|
|
This is only a preview of the paper
Click here to register and get the full text.
Existing members click here to login
|
|
|
There are some external factors assisting in creating competitive advantage for Wal*Mart in the discount retailing industry. These external factors create opportunities for Wal*Mart profitability. However, sustaining such competitive advantage is a result of Wal*Mart ability to deploy its internal resources and capabilities. At the beginning we will discuss what are the sources for Wal*Mart competitive advantage?
Despite the unattractive, high threat, and low opportunities of the industry that Wal*Mart operates in, Wal*Mart could have a return on sales and net sale of 3. ... This would be a result of the cost leader strategy Wal*Mart is following. ... From the analysis of the industry we found that the net profit margin of Wal*Mart for the past 12 month in 1993 was 24. ... So, how Wal*Mart is successfully lowering its cost compared to its competitors? ... Wal*Mart does not think of lowering the prices at the end value chain- its consumers –through pricing lower than competitors – this could lead to a loss in the long run – but they usually cut cost at every transaction of the retail process. First, through its vendor relationship, Wal*Mart installed the EDI with its 3,600 vendors that on the long run reduced the inventory costs and increased sales; decreasing cost to vendors decreased cost to Wal*Mart eventually. ... As well how Wal*Mart transformed the relation with vendors from supplier – customer relation to a partnership relation. ...
Second, how Wal*Mart chooses their store locations? The lower renting expenses of 3% for Wal*Mart while 3. ...
Third, Wal*Mart is minimizing its input costs through locational differences in input prices through pricing its products to meet local market condition.
Approximate Word count = 1375
Approximate Pages = 5.5
(250 words per page double spaced)
|
|
|
|
|
|