Case Briefing

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Problem statement

In the year 2011 wal-mart suffered a consecutive decline in same-stores sales, the problem being that the company was operating a variety of stores under a different banner. Hence, some competitors like the Dollar general were rolling small format stores that were eating into wal-mart shares as well as Amazon.com being a threat in the online space.

Situation analysis

A critical analysis of the United State retail sales it is clear that the countries retailers compete at regional and at national levels as well as some retailers have strong supply chains and compete at the international level, for example, wal-mart and Costco. Most of the retailers compete for human resource, location and customers the retailers commonly use two types of global retailing strategies which are variable pricing and Everyday low price (EDLP). The variable pricing has been practiced by retailers for a long time, this strategy involves adjusting prices of items to optimize the gross margins, for example, the retailers keep consistently low prices on items like milk and sugar but increase price in items like toothpaste and detergents. The second strategy is that of EDLP this strategy means that the prices of goods are usually consistency from week to week. However, the prices are kept as low as possible. The main objective of this strategy is to generate a higher aggregative profit by increasing the value of goods sold.

The wal-mart strategy was to give it customers a wide assortment of quality goods and services using the EDLP strategy this has made it the best-known store in giving a discount. It offers goods like apparel, houseware, hardware and even electronics. In the United States, merchandise field wal-mart was facing a lot of competition. The main membership competitor was Costco wholesale as well as faced competition for general merchandise product and some online competition from Amazon.com. Though wal-mart has a widely published and faced competition  it had adapted a good management method thus making it continue leading in industry, achieving 11.5 times in the year 2011, however, Kroper company which is the second largest retailer in the United States had its inventory turns of 14.2 times which is 2.7 higher than that of wal-mart. The reason being that Kroper Company focused on turning perishable foods

Recommendation

Wal-mart should join a union. This will make it have a good environment where they treat their employees as well as not facing bad publicity campaigns from its competitors like the united food commercial workers who always advertise against it. Joining a union will also help wal-mart to avoid unions that fund grass root group whose aim is to undermine wal-mart expansion and this is because the union will help wal-mart to advertise itself and improve their sales without facing any difficulties from those companies who are joined in the union.