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Walmart 1

Walmart's competitive advantage is sustainable due to its foundational cultural values. Key factors include selling products at low costs through economies of scale, forcing smaller retailers out of business to achieve everyday low pricing, negotiating low prices from vendors due to access to the large US market, owning distribution warehouses, and using IT systems to efficiently lower operational costs. While competitors try to imitate Walmart, fully duplicating its strategy is difficult due to the challenges of achieving the same operational efficiencies, differentiating on both cost and product, controlling labor costs and unions, and building the same level of customer trust and brand recognition.

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Abhinav Shankar
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104 views

Walmart 1

Walmart's competitive advantage is sustainable due to its foundational cultural values. Key factors include selling products at low costs through economies of scale, forcing smaller retailers out of business to achieve everyday low pricing, negotiating low prices from vendors due to access to the large US market, owning distribution warehouses, and using IT systems to efficiently lower operational costs. While competitors try to imitate Walmart, fully duplicating its strategy is difficult due to the challenges of achieving the same operational efficiencies, differentiating on both cost and product, controlling labor costs and unions, and building the same level of customer trust and brand recognition.

Uploaded by

Abhinav Shankar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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3)

The Competitive advantage of Walmart retailing is very sustainable because of the values being
foundation to the culture. The key factors of Competitive advantage are as follows:

 The strategy of selling products at low cost with high volumes brings profit at the same time
customer satisfaction as they can buy brand items at low cost. This strategy is achieved due to
the Economies of Scale.
 To achieve the "EDLP" goal, Wal-Mart store opens in the area, and smaller proprietary retail
businesses are often forced out of business. It improves the company's willingness to sell every
smaller store below the long-term average running expense. To retain its market reputation as
the biggest company in the nation, the long-term overall operational expense is even
smaller due to economies of scale.
 The power in buying from the vendors at low cost and they will provide as well because though
they might be supplying less quantity from the Walmart point of view but they will have access
to the US retail market and high revenues.
 They have their own distribution and warehouses. Mixes with the third parties for delivery of
very frequent in small amounts and together supply takes place.
 The factor is that most competitors will not imitate Wal-Mart quickly. Cross-docking has
contributed to reducing packaging, labor and operational costs through Wal-Mart. It is an
incredibly effective weapon to use IT and the state-of-the-art communication system, which will
ensure Wal-Mart that its sales and products over the US market, even to global operations,
consistently and easily decrease.

The main factor for limited success by imitating WM’s strategy and by duplicating competitive strategy
is:

 The efficiency in operations is very difficult achieve though if anyone has copied the strategies.
 Using Porters model, the differentiation strategy and in cost strategy is very difficult to impart in
the culture of any organization.
 The power in controlling the wages of labors and not allowing unions formation.
 It takes very long time to build the name in the customer as equal to Walmart brand and rivals
need extra strategies than Walmart to go to higher position in customer point of view though
strategies are copied.
 The imports which they are controlling decreases the cost. They have some unique benefits
which other companies finds harder to adapt.

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