Walmart Inc.

Company Analysis

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Walmart Inc.: Introduction

Walmart Inc. gives access to its various service products and retail and online purchasing

options. The business provides a range of goods and services at regular, affordable pricing

(EDLP). The company is divided into three segments: Sam’s Club, Walmart U.S., and Walmart

International (Расулова, 2021). The Walmart U.S. sector is a consumer goods merchant that

operates in the United States under the Walmart and Walmart Neighbourhood Market brands and

walmart.com and other e-commerce brands. Retail and wholesale are the two segments that

make up the Walmart International sector. These categories include a variety of store types such

as supercenters, supermarkets, hypermarkets, warehouse clubs (like Sam’s Clubs), cash & carry,

as well as online shopping via websites like flipkart.com, walmart.com.mx, and others

(Расулова, 2021). The Sam’s Club section runs samsclub.com and is a membership-only

warehouse club.

The Company’s Story

The firm was established in 1945 when Sam M. Walton opened a Newport, Arkansas-

based “Ben Franklin variety shop” franchise. The start of the founders’ businesses occurred at

this time. However, in 1946, his brother (James L. Walton) founded a similar firm in Versailles,

Missouri. The company started small and rapidly expanded until it debuted its first supercenter in

1988 (Расулова, 2021). The firm took a different approach by entering the worldwide market in

1991 when it formed a joint venture in Mexico with IAS 31 thanks to its clear vision and

objective (Расулова, 2021). Consequently, in January of this year, the organization is doing

business in 23 nations. The American retail firm runs a network of grocery shops, cheap

department stores, and hypermarkets (Courtemanche et al., 2019). One of the biggest retailers in

the world, it operates both an online shop and a network of physical locations. The retail giant
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was incorporated on October 31, 1969, and has its main office in Bentonville, Arkansas.

Walmart operated 11,484 shops and clubs under 56 distinct names as of January 31, 2020,

throughout 27 countries (Courtemanche et al., 2019).

Walmart is the world’s most enormous corporation by sales, with US$572.754 billion,

according to the 2022 Fortune 500 list. With 2.3 million workers, it is also the biggest private

employer in the world. In 1970, Walmart became public, and in 1972, it started trading on the

New York Stock Exchange (NYSE: WMT). Its share price in its first public offering was $16.50.

The company’s market valuation was $361.969 billion as of August 2022, and share prices

ranged from $117.27 to $160.77 during the previous 52 weeks. Walmart has rivals despite being

an enormous corporation in the world. This Walmart competition study delves further into some

of its biggest rivals’ tactics, numbers, and competitive advantages.

This business was created to provide Americans access to affordable goods. The

company has a long history of offering inexpensive goods. The firm has expanded worldwide,

with amazon and other multinational corporations serving as its primary rivals. The development

and progress produced the opening of shops in several states and other nations throughout the

globe. Walmart’s key marketing tactic of offering discounted rates for its retail goods has

increased the number of people it attracts (Pingolia, 2020). Walmart has been able to stay in the

market and improve its position over time because of its vision and pre-existing marketing plan.

The organization’s expansion is anticipated to improve in the following years due to its

continuing consumer loyalty and vital customer service. A crucial strategic strategy that allowed

the corporation to expand outside of its current borders was credited with the company’s success

(Walton n.d). By developing Walmart.com and SamsClub.com in 2000, the corporation launched

an e-commerce platform to access the internet market. After completion, the initiative was
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started in 2007 to capitalize on the already-existing establishments by enabling consumers to

place orders for products and services via an online platform (Walton n.d). The firm has been

able to expand its services and products, incubate companies that are digitally native, and make

use of technology thanks to the investments.

Despite criticisms that it is one of the worst employers, Walmart is one of the major

employers in the United States and various other nations. Walmart has persisted in giving many

people work in whatever area where it is located (Chang and Hu, 2020). The workers’ poor pay

has been a significant problem. Despite this, the retail establishment has consistently been able to

help the underprivileged and provide customers with low-cost items. Because of this, the poverty

rate in the United States has decreased by two-thirds, and low-income individuals can now buy

necessities. By making sure they expand into more and more nations throughout the globe,

global growth will continue.

Markets they operate Globally

Walmart has grown abroad and developed many locations in the United States.

