supply chains with major customers.Wal-Mart is an innovator in SCM, which has helped it to provide
low-cost merchandise to its customers and undercut its competitors
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Wal-martS PRODUCTATTRIBUTES
What are the 4 key product attributes???
.product cost, product delivery-response time,product variety, product quality
Wal-marts product cost? Low
Wal-marts product delivery-response time? Low
Wal-marts product variety? High
Wal-marts product quality? Moderate-high
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Wal-Marts strategyand operations
structure
Enable everyday low price and above average profitabilityby procuring , distribution and selling products, when andwhere needed at lower cost than any competitor
Operations strategy
Short response times Low inventory level
Operation structure
Fast transportation system Cross docking Retail link between wal-mart and suppliers (DSS)
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Wal-mart Strategy
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Mission Statement
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Their Vision Statement
"The secret of successful retailing is to give yourcustomers what they want. And really, if youthink about it from your point of view as a
customer, you want everything: a wideassortment of good-quality merchandise; thelowest possible prices; guaranteed satisfactionwith what you buy; friendly, knowledgeable
service; convenient hours; free parking; apleasant shopping experience."
- Sam Walton (1918-1992)
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New Mission Statement
Our mission is to provide goods and services for our customers ateveryday low prices. With our innovative technology we strive tohave merchandise ranging from food, clothes, music, etc. on hand24 hours a day 7 days a week. We are committed to the growth ofWal-Mart and challenge ourselves to be better. We strive to have the
best, be the best, and provide quality and assurance to ourcustomers. Our employees are a huge asset to our company, and wewould not be the company we are today without them. They have ahuge impact on what our company was, what it is, and what it willbe. We also feel it is important to give generously to those who are
less fortunate than others, which is why Wal-Mart donatesthousands of dollars a year to different organizations.
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New Vision Statement
Our vision is to provide good quality andservices to our customers while remainingthe market leader and striving daily to be
the most admired company.
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Divisions of WAL-MART
NeighborhoodMarkets
International
Sams Club
Supercenters
Distribution Centers
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Neighborhood Markets
Began in 1998
Located in market with Wal-MartSupercenters
Average area about 42000 sq. ft.
132 stores in U. S. Offers customer groceries, pharmaceuticals
& general merchandise.
Provides about 28,000 items to customers.
Neighborhood Markets are used to fill the
gap between Discount Stores andSupercenters.
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International
Wal-Mart's internationaloperations currently comprise2980 stores in 14 countriesoutside U. S.
It accounts for 20% of sales
In U. K. only 42.7% sales ofinternational division.
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supercenters
These are hypermarkets
Avg. size 197000 sq. ft.
Additional discount stores theyhave meat and poultry, baked
goods, frozen foods ,dairyproducts , sea foods ,gardenrelated, pet shops, opticalcentre, fast food outlets, hairand nail saloons, local bankbranches ,gasoline etc.
2447 supercenters in U. S. A.
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DISCOUNT STORES
These aredepartmental storesapprox avg. size
102000sq. Ft. They have general
merchandise andselection of foods
971 discount stores inU.S.
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Worldly Stores
CountryDISCOUNT
STORESSUPERCENT
ERSSAM'S
CLUBSNEIGHBORHOOD
MARKETS
Argentina 0 11 0 0
Brazil 0 12 8 2
Canada 213 0 0 0
China 0 20 4 2
Germany 0 94 0 0
Korea 0 15 0 0
Mexico 472 75 50 0
Puerto Rico 9 1 9 33United Kingdom 248 10 0 0
InternationalTotals 942 238 71 37
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Stores in US and World
U.S. Totals 1568 1258 525 49
GrandTotals 2510 1496 596 86
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BCG
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External Factors
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Key External Factors in U. S.
Opportunities Fortunes number one Most Admired Company and
largest company in nation Worlds largest private satellite communication
systems Ron Brown Corporate Leadership Award
Threats TargetA solution to the monopoly that Wal-Mart has created
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Internal Factors
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Key Internal Factors in U. S.
Strengths Stores in all 50 states New concepts:
Hypermarkets, supermarkets
Wide variety of merchandise
Nationally advertised merchandise Limited lines of merchandise made in USA Point-of-sale bar code scanning Great employee benefits
Weaknesses
No formal mission statement Management resisted putting women on board of directors Hiring illegal minorities to clean Growth for employees only in division
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SWOT OF WAL-MART
strength(internal)R&D, high techDeep pockets,Infrastructure,Luxury car/ truck dominance,Infrastructure/ small cars,Distribution network ,
Joint Ventures
Opportunity(external)Worldwide presenceExpansionBuy U.S.Leverage tech. and financial know-howBetter segmentationCompetition
weakness(internal)Lead timesDifferentiated modelsPlatform madness
Productivity, efficiency, costsBureaucracy/ leadershipIncentive systemVertical integration
threats(external)CompetitionLabor unrestBrand loyalty disappearance
Perception, quality, reliability, durabilityConsumer social awarenessRising costsSupplier backlash
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Different Strategies
Add more hypermarkets andsupermarkets to establish more growth
Buy products from other countries to havemore of a variety of merchandise andbetter quality merchandise for customers
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Sourcing from india
For the past 3 years, the sourcing from India hasbeen growing at 30% every year with acumulative figure of goods worth $1.2 billion.
