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Wal-Mart Stores is a publicly traded company with segments in USA. International company segments consist of company's operations out of the US that includes a number of retail outlets. A segment of the company, the Sam's Club operates nearly in all supercenters, discount stores, and in the neighborhood markets on a 24 hours basis. The Sam’s Club deals with assorted product lines like electronics, jewelry, and hardware among others. Wal-Mart stores offer products that are similar including the following: beauty and health products, household appliances, women’s, men’s, and children’s apparel, etc. Today the company runs over 10,000 retail outlets under different banners in 27 countries. Wal-Mart has over 2 million hard working employees, who are serving close to 200 million clients and customers every week (Walmart, 2012).
Wal-Mart’s Mission and Vision Statements against Its Performance and How the Company Lives out Its Mission and Vision Statement
Wal-Mart is one of the most successful business companies worldwide. Wal-Mart’s success is attributable to its vision statement that concerns globalization. According to Ireland & Hoskisson (2012), a vision statement is referred to a statement used in describing an organization by pointing out organization’s expectations in the future. A vision statement thus focuses on implementing decisions and strategies to pave for business’s future (Ireland & Hoskisson, 2012).Wal-Mart Company operates globally in line with its major vision of stretching its operations globally. The other vision is to promote ethical culture ownership to all stakeholders worldwide. Wal-Mart’s idea in its vision regarding ethical culture is the lead to globalization. The company has enjoyed competitive advantage and positive reputation owing to its ability to embrace diversity and culture in all its operations across different nations (Walmart, 2012). By promoting ethical culture, Wal-Mart assists its stakeholders and customers to make informed decisions by doing the right thing. This has made the organization to become successful. The corporation has outlined guidelines to assist its associates to maintain this vision by adhering to all laws, fairness in operations, integrity, respect for others, and accommodating diversity (Casadesus-Masanell & Tarzijan, 2012).
Wal-Mart Stores Mission Statement
Mission is the reflection of an organization in terms of the type of services or products an organization produces, which holds certain value to its consumers (Hill & Jones, 2007). Wal-Mart's mission statement is "enabling people make savings and live better". Based on organization’s beliefs and core values, its mission focuses on the provision of exceptional services at "everyday low prices" to its customers. Wal-Mart has sustained its business operations for a long period within the retail industry. This is attributable to top-level executives and management teams, who work hard to implement strategies based on company’s mission. The company has a major belief in increasing profits through charging less to increase volumes of sales rather than charging high prices for their goods (Walmart, 2012). This strategy provides management with foundations for effective decision-making and their implementation. Missions and visions have improved organization’s performance by making the quality of health care to be more accessible and affordable, reducing costs of energy for their customers and sourcing for markets around the world.
Assessment of Wal-Mart’s Strategic Goals Link to Its Mission and Vision
A strategic goal is the one that determines company’s direction in the long-run (Hill & Jones, 2007). Wal-Mart has laid strategic goals in different aspects as explained further.
Global E-Commerce Wins
This goal aims at serving customers in the globe in the future. The company operates its businesses online successfully. Currently, it has introduced e–commerce businesses in Brazil and Canada that are now rapidly growing. Based on its mission to provide better and cheaper brands in its 10,000 stores to millions of customers, the company will use its assets to create and deliver a multi-channel experience worldwide to all its clients. The company has set up a media channel @Wal-Mart Labs by using powerful talent in mobile and social media. Through this, investments and additional opportunities will result due to e-commerce, whereby products will reach their customers at low prices making their lives better like in the mission statement (Walmart, 2012).
Reinvigorating a “Customer–Focused” Culture
The customer is the goal number 1 in the Wal-Mart culture. This strategic goal aims at putting much effort into comprehending customers and then serving them well. Company's worldwide Customer Insights group develops world-class analysis while looking for trends amongst customer, which will support marketing and merchandising decision-making within the businesses. This strategy will ensure that the company gets even closer to its customers. The proposed way of doing this is conducting home visits by the management. By getting closer to customers, the company will reach out to global customers where they have extended their markets. Through this, they will be able to engage customers in dialogue, listen to them, and understand their needs. Gaining such insights about customers’ needs will lay Wal-Mart stores next generation’s groundwork.
Steering the Productivity Loop
Delivery of low-priced products every day is premised on the mission of making the lives of customers better by everyday low costs. Productivity loop is undoubtedly Wal-Mart's strategic goals and has leveraged operating expenses of the company for the past two years. The company operates and sells for less, thus increasing its sales volume. The company remains committed to reduction of operating expenses by several points in a period of 5 years. Wal-Mart focuses on maintaining productivity in the most efficient ways possible. Wal-Mart expects to steer full global advantage in areas such as sourcing, information systems, shared services, and business processes. Company’s price leadership commitment (through its mission) has initiated its quest to investing in price about 2 billion dollars through reduction in expenses and improving productivity over the next years (Franklin, 2001).
