Business Analysis of Wal-Mart - Research Paper Example

Currently, Wal-Mart has about 4,573 stores worldwide along with 730,000 associates that are evident in the form of their presence in fourteen countries (Vatalyst, 2012). In Canada, Brazil, Argentina and United Kingdom, Wal-Mart has wholly owned operations while it has several joint ventures in China along with some majority owned subsidiaries. In many international stores, Wal-Mart operates under various banners with one aim that is to provide best quality products at low prices so that customers can save money and live a better life as well.

The primary idea behind the establishment of Wal-Mart was to provide high quality branded products at low prices. In order to have low prices, the company ensures that the cost is kept to a minimum level with the help of excellence in warehousing as it has developed cordial relations with its suppliers and advancements in information technology have helped the store to ensure that inventory level is properly maintained (Piercy, Cravens & Lane, 2010). Economic trends influencing business Wal-Mart has been severely impacted by economic recession and increase in costs of transportation and utilities.

The second quarter forecast of corporation reported that the share prices are lower and profits also reduced considerably as compared to first quarter profits (Cheng, 2012). Lately, shares of Wal-Mart went down to $56.74 which meant it reduced by 2.2%. Other costs that have impacted Wal-Mart’s sales are increase in commodities and fuel cost; as a result product placement and transportation became one of the major areas of concern for the store. The number of economic worries for consumers has increased significantly i.e. from gasoline prices that have reached highest prices to housing and credit markets that have declined radically.

Such economic downturns have affected the spending power of budget conscious consumers who prefer to shop from Wal-Mart rather than do bargaining for their shopping. Since economic recession has impacted lives of USA consumers’, they are now shifting to Wal-Mart for shopping at low prices (Cheng, 2009). In order to cut down its cost, Wal-Mart has controlled its promotional activities as it needs to maintain certain profit level so that it can survive in such financial distressful situations.

Wal-Mart still uses its tagline “Save Money. Live Better” and in order to reinforce this image it has expanded into generic drug prescription program. Currently, store is offering 90 days supplies of about 350 medications for $10 and also $4 over-the-counter drugs so it can expand its sales of pharmaceutical products and even bolster its store traffic. Strategies and Tactics used by Wal-Mart for addressing the changes Since Wal-Mart wants to reach more customers and observing that industries are getting global, Wal-Mart launched its website in 2010.

It consolidated all its E-commerce activities worldwide into one Global E-commerce Division (Parker, 2012). The primary objectives of this Division comprise of developing and executing a global strategy for E-commerce; provide acceleration for global growth of online channel and creation of technological platforms and applications for every market of Wal-Mart. In order to address the global changes that are taking place, Wal-Mart has revised its business strategies to incorporate these alterations in the market and ensure that they are aligned with organization’s main goal of providing superior quality products at low prices.