Cost Leadership and Differentiation Strategies @Walmart
Submitted by: Samrat Basu
INDEX PAGE
Walmart Origin Page-3
Walmart Mission/Vision Page-4
Corporate Culture@ Walmart Page-4
Competitive Position of Walmart Page 5-6
Strategies @ Walmart Page 6-9
Private Label and Store Layout Page 9-11
Conclusion Page-11
Appendix Page 12
References and Bibliography Page 13-14
Wal-Mart- Origin
Wal-Mart was the product of Sam Walton, a businessman from Arkansas. In the late 1940s, in USA, a retailer who was successful in obtaining a sufficient discount for his products from the whole-seller, used to sell the products at full price to the customers and thus enjoyed a substantial amount of profit. Sam Walton during that time was working as a retailer at a J.C. Penney store in Des Moines, Iowa.(Walton & Huey, 1993) Incidentally while working there, he was introduced to Butler Brothers, a big retailer who had chains of variety stores known as Ben Franklin and Sam was offered a store in Arkansas. There Sam excelled in operating the stores and soon huge amount of sales were generated which far exceeded the expectations. But during the lease renewal of the store, there were some problems and as a result an agreement could not be reached. This drove Sam in opening a new Ben Franklin franchise in Bentonville, Arkansas and called it “Walton’s Five and Dime”. The prices of the goods were marked quite low than the competitors. Walton realized that instead of pocketing the extra money that was generated through retailing, he could better earn profit by volume and pass on the savings to his customers. Sam was a firm believer of the fact that his customers should be provided with what they want. In his autobiography, Sam said "The secret of successful retailing is to give your customers what they want. And really if you think about it from the point of view of the customer, you want everything: a wide assortment of quality merchandise; the lowest possible prices; guaranteed satisfaction; friendly, knowledgeable service; convenient hours; and a pleasant shopping experience. You love it when a store exceeds your expectations, and you hate it when a store inconveniences you, gives you a hard time, or pretends you're invisible."(Walmart, 2010)
Source: www.walmartstores.com
Walmart’s Mission/Vision Statement
Sam Walton initially started his career in the retail trade for a Chicago-based retail store. While working there he felt that the retail industry had a lot of opportunities and that the disposable incomes of the people in USA were on the rise. So he had developed this idea of giving the people a retail store with some differences from the “J.C. Pennies” of the time. He had a simple idea of starting a discount retail store which would provide discount margins and would be similar to a wholesale price and it would also offer a friendly and an easy shopping experience with a friendly service. The USP of the stores would be that it would be located in the small towns as he believed “there was a lot more business in those towns than people ever thought”. (Murphy, 2010)
The Mission Statement of Walmart and its advertising slogan when it first started were the same:
“We save people money so that they can live better.”
Apart from the mission statement, the company has a statement of purpose for their stakeholder that is the