Now, it intends to grow this by40 per cent. Wal-Mart has been sourcing goods from India since2001.
Item sourced-textiles, leather, jewellery,food
items like basmati rice, tea, spices , sea food Sourcing office located in Bangalore
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Bharti and wal-mart venture
Bharti-Wal-Mart venture would make an initial investment of US$100 million
Wal-Mart's logistics skill and Bharti's execution capability will createa potent force in the Indian market.
Wal-Mart will operate through franchises and handle the wholesaleend
Bharti will manage the front end involving opening of retail outlets,while Wal-Mart will take care of the back end, such as cold chainsand logistics.
The partnership may seem odd, since Bharti has no experience indiscount and grocery stores. But Bharti, the No. 1 cellphonecompany here, has a vast retail distribution network and aknowledge of the buying habits of Indias middle class. Moreover,Bharti has a good flow of cash, which could help Wal-Mart expand
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About Bharti Enterprises
Bharti Enterprises is one of Indias leading business groups withinterests in telecom, agribusiness, insurance and retail. Bharti has been apioneering force in the telecom sector with many firsts and innovations toits credit. Bharti Airtel Limited, a group company, is one of Indias leadingprivate sector providers of telecommunications services with an aggregate
of 44.67 million customers as of end of June 2007 spanning mobile, fixedline, broadband and enterprise services. Bharti Airtel was recently rankedamongst the best performing companies in the world in the BusinessWeekIT 100 list 2007. Bharti Teletech is the countrys largest manufacturer andexporter of telephone terminals. Bharti has a joint venture with ELRoHoldings India Ltd. FieldFresh Foods Pvt. Ltd - for global distribution
of fresh fruits and vegetables. Bharti also has a joint venture - Bharti AXALife Insurance Company Ltd. - with AXA, world leader in financialprotection and wealth management. Bharti has recently forayed into theretail business under a company called Bharti Retail Pvt. Ltd
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Cash and carry & wholesalestrategy
Wholesale cash-and-carry operations provide small retailers and businessowners a wide range of quality products at competitive wholesale prices thathelp them enhance their businesses and profitability. The Bharti Wal-Martbusiness-to-business (B2B) wholesale cash-and-carry joint venture willserve kirana stores, fruit and vegetable resellers, restaurants and other
business owners. It also will serve other retailers such as Bharti Retail,which is setting up a chain of stores in India that are 100 percent owned andoperated by Bharti.
The wholesale cash-and-carry venture will invest in setting up an efficientsupply chain. This will link farmers and small manufacturers directly toretailers, thereby maximizing value for farmers and manufacturers on the
one end and retailers, and in turn, consumers on the other. The venture willsupport farmers and small manufacturers who have limited infrastructureand distribution strength, and the supply chain will enable minimumwastage, particularly of fresh foods and vegetables.
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Cont.
sell a wide range of fruits and vegetables, groceries and staples,stationery, footwear, clothing, consumer durables and other generalmerchandise items.
Bharti Wal-Mart Private Limited will bring modern supply chainand back-end logistics expertise to India, bringing Wal-Marts globalbest practices in such areas as just-in-time inventory, retailinformation systems, cold chain infrastructure, GPS for truck andtrailer tracking, and fuel management systems.
It is our hope that big and small retailers and businesses will be ourcustomers, take advantage of the efficiencies we provide and derive
significant benefits for their businesses.
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Cont.
The equal joint venture, Bharti Wal-Mart Private Ltd., is for cash-and-carry, or wholesale, and back-end supply chain management
Bharti Wal-Mart will open 10 to 15 cash-and-carry facilities overseven years, employing about 5,000 people. A typical store wouldoccupy 50,000-100,000 square feet.
The first of the stores, which will sell groceries, consumer appliancesand fruits and vegetables to retailers and small businesses, is slatedto open in North India by 2009.
If thats the wholesale cash-and-carry business, Bharti plans to setup front end stores- like convenient stores, super markets and hypermarkets - in which it plans to invest about $2.5 billion. This will bewholly owned by Bharti, which will of course source expertise andtechnology from Wal-Mart. Once the rules permit FDI in front endmulti-brand stores, Wal-Mart is likely to be a part of the company.
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Opportunity in India
India's rapidly growing middle class has more money to spend than
any previous generation - but no place to spend it. Just 3% of retail
spending in the country is in what westerners would consider
"organized" retail stores
The Indian retail industry is expected to grow from $300 billion ayear today to $637 billion by 2015. The share of the overall retailmarket in India held by large retail stores is expected to grow in thenext five years to 18 percent, from 3 percent.
According to the research of (NCAER) published in Economic timesdated Aug.8th,08 the trend among the top 20 Cities for the income
per household will be doubled till 2016
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Thank you
A il 19 2006
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