Customers can now shop whenever and wherever they want online and in shops thanks to

innovation. Additionally, the business generates possibilities and adds value for clients and

communities worldwide. Walmart has around 10,500 shops, franchises, and eCommerce

websites worldwide under 46 banners. Nearly 1.6 million of its 2.3 million colleagues work in

the United States alone (Walton n.d). As a consequence, inventory totaling over 32 billion

dollars is being managed. Due to this sharp rise, Walmart has become one of the world’s most

innovative and leading businesses. From the study, it is simple to determine that Walmart acts as

a middleman between suppliers and manufacturers, implying that this firm oversees two supply
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chains, from receiving inventory from producers to delivering items to ultimate customers

(Walton n.d).

Current market trends

The employment of technology in supply chain management is a significant industry

trend. Technology is the main contributor to Walmart’s supply chain management’s

effectiveness (Bal & Pawlicka, 2021). Through technology, this organization has done away with

the idea of poor communication between its internal and external analysis. The efficient cross-

functional internal analysis and ongoing information exchange between Walmart and its partners

have also aided in the promotion of creative minds, which benefits their supply chain. Successful

supply chain management depends on several advances, including barcodes, RFID, radio

frequency identification tags that monitor pallets of goods as they go through the supply chain,

and smart tags that enable personnel to identify things that need to be replaced in the shop (Bal &

Pawlicka, 2021).

Another current trend is that Walmart shops still don’t have a large worldwide consumer

base compared to rivals like Amazon. Customers no longer frequent retail locations in favor of

online services due to technological advancements and a need for ease. This tactic, as used by

amazon, has assisted in reaching out to more customers, even in areas where there aren’t any

nearby retail locations (Begley et al., 2020). This technology allows Walmart to connect with

consumers in regions without Walmart shops (Begley et al., 2020). For most clients, deliveries

and pickup locations would be most convenient. For instance, despite the COVID-19 epidemic,

Amazon could still maintain its sales because of the availability of online services and door-to-

door delivery options. People avoided going into shops during the outbreak. Therefore, internet

services were the most effective.

Competitors

Due to its highly diversified business model, Walmart competes with businesses from

various sectors, including retail, e-commerce, logistics, and technology. Amazon, Costco, Target,

Kroger, The Home Depot, and Alibaba are a few significant rivals of Walmart, but these

companies compete in different market segments (Turner, 2022). Its most many rivals is

Amazon, a global technology corporation that provides cloud computing, e-commerce, and

artificial intelligence (A.I.) services. In 1994, when Jeff Bezos was a Wall Street investment

analyst, he founded the business (Turner, 2022). He began Amazon as an online bookstore but

quickly expanded to sell a wide range of goods, including toys, electronics, clothing, furniture,

and more (Jindal et al., 2021). Amazon is currently the world’s most prominent online

marketplace and cloud computing platform.

Amazon and Walmart are fierce rivals in the retail industry. They compete for profits,

market share, and customer mindshare. With a market share of 37.8%, Amazon dominates the e-

commerce sector. Walmart is far behind in second place, with a market share of 6.3%. Whole

Foods Market, which Amazon purchased in 2017 for $13.7 billion, accounted for most of its

brick-and-mortar sales. Amazon reported $4.68 billion for the fourth quarter of 2021, up from

$4.02 billion in the fourth quarter of 2020, despite having little to no presence in the physical

retail sector (Jindal et al., 2021). Because both businesses are market leaders in their respective

fields, they face competition in a variety of areas, including but not limited to price, product

selection, customer satisfaction, delivery, and logistics.

Costco is another formidable rival to Walmart. A series of membership-only warehouses

are run by the American multinational company Costco Wholesale Corporation. James Sinegal

and Jeffrey Brotman founded the business based in Issaquah, Washington (Tikhonova, 2021).
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Walmart faces significant competition from Costco, particularly in the food market. The

company is well known for selling high-quality goods at reasonable costs. Additionally, Costco

has a committed consumer base because of its membership strategy (Turner, 2022). Despite

having more worldwide locations than Costco (775 against 11,500), Walmart has a competitive

edge because of its emphasis on quality and customer loyalty (Tikhonova, 2021). Costco is

essentially a brick-and-mortar retailer, unlike Walmart, which runs a physical retail operation

and an online store. But it also provides an e-commerce platform, which brought in roughly

$7.547 million in 2021 (Tikhonova, 2021). The company’s wide range of products, affordable

rates, and top-notch customer service are some of its competitive advantages.

