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Case Study - Essay Example

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Now, nearly two decades after his death, the company has taken on the world-wide retail market. Yet Wal-Mart still uses the same strategy that Walton used in Arkansas when he started building his…
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Case Study

Download file to see previous pages... Integrating with another company allowed Wal-Mart to gain retail facilities and employees quickly, which saved time and prevented lost profit. Additionally, it eliminated competition by doing business first with its competitors. This brought Wal-Mart time to gain excellent position in the market while avoiding tough competition with established retailers, which could result in huge losses for the “newcomer.” Once Wal-Mart opens its own stores, it employs its classic “pile ‘em high, sell ‘em cheap” strategy, which has a universal appeal to consumers. This strategy worked best at times of recession and in emerging markets since it is when and where buyers want to make the most out of their money.
Because of its extensive reach and strong customer patronage, Wal-Mart virtually controls what goes into the households in the areas it dominates. Fears that Wal-Mart is becoming “too powerful” have been roared by activists and sufficiently echoed by the media. Many companies, producers, and buyers are afraid that Wal-Mart will soon be monopolizing the global retail market. Hence, activists and the media, backed by producers and retailers, are strengthening their opposition to Wal-Mart. Also, some retailers in Mexico, who were previously competitors, have begun collaborating to match the giant retailer. Yet the greatest challenge for Wal-Mart is the possibility that consumers may share the fears for a “too powerful” retailer. This fear could easily spread as many shops have already shut down as a result of Wal-Mart’s presence.
In 2001, Wal-Mart earned more than three times that of its strongest competitor. However, the figures are not indicative of global performance since much of its revenue comes from North America. Considering its U.S. performance, it has fared badly internationally, particularly in countries which are drastically different ...Download file to see next pagesRead More
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