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Walmart is a huge, massively successful corporation that can serve as a useful case study for anyone who wants to build a successful business. There are a variety of factors that have impacted Walmart's success. In order to properly understand this success, it is useful to perform a competitive analysis that looks at the firm's strengths, weaknesses, opportunities and threats.
Strengths
Walmart's key strength is that it is a cost leader. A cost leader is a firm that can provide goods to the public at the lowest possible prices. Walmart is able to achieve this by using its large buying power to negotiate deals with manufacturers and by sourcing many of its products from low-cost countries like China.
Weaknesses
Walmart's weakness is that it is a very broad company. Walmart stores offer a range of products that encompasses everything from produce to hunting equipment and services that range from pharmacies to photography. Because Walmart is broadly focused, it is difficult for the company to excel at any one particular area.
Opportunities
Although Walmart is huge in many markets, there are also several large markets that it has not yet entered. Continental Europe and many regions of Asia are areas where Walmart can potentially expand its business. There is also room for Walmart to expand and develop larger stores in the markets where it is currently doing business.
Threats
Walmart has managed to dominate the discount department store industry. Its real competition may come from more focused businesses, however. Businesses that focus on a single area such as groceries, automotive services or clothing may be better able to satisfy customers than Walmart is able to with their broad focus.
References
- University of Saint Francis; SWOT Analysis; Anthony C. Danca
- Marketing Teacher.com: Wal-Mart SWOT
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- U.S. Department of Labor. "U.S. Department of Labor Recovers $4.83 Million in Back Wages, Damages for More than 4,500 Wal-Mart Workers." Accessed March 30, 2020.
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- Bryan Roberts and Natalie Berg. "Walmart: Key Insights and Practical Lessons from the World's Largest Retailer," Page 89. Kogan Page Publishers, 2012.
- Business Insider. "Target's Groceries are Shockingly More Expensive than Walmart's — and it Highlights a Huge Challenge for the Business." Accessed March 30, 2020.
- Charles Fishman. "The Wal-Mart Effect," Page 17. Penguin, 2006.
- Andrew R. Thomas and Timothy J. Wilkinson. "The Customer Trap: How to Avoid Big Mistakes in Business,"Pages 66-67. Apress, 2015.
Writer Bio
Wendel Clark began writing in 2006, with work published in academic journals such as "Babel" and "The Podium." He has worked in the field of management and is completing his master's degree in strategic management.