Target firm is one of Walmart’s other leading rivals. American retail company Target

Corporation. With $104.62 billion in sales, it was the seventh-largest retailer in the United States

as of 2021 (Wang, 2022). George Dayton founded the business in 1902, based in Minneapolis,

Minnesota. Target and Walmart concentrate on various areas of the retail industry (Wang, 2022).

Target is a more premium bargain shop than Walmart, which caters to the mass population. Even

if Walmart has more robust financials, Target is a more potent rival. Target has a solid

reputation, a devoted following of customers, and affordable pricing. Additionally, it has the

edge over Walmart because its physical sites are often found in wealthy areas.

Kroger is Walmart’s other primary rival. With $137.888 billion in sales in 2021, Kroger

is among the most significant supermarket merchants in the world (Wang, 2022). It trades on the

NYSE under the symbol K.R. and was the third-largest retailer in the U.S. as of 2021 (Wang,

2022). The financial standing of Kroger is good, with a sound balance sheet and positive cash

flow. The business has fared well throughout the epidemic owing to its practical operations and
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rising internet sales. Kroger is a formidable rival to Walmart, and its emphasis on e-commerce

will enable it to do so in the future (Wang, 2022).

Conclusion

In conclusion, Walmart successfully competes in a wide range of sectors. Due to its

emphasis on providing inexpensive pricing, the organization enjoys a distinctive competitive

edge. With its economies of scale, this tactic enables Walmart to outbid its competitors and

capture market share. Despite its challenges, such as fierce competition from Amazon, Walmart

has a solid basis to fight in the future because of its brick-and-mortar stores and well-known

brand. Costco, Target, and Kroger are among the more fierce rivals in the industry. Even though

each business has a distinct emphasis, they are all competitors of Walmart. Walmart must

consistently emphasize its primary advantages of cheap pricing and convenience to differentiate

itself from the competition. The business should also seek methods to enhance the quality of its

products and client service.

References

Bal, M., & Pawlicka, K. (2021). Supply chain finance and challenges of modern supply

chains. LogForum, 17(1). http://dx.doi.org/10.17270/J.LOG.2021.525.

Begley, S., Marohn, E., Mikha, S., & Rettaliata, A. (2020). Digital disruption at the grocery

store. McKinsey & Company: London, UK, 1-8.

Chang, Y., & Hu, J. (2020). Analysis of the Mode of Multinational Retail Enterprises Entering

the Chinese Market—Take Walmart, Carrefour, and Metro as Examples. Modern

Economy, 11(01), 17

Courtemanche, C., Carden, A., Zhou, X., & Ndirangu, M. (2019). Do Walmart supercenters

improve food security? Applied Economic Perspectives and Policy, 41(2), 177-198.

https://doi.org/10.1093/aepp/ppy023.

Jindal, R. P., Gauri, D. K., Li, W., & Ma, Y. (2021). Omnichannel battle between Amazon and

Walmart: Is the focus on delivery the best strategy? Journal of business research, 122,

270-280. https://doi.org/10.1016/j.jbusres.2020.08.053.

Расулова, С. Р. (2021). WALMART: EXAMPLE OF THE DYNAMICS OF THE US

ECONOMY. In МОЛОДОЙ УЧЕНЫЙ-2021 (pp. 78-81). https://elibrary.ru/item.asp?

id=46952976.

Pingolia, S. (2020). Case Analysis of Walmart and Flipkart M&A. Available at SSRN 3701098.

Tikhonova, M. (2021). Financial Analysis of Walmart and Costco in 2017-2018. Scientists, 100.

Turner, A. (2022). Walmart vs. Amazon: How Walmart can Compete with Amazon in the Age

of E-Commerce. https://scholarworks.uark.edu/finnuht/74.

Walton, S. History of Walmart. https://www.casrilanka.com/casl/images/stories/PDBF/walmart

%202019.pdf.
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Wang, C. H., & Gu, Y. W. (2022). Sales Forecasting, Market Analysis, and Performance

Assessment for U.S. Retail Firms: A Business Analytics Perspective. Applied

Sciences, 12(17), 8480. https://doi.org/10.3390/app12178480.