Compulsory assignment for the completion of thesis course at Carleton University\'s, Sprott School of Business. This strategic management presentation, displays understanding of the chosen corporation (Walmart), as well as its industry, and strategic objectives. Lastly, this presentation offers strategic alternatives based on weakness assessed.

1. Wal-Mart Stores Inc. Strategic Management Final Presentation Patricia D’Amato David Chrystal Tim Hall

2. The New Age of Wal-Mart

3. Agenda Company Overview Marco Environment Overview Technological Economic Social Political Industry Overview (Porter’s Five Forces) Value Chain Analysis Primary Value Creating Activities Secondary Value Creating Activities Corporate Strategy Business Strategy Recommendations

4. Company Overview Wal-Mart was founded in 1962 by Sam Walton Largest global corporation by revenues Largest market share of total global retail Operates in 16 countries globally Ranked top three in both Forbes and Fortune 500 for past 5 years

5. Technological Environment OPPORTUNITY Trend One: Increasing use of Radio Frequency Identification (RFID) Source: Pennsylvania State University

6. Technological Environment OPPORTUNITY Trend Two: Increase in Online Shopping and E- Commerce

8. Socio-Cultural Environment OPPORTUNITY Trend: Unequal Wealth Distribution

11. Strategic Group Map USA Price Convenience Stores Industry Annual Sales of $200B Department Stores Macy’s: $24,892B Saks: $3,029B Local Stores Discount Superstores (National Brand) Target Corp.:$64 948B K-Mart (Sears Holding Corp): $15,901B Supermarkets Walgreens: $59 034B Kroger Co.: $70,235B Hypermarkets Wal-Mart Inc: $ 239.5B Super Target (Target Brand) Small Discount Stores Dollar General Stores Inc: $9,495B Family Dollar Stores Inc: $6,984B Warehouse Superstores Costco Corp.: $72,483B B.J’s Wholesale Club: $10, 027B Product Diversity Note: All Figures from Mergent Online

12. Strategic Group Map Europe ConvenienceStores One Stop Convenience Stores – Owned by Tesco Local Stores RetailStores Argos–£4,282million Pounds (2009) Price Supermarkets Wm Morrison Supermarkets : £14,528 million (2008) Sainsbury’s Supermarket Ltd. £18,911 million (2008) Hypermarkets Tesco – £54,327 million (2008) Asda Wal-Mart Superstores: £24,442 million (2008) Product Diversity Note: All Figures from Mergent Online

13. Strategic Group Map Latin America Specialty StoresMilano $4.5B Department StoresEl Puerto de Liverpool $38B Price Local Stores Convenience Stores OXXO $45B 7 Eleven $5B Hypermarkets Wal-Mart Supercentre $70B Hypermercado Soriano $67B Mega Comercial Mexicana $19B Supermarkets Mercado Soriana $7B Comercial Mexicana $15B Superama (Wal-Mart) $13B Warehouse Superstores Sam’s Club $65B Costco $12.5B Product Diversity Note: All Figures from Mergent

14. Rivalry 6/10 Source: EuroMonitor

16. Threat of New Entrants 2/10 Capital Costs Associated with Hypermarket Discount Retail Source: 2008 Financial Statements, reported in millions USD

17. Substitutes 3.5/10 Source: GMID

18. Power of Suppliers 2.5/10 Over 100,000 global suppliers in industry Large retail market share of firms results in suppliers being “price takers” Suppliers dependant on revenues from large discount retailers Domestic suppliers in US, powerless due to threat of switching to foreign supplier The New York Times reports : “Wal-Mart pressured Coca-Cola into the production of a diet soft drink sweetened with Splenda, as its customers preferred it over aspartame.”

20. The switching costs to buyers is high, as they will almost always pay more at another retail outlet

21. Buyers also lose the convenience of one-stop-shop

23. Driving Force 1. Globalization of the hypermarket industry Industry is rapidly growing (7.6% over past 5 years) Increasing rivalry in this industry Supplier power further eroded Substitutes becoming a lessening factor

24. Supply Chain Management and Distribution STRENGTH Source: Mergent Online

25. Supply Chain Management and Distribution STRENGTH Source: Mergent Online

26. Supply Chain Management and Distribution STRENGTH Source: Mergent Online

27. Operations WEAKNESS Source: Mergent Online

28. Marketing and Sales STRENGTH Source: Calculated from WMT, TGT, and CARR annual statements

30. Include “real people”

31. Entirely price driven Source: 2009 WMT Annual Statement

32. Customer Service WEAKNESS Source: The American Customer Satisfaction Index

34. High employee turnover (44% WMT vs. 17% COST)

38. Corporate Leadership Strength Source: Mergent Online

39. Summary of Value Chain

41. Wal- Mart 2009 industry leader in ROICWMT 13.42%, COST 9.62% TGT 8.6%

44. 1994: Canada (Woolworth Corporation)

45. 1996: China -- Greenfield Venture

46. 1997: Germany (Wertkauf Hypermarkets)

47. 1999: UK (Asda Supermarkets)

50. International focus targeted towards developing markets.

51. Follows a global strategy

52. Highly standardized, “Hyper American” business modelSource:2009 WMT Annual Statement

54. Local response in Germany: “Highly bizarre corporate culture”

56. Strength and success has grown contingent on a strong USD and cheap Yuan

58. Sam’s Club

59. Wal-Mart

60. Neighbourhood MarketSource: 2009 WMT Annual Statement

61. Business Level Strategy

63. Due to violations of labour legislation, firm settled 63 class action law suits in 2008

64. Settlement is a reported $640 million (2008)

67. Respond and focus on local markets

68. Proper due diligence in international venturesDecrease Dependence on China Look to other emerging markets (i.e. India) for imports

69. RecommendationsCorporate Level Population by Age Source: GMID

70. RecommendationsBusiness Level Improve Corporate Social Responsibility Adopt stakeholder business approach Utilize “triple bottom line” means to measure success Raise employee wages Establish goals to employ minority groups and women

71. Thank you for Listening!! Any Questions??