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SWOT Analysis of Wal-Mart

Wal-Mart Stores, Inc. was established by Sam Walton at Rogers in 1962. This business has encountered immense growth after achieving an annual income of one billion dollars in seventeen years (Ellickson, 2016). This tremendous growth has made the store enter the global market. Wal-Mart has launched stores in various countries, counting Britain and Canada. About one hundred million customers are believed to visit the Wal-Mart store set up anywhere in the globe through its global expansion. The stores employ about 1.4 million associates globally and are positioned in stores within and outside the United States (Courtemanche et al., 2019). Wal-Mart’s style of management has confirmed effectiveness, bringing about unprecedented business achievement. Using Wall-Mart as an example, it is possible to evaluate how the business can use the strengths to obtain a competitive advantage in the current competitive environment. This paper looks into the company’s strengths, weaknesses, opportunities, and threats the business encounters.

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Wal-Mart Stores are characterized by various strengths, including diversity, leadership strategies, products and services, technology, and global operations. The business can utilize these strengths to obtain a competitive advantage in the current competitive environment. Wal-Mart also has weaknesses, mainly regarding its span of control (Courtemanche et al., 2019). Because of its vast operation scope, this business cannot efficiently monitor issues such as labor lawsuits, little differentiation, negative publicity, and increased employee turnover. On the other hand, Wal-Mart has ample opportunities within the global market by growth in online shopping and opening more stores in various countries. Regardless of its vast size, the company also encounters resistance from diverse local communities, ruined public image, and competition in different new markets it ventures, creating threats to its operation.

One of the significant strengths of Wal-Mart is the ability to utilize Information Technology (IT) to obtain a competitive advantage. However, technology is changing quickly, with new developments rising nearly on an everyday basis. The store needs to keep up with the modernization rate regarding the most recent technology to advance the business process’s efficiency. This will improve the procurement system and aid in monitoring the various interests within the global market. Regardless of its international existence, Wal-Mart cannot expand its business beyond some countries it functions in. the store should not fall back due to the political and economic instability experienced now. Environmental policies are crucial to reducing global warming, and Walmart as a company has a significant role to play. A company with such enormous resources and a global presence must be leading in this operation (Tan et al., 2018). With millions of customers, Wal-Mart has an opportunity to assist in creating awareness in these environmental campaigns.

The measures presently in position are admirable but not adequate. Wal-Mart declares that it intends to attain its environmental objectives in the next three decades. With its vast resources, the company might achieve this within a brief period. If extra resources are dedicated to this course, bearing in mind the company’s annual income, these goals might be attained quicker. The current situation of Wal-Mart in its business features is desirable for the competitors. Though the past achievement does not assure the next achievement, Wal-Mart has to maintain the first position. It has vast strengths and great opportunities, and the weaknesses and threats factors are challenging although not overwhelming. The weaknesses and threats need attention and might be dealt with by efficient management.

SWOT Chart

Strengths Weaknesses
  • Diversity
  • Leadership strategies
  • Products and services
  • Technology
  • Global operations
  • Customer loyalty
  • Strategically located
  • Great pricing
  • Labor lawsuits
  • Little differentiation
  • Negative publicity
  • High rates of employee turnover
  • Large inventory to deal with
  • Poor employee management
  • Low-quality products
  • Poor ratings on review websites
Opportunities Threats
  • The rising recognition of individual label products
  • Trends toward healthy eating
  • Growth in online shopping
  • Retail market expansion in rising markets
  • Promotes a green ecosystem
  • Expansion to other countries
  • Target niche markets within communities
  • Develop products for the target market
  • Resistance from various local communities
  • Increasing competition
  • High commodity prices
  • Ruined brand image
  • Current economy
  • Change in market trends
  • Legal and political threats
  • Low adaptability to change due to the vast nature of the business

References

Courtemanche, C., Carden, A., Zhou, X., & Ndirangu, M. (2019). Do Walmart supercenters improve food security? Applied Economic Perspectives and Policy, 41(2), 177-198.

Ellickson P.B. (2016). The evolution of the supermarket industry: From A & P to Walmart. Edward Elgar Publishing. In Handbook on the Economics of Retailing and Distribution.

Tan, B., Yan, J., Chen, S., & Liu, X. (2018). The impact of blockchain on food supply chain: The case of Walmart. In International Conference on Smart Blockchain (pp. 167-177). Springer, Cham.

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