What is Business Strategy | Walmart Case Study | Walmart Business Model | How Kmart Failed?
Channel: Zeeshan Zahid
Date: 2020-04-17

What is Business Strategy | Walmart Case Study | Zeeshan Zahid

Some HISTORY on Kmart and Walmart...

• 1981 Kmart opens its 2,000th store
• 1982 Sam Walton becomes the wealthiest man in America
• 1990 Walmart overtakes Kmart in sales
• 1995 over 200 Kmart close
• 2002 Walmart becomes America's largest corporation on the Fortune 500 list, with revenues of US$219.8 billion and profits of US$6.7 billion.
• Kmart declares bankruptcy the same year!

Definition of Strategy.
A strategy is identifying your competitive advantage and focusing all your energy and resources on one, or very few objectives which will lead to positive outcomes.

Walmart Business Model...
1. Walmart focused its efforts on serving small towns where it faced small local retailers as competitors.
2. Walmart could be the “one-stop solution” for consumers, bringing impressive convenience to locals.
3. Everyday low prices” crushed the local competition.
4. Competing against local, small retailers would help Walmart achieve higher margins vs competing in metropolitan area battlefields.

Walmart Business Strategy.
o Walmart invested heavily in computer data and logistics.
o It created a very efficient network of just-in-time deliveries to fulfill their stores.
o The centralized inventory in strategically-located distribution centers that fed a network of up to 150 stores.
o This centralized inventory network served millions of people with fantastic purchasing power and unbeatable efficiency.

Individual stores had virtually no negotiating power. Walmart’s strategic strength was the network, not the store!

Conclusion! 

New technologies change the rules of the game!
Networks, barcodes, logistics, data analysis, to name a few, made possible Walmart’s innovative business model.
The strategy is a critical component in this world and a good strategy changes everything!

What about you? Have you invested time thinking about it?

By the way … Remember this: GOALs are NOT strategies!
Stay Safe & Stay Blessed