Walmart Company’s SWOT Analysis

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Table of Contents

Introduction: Company Information
SWOT Graphic
SWOT Descriptions
Goal Statements
References

Introduction: Company Information

Walmart is a worldwide retailer. The story of its success began with the opening of a single discount store about 50 years ago. Since then, the company has managed to open more than 11,000 stores, operating in 28 countries (including the Americas, Asia, Africa, and Great Britain). Besides its physical presence, Walmart is also an influential e-commerce player involved in online business across 11 countries. The retail giant employs more than 2.3 million people, half of whom are located in the United States.

Nearly 260 million customers prefer Walmart, bringing its fiscal revenues to around $500 billion. Walmart’s mission statement reads like this, “Saving people money so they can live better” (Walmart, n.d.). The company’s vision statement centers on lower prices, higher quality, and the best services, demonstrating that Walmart desires to become the best company operating in the retail industry. The company’s primary value is helping its customers live better by having to spend less money on necessities, giving them more options for choosing the best quality products and services.

Because Walmart is a retailer, it specializes in selling a wide range of products; however, the company has switched to providing services with the aim of winning more customers and increasing the level of satisfaction with the company’s performance and development. These days, Walmart offers baby, household, sports, and electronic products, as well as office supplies, jewelry, books, and foodstuffs. Moreover, it provides on-site services such as photo laboratory, financial and wireless phone services, and pharmacy. Walmart is always working to add to this list because all products and services can be bought or ordered online. Home and office deliveries are also available.

SWOT Graphic

Strengths 1. A global network of stores and online services 2. An assortment of products and services offered to customers	Opportunities 1. Additional investments in business and employee development 2. Changes in markets (involvement of developing market and growth of popularity of online shopping services)
Weaknesses 1. High employee turnover 2. Geographical scope (most developing countries are reached by online shopping services – no physical presence)	Threats 1. Social and environmental issues (failing to meet certain standards) 2. Changes in the market (failing to satisfy customer’s demand or the emergence of a new retail giant)

SWOT Descriptions

Strengths

A global network of stores and online services

Reason: Walmart runs stores in South and North Americas, Asia, Africa, and Great Britain, serving as a kind of a bridge between the developed and developing world. It has both physical and online stores, making it easier for customers to choose the shopping format they prefer, or to buy goods from Walmart in all countries because it offers international deliveries.

Citation: “Each week, we serve close to 260 million customers in our stores, in 27 countries, and through our websites globally” (Walmart, 2015).

“11 countries with dedicated Walmart e-commerce websites” (Walmart, 2015).

Assortment of products and services offered to customers

Reason: Walmart sells a wide range of fresh and semi-finished products as well as items in electronics, books and jewelry categories. Walmart offers services such as photo laboratory, pharmacy, wireless phone and financial services.

Citation: “On the e-commerce front, we provide those same things through an expanded assortment of approximately 8 million items on walmart.com” (Walmart, 2015).

“The Walmart U.S. team is implementing a broad range of initiatives focused on strengthening our assortment (especially the fresh offering)” (Walmart, 2015).

Weaknesses

High employee turnover

Reason: Even though Walmart is an influential company, employee turnover is extremely high due to low wages and long working days.

Citation: “The size of and turnover in our hourly workforce” (Walmart, 2015) is one of the primary risks and uncertainties of the environment in which Walmart operates.

Geographical scope (most developing countries are reached by online shopping services – no physical presence)

Reason: Even though Walmart operates in 27 countries, websites are launched in only 11 of those. Regardless of offering international deliveries, such a gap proves a significant weakness because not all customers have equal access to the company’s services.

Citation: “11 countries with dedicated Walmart e-commerce websites” (Walmart, 2015).

“Customers served weekly in our stores in 27 countries and through websites globally” (Walmart, 2015).

Opportunities

Additional investments in business and employee development

Reason: Increasing investments via training, higher wages, opening new stores and launching new e-commerce websites would be beneficial for winning more customers, for improving the company’s positions in the global economy and for decreasing employee turnover.

Citation: “We expect that our increased hourly wages and additional investments in training, announced in February, will provide greater career opportunities for our club associates” (Walmart, 2015).

“Our future is bright because we’re increasing our investments in associates, stores and e-commerce capabilities to prepare for the way customers will want to shop with us in this new era of retail” (Walmart, 2015).

The changes in markets (involvement of developing market and growth of popularity of online shopping services)

Reason: Walmart works on broadening the assortment of goods and on improving the quality of its services. This effort will continue to benefit the company even though this requires decisive action and additional investment.

Citation: “Operations in Canada, Mexico and China continue to improve, leading to stronger sales and profitability” (Walmart, 2015).

“E-commerce sales rose faster than the market globally last year at approximately 22 percent” (Walmart, 2015).

Threats

Social and environmental issues (failing to meet the standards)

Reason: Today, most people tend to choose products offered in environmentally friendly packaging that brings minimal negative effects to the natural environment. Customers also prefer green packaging of product deliveries. In addition, gender equality and decent living conditions are typical concerns that might affect the company’s influence. Even though Walmart succeeds in meeting standards, those benchmarks change quickly, meaning that the company should continue to work on meeting them to avoid downturns in performance.

Citation: “The environmental and social impact continues to be an important consideration” (Walmart, 2015).

Changes in market (failing to satisfy customer’s demand or the emergence of a new retail giant)

Reason: Even though it is impossible to forecast the emergence of a new retail giant, it is one very real potential threat, as most developing countries, especially in Asia, attempt to launch stores of a similar format to offer substitutes for lower prices at nearly the same level of quality. Since in most cases, people prefer quality over brand, customers will search for new ways to save money.

Citation:”The U.K. market has become fiercely competitive, and in Brazil, we continue to work on improving performance” (Walmart, 2015).

Goal Statements

Strengths and opportunities

(S) global network of stores and (O) changes in markets

Goal statement: turn into a retail leader

Reason: This goal should be achieved in order to conform to Walmart’s mission and vision statements.

Citation: “Our new leadership team, led by Greg Foran, is focused on improving our customer experience through assortment, price and access” (Walmart, 2015).

“Our leadership team is focused on a common goal to be the most trusted retailer everywhere we operate” (Walmart, 2015).

Strengths and weaknesses

(S) global network of stores and (W) presence in a relatively small number of countries abroad

Goal statement: strengthen physical presence in countries

Reason: If the company is interested in maintaining its leading positions, it must bridge the gap between the countries of physical and online stores available.

Citation: “11 countries with dedicated Walmart e-commerce websites” (Walmart, 2015).

“Customers served weekly in our stores in 27 countries and through websites globally” (Walmart, 2015).

Weaknesses and opportunities

(W) high turnover rates and (O) employee development

Goal statement: train employees to decrease turnover rates

Reason: Maintaining its leading positions is impossible without decreasing employee turnover, because training new employees is an expense, and these monies could be spent more effectively. That is why it is better to invest in training the current employees and providing them higher wages instead of always bringing new people on board.

Threats and opportunities

(T) changes in market and (O) business development

Goal statement: make a company more influential

Reason: Walmart should invest in markets analysis and opening new stores, and it should launch new websites in order to strengthen its industry positions.

Citation: “We continue to use our stores to test innovations like order pickup and grocery home shopping to position Walmart as the global leader in integrating digital and physical retailing” (Walmart, 2015).

References

Walmart. (2015). 2015 annual report. Web.

Walmart. (n.d.) Our history. Web.

Washington, T. (n.d.). What kind of service does Walmart provide?. Web.

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