Analysis of Wal-Mart’s Financial Performance In Relation To Its Strategic Goals and Strategy
Strategy in business refers to a plan of action directed to attainment of a certain objective (Bungay, 2011). Wal-Mart Company in the USA has achieved positive store sales for the fiscal year 2012. The company has recorded increased customer traffic in the fourth quarter. Net sales went over 264 billion dollars, marking a 1.5 % increase, while the operating income rose to 20.4 billion dollars, representing a 2.2 % rise compared to the previous year. This improved performance was arrived at due to efficient operations and alignment of company’s strategy with the needs of its customers. Expansive assortment of improvement in-stock levels together with lowered prices in its mission resulted in a strong leadership and associates services going along to resonating with customer needs. Offering broad good’s assortment has enabled customers to appreciate Wal-Mart as a convenient one-stop shopping experience. Adding more than 10,000 products in hundreds of categories of merchandise and coming up with new innovative products have been important aspects of a strategy of increasing sales. The company works with suppliers to offer innovative products and then mixes national brands with private brands to capture markets in all cultures (Warlmart, 2012). This strategy resonates with its vision of diversifying culture hence paving way to globalization. This strategy and vision have increased company’s profits, which is evident from its performance in the last fiscal year. The facility has improved its in stock amounts to ensure customer's rely to the organization at all times (Franklin, 2001).
Delivery of Everyday Low Prices as reinvigorated in Wal-Mart’s fundamental promise has ensured everyday provision of company's varied assortments at low prices. Price message as catered by the mission coupled with effective strategies has ensured that price separation is drawn between than that of company's competitors. Great values certainty in Wal-Mart stores is fundamental for its excellence in performance for a long period. Early this year, the company started a 2 billion dollar investment for the coming two years. This was funded by productivity initiatives and expense reductions aimed to lower prices for their customers even further. The company continues investing in expansion through different channels like Wal-Mart Express, e-commerce, and Neighborhood Market that have increased sales while providing Wal-Mart customers with shopping alternatives.
Competitive and Marketing Analyses of Wal-Mart to Determine Its Strengths and Opportunities
There are different factors that influence Wal-Mart's success. An analysis of its market shows that the company focuses on massive merchandising rather than specializing on merchandise. Mass merchandising enables Wla-Mart to offer convenient services and products from a convenient store, which help customers manage their time better. Variety of locations for mass merchandising ensures their services and products in every location are demographic-based. Discount stores, superstores, and neighborhood markets form these three types of stores. For proper comprehension of Wal-Mart’s success, it is essential to carry out competitive analysis that will look at firm's strengths and opportunities (Simoneaux & Stroud, 2011).
Strengths of Wal-Mart
Wal-Mart’s strength is the fact that it has a strong retail brand. It has a reputation of providing high value for money, wide range of products, and convenience of its stores is widely known. Wal-Mart has also substantially grown in the recent years. It has also experienced expansion in its global market, for example, a purchase of a retail outlet based in the United Kingdom by the company. Another competitive aspect of the company is its core competence that involves using information technology in support of its system of international logistics. This for example, is seen in the way its individual products perform in the countries it covers. Information technology also supports company’s efficient procurement. The company has also focused on management and development in the human resource (Franklin, 2001). Employees are Wal-Mart's business core, and the company invests in money and time by training, then retaining, and developing them.
Opportunities of Wal-Mart
These opportunities are chances it has for taking over, forming mergers, or forming strategic alliances with different global retailers that will focus on various markets in Europe and China region. Company’s stores are found in relatively small number of nations. There are, therefore, tremendous opportunities and chances for expansion of future businesses to expand the markets for consumers in countries like India and China. New types of stores and locations provide Wal-Mart with opportunities for exploitation of market development. Opportunities exist for the company to progress with its current strategy of opening large convenient centers (Simoneaux & Stroud, 2011).
Strategy that will Maximize Wal-Mart’s Return to Shareholders
Low cost is Wal-Mart's profit maximization strategy to return to shareholders. Their pricing strategy is based on the idea that selling more units at a lowered price will lead to greater profits as opposed to if they charged higher prices for the same commodities. The strategy worked because other retailing stores marked up their goods to a high of 200%. However, Wal-Mart only marked their prices to 30 % on average. Consumer’s response to Wal-Mart was positive. Company’s price message supported by a strong ad match policy within the industry ensured that price separation was achieved at the expense of their competitors. The rationale for choosing this strategy is historically based on the revenue rise from nearly 3% to 103.7 billion dollars. At Wal-Mart's namesake stores, measures went down during the US recession by 1.8 percent, whereas in their segment Sam's Clubs this measure rose by 1%. This measure, which came at the time when many businesses were grappling with harsh economic effects, is an indicator of company’s financial health. Shares in fact rose from 39 cents to 50.80 dollars in the premarket trading. Market analysts were expecting earnings of 96 cents per share in earnings of the 105.3 billion. With continued focus on growth and low pricing of goods, Wal-Mart has retained most of its customers following the economic recession, which has affected US economy in recent years. The expected outcome by Wal-Mart in this case is earning between 3.95 and 4.05 dollars per share for its shareholders this year. This will be higher than its last figure ranging between 3.90 to 4 dollars (Jamison, 2011).