Critical Examination of the Applicability of Module Topics to Wal-Mart and DHL - Essay Example

CRITICAL EXAMINATION OF THE APPLICABILITY OF MODULE TOPICS TO WAL-MART AND DHL By Wal-Mart The Wal-Mart is undoubtedly one the largest retail stores in the world with numerous stores spread all over the world. Wal-Mart Inc. has maintained its profitability for so long through the implementation of a low-price strategy that has seemed to resonate well with its clients. The company has employed a low-price strategy by offering quality products at a low price a technique that has seen it maintain a high level of customer loyalty since the clients are more than willing to shop with Wal-Mart since they are assured of quality goods at a low price. In the company’s strategic plans it was evident that there are numerous retail chains in the market thus it had to come up with a strategy that would ensure it stands out of the rest and, in the long run, maintain a competitive advantage over its rivals (“Strategies for Reaching”, 2010). Despite offering its goods at low prices, the quality of goods sold to clients is not compromised, even though; profit maximization remains the principal objective of the organization. It is literally difficult for an organization to achieve all these three parameters at a go, but Wal-Mart has managed to conquer them all through strategic planning and implementation. The company conducted its analysis of the industry and came to the conclusion that the value of retail goods increased exponentially from the time of manufacturing for the time they get to their stores. Thus, they came up with a rapid transportation system that supplied its stores with goods from the suppliers in time, and only the required products were reimbursed in the stores (“Wal-Mart: Key”, 2014). The company developed an integrated inventory system that was coordinated with their primary suppliers for instance Proctor and Gamble whereby goods would be replenished in the stores immediately their volumes run below the recommended levels. In that sense there would be no time a good would be missing in Wal-Mart stores since the system would update the suppliers of the goods that were on demand and the rapid transport system of Wal-Mart would dispatch them to the respective stores within twenty-four hours. The fact that Wal-Mart deals directly with its suppliers ensure that the cost of essential goods is significantly discounted and those price cuts are transferred to customers in terms of low prices (Govindarajan, and Gupta, 2002). The company is notable with its low prices a feature that has seen it accrue billions of dollars yearly in terms of revenues and made other market players to shut business since they would no longer compete with the low prices offered by Wal-Mart. The same model of business that the organization implements in America is applied in overseas stores of Wal-Mart. However, the issue of prices tends to fluctuate depending on the geographical location of the stores since when transport is factored out it tends to raise the expenses that in turn will impact on the final price of goods. Despite that the prices that Wal-Mart offers globally are relatively lower than those of their market competitors (Govindarajan, and Gupta, 2002). The primary mode of transportation that Wal-Mart employs in all its suppliers is road transport. The company owns a fleet of trucks together with a team of dedicated driver who are technically trained to minimize their mileage on the roads by utilizing the shortest routes possible to ensure the goods reach consumers at the appropriate time. The fact that the firms goes for goods from the suppliers minimizes the effects of middlemen and brokers who make the supply chain long thus saving on both time and cost to get the products delivered within the expected time frame and at a significantly reduced price an element that has granted the firm a market edge in the industry. Through such operations the company achieves its objectives of providing its consumers quality goods at a reduced price at the same time ensuring it maintains sustainability by reducing the carbon path for its fleet of trucks with the utilization of shorter routes (“Strategies for Reaching”, 2010). DHL DHL is a courier service global firm that has operations in nearly one hundred countries across the world. The company has maintained reliability and convenience over time thus making it stand out from close rivals such as FedEx and the rest. Courier services are primarily founded on the premise of flexibility, reliability, and convenience. The company is expected to deliver the goods within the agreed time frame, the goods should be in good condition while the customers should be assured that their parcels are safe and will arrive safely to their respective destination. DHL has implemented on credibility as an operational strategy that ensures its clients that their goods will safely come in their original form without any type of alteration. Most of the goods that are sent via courier services are either valuable or urgently required in the particular destinations. Thus, irrespective the cost of the service clients will be willing to pay any amount as long as they are assured that their parcels will actually arrive at their destination in the right form. By emphasizing on security and credibility of their services DHL was able to position itself as a premier courier service provider in Europe and trans-Saharan Africa (“DHL Reports”, 2014). Urgency is a primary factor in this kind of industry; thus DHL makes sure that the shortest time possible is spent to ferry the various parcels that it receives to various destinations across the world. The company has developed an elaborate transportation system that comprises all means of transport namely road, air and water to ensure coordination of the various avenues to realize a fast and reliable system (Berman, 2014). Global trade operations are achieved through a close coordination of air transport whereby the company has chartered airplanes that are specifically meant to ferry its parcels to various destination thus guaranteeing clients quality, reliability and speed all at the same time. The organization maintains control over its channels of supply by conducting all logistical operations in-house without outsourcing any activity to maintain the credibility of their services at the same time enhance service delivery (Berman, 2014). The chain of supply is a core competency of the firm, thus it has maintained total control of all its supplies to avoid the strategies that the company employs being copied by competitors thus ensuring DHL fully leverages from its competitive advantage. The global strategy of the firm remains to be committed to the security and reliability of the services that it offers to its clients. Regardless of the location of the company’s outlets similar level of services are provided. The experience that a customer receives by sending a parcel from Naivasha in Kenya to Garissa is the same one a client in Berlin receives by sending his/her parcels to Munich (“International Supply”, 2015). References Wal-Mart: Key Success To Supply Chain Management. (2014). Available at: http://www.usanfranonline.com/resources/supply-chain-management/walmart-keys to-successful-supply-chain-management/#.VTXxn-E7duU [Accessed on 21 Apr. 15]. Govindarajan, V., and Gupta, A.K., 2002. Taking Wal-Mart Global: Lessons from Retailings Giant. (2002). Available at: http://www.strategy-business.com/article/13866?pg=all [Accessed on 21 Apr. 15]. Strategies for Reaching Global Markets. Available at: https://sites.google.com/a/email.vccs.edu/walmart-by-samantha-hagley/stategies-for-reaching-global-markets [Accessed on 21 Apr. 15]. International Supply Chain Management. (2015). Available at: http://www.dhl.com/en/logistics/industry_sector_solutions/automotive_logistics/international_supply_chain_management.html#.VTXzFeE7duU [Accessed on 21 Apr. 15]. Berman, J., 2014. DHL Global Forwarding Takes Steps To Secure Additional And Long-Term Capacity For Customers. Available at: http://www.supplychain247.com/article/dhl_global_forwarding_takes_steps_to_secure_additional_and_long_term_capaci/dhl_global_forwarding [Accessed on 21 Apr. 15]. DHL Reports Expected Growth in International Supply Chain and Customs services. (2014). 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