The WAL- MART story

By :

M.B.A (MKTG.)2007-2009
Rai Business School

Structure of the presentation

WAL- MART some facts

Accolades and recognition

How they did it WAL-MART in India the Bharti Wal-Mart deal The Competition Do we have to fear WAL-MART. The future of mom and pop stores Will WAL-MART be a success.

Founded in 1962 by Mr.Sam Walton First store opened in Bentonville,Arkansas Today 6600 stores worldwide in countries like Honduras,Japan,Mexico,Nicaragua,Puertorico,Argentina,Brazil, Canada,China,Costa-rica,El-salvadore,Guatemala and the U.K. 1.3 million people working

Sales for 2006 estimated to be $ 1billion per day.

YEAR - 2001 Fortune co.named Wal-Mart as the 3rd most admired company of America. The Financial Times and Pricewater house coopers ranked it as the 8th most admired company in the world. YEAR - 2002 Rated as the no.1 company on the fortune 500 list.

Presented with the Ron brown award for corparate leadership.

What it takes to be a WAL-MART

The Winning strategy- selling branded products at low cost.

Non dependence on any single vendor.

Reliablity on its own distribution system.

Intensive People focus

Associates
and NOT employees.

Various schemes and programmes for associates : Incentive bonuses A discount stock purchase plan

Promotion from within

Pay raise based on performance and not seniority. An open door policy Introduced profit sharing in 1971.

ROLE OF TECHNOLOGY
Implemented a satellite net work system.

Process like ordering ,shipping ,communications and logistics were automated.

Store level data sales were collected ,analyzed and transmitted electronically on a real time basis.

On November.27 2006,bharti enterprises and WALMART entered into joint venture of equal partnership to function in the cash and carry format. By Aug.2007 - first store in India.

Present status :
Recruitment Negotiations with potential customers Market surveys are on.

Bharti

In the market with old players like Pantaloons,Rahejas and RPG and new players like Reliance ,Aditya Birla group.
Partnering with Wal-Mart will give other players a run for their money. WAL-MART Partnering with bharti will give Wal Mart access to the 8th largest retail market in the world valued at $320 billion.

Advantage bharti
Huge ground network in the country already through its telecom business
Knows the Indian landscape and understands the demographics in this country. Knowledge of where to get the real estate for the business.

Advantage Wal-Mart
Companies innovative information technology .
Highly efficient service channel management which makes it possible to buy directly from the producers. Company has tremendous sourcing efficiencies which will bring economies of scale from day one.

The competition
M A R K E T P L A Y E R S

RELIANCE
It will operate hypermarkets,convenience and speciality stores as well as business to business operations ,sell food ,clothing ,electronic consumer durables,luxury goods and financial and travel services.

INFINITY RETAIL
The Tata group has partnered with Wool Worths ,for servicing and technical support .It opened the first store in Mumbai in Oct.2006.

PANTALOONS
BIG BAZAAR are rapidly expanding and are planning to open 100 stores by dec.07

DONT FEAR INDIA !

Fear of Wal-Mart
NO,NO
WAL Mart is not invincible
Last year it has to fled from Germany and South Korea

In Germany it lost $863 million (rs.4056 cr.)and sold all its 85 stores to Metro. In South korea
Had to sell all 16 stores.

Reasons
Local German stores Aldi and Lidl able to deliver good quality grocery at affordable prices.

Opened all stores in suburbs customers were very reluctant to drive that far.

Unable to understand the customer insights well

India is not America.

India is one country, but a hundred different markets.
28 States, 7 Union Territories, 14 different official languages, hundreds of dialects, multiple ethnicities, cultures and habits.

Geographical challenges :
India has 3 times more people then America
Population density 11 times that of America.

Look at China
The country has nearly 200 stores owned by Wal Mart ,Tesco and Carrefour yet domestic retailers are strong.

The big Indian plans

Reliance intends opening more stores (around 6,000) In 5 years than Wal Mart has opened in 44 years .

Advantage retail
BOOST EMPLOYMENT

America has more Wal Mart employees then high school teachers.
In China employing 150,000 people in next 5 Years. CREATION OF WEALTH They pay producers more and charge consumers less.

Resulting savings generate employment when they are spent on

other goods and services.

Future of mom and pop stores

Kirana stores offers services that are unmatched by organized retailers. Credit Personal suggestions Good relationships. Home delivery

The U.S.P
Their instant response to changing consumer needs.

WILL WAL-MART SUCCEED IN INDIA ???

IT WILL SUCCEED BECAUSE :
It has the best know how to provide the right set products to the right set of customers. Customers are also hungry for new ways of shopping.

SOURCE :
BUSINESS TODAY RETAILER ECONOMIC TIMES THE WAL MART WAY : DON SODERQUIST