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Wal-Mart¶s response to the hurricane was lauded even by its critics: it donated more than $20
million worth of merchandise, including food for 100,000 meals, and it promised jobs for all of
its displaced workers. The first supply truck to arrive at the Superdome after the hurricane came
from Walmart, not from FEMA. The administrative particulars of Wal-Mart¶s response to the
hurricane, detailed in a study by Steven Horwitz, are both fascinating and inspiring. Wal-Mart¶s
existing distribution chain was ± and is ± able to deliver needed goods faster and more efficiently
than a government agency, which (besides being inept) had no existing infrastructure to respond
to the disaster. Regardless of its reputation or its value to society, Walmart is here to stay.
Consumption drives our daily lives and accounts for some 70% of America¶s GDP. As long as
Walmart continues to increase the accessibility and quality of consumption, it will remain
America¶s top retailer and continue to grow. Whether or not you choose to shop at Walmart,
everyone should appreciate it.cWal-Mart is the leader in retailing industry with fiscal revenue of
$244.52 billion in 2003 making it the world's largest corporation. Mike reports that Wal-Mart as
of 2002 had 1,283,000 employees growing at 11.2%. The above data explains that strategy of
Wal-Mart is extraordinary which manages and operates over 4150 retail facilities globally. The
key components of Wal-Mart (The Value Chain), which offers cheap prices than its competitors
includes firm infrastructure like frugal culture, no regional offices and pleasant environment to
work.c



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An opportunity available to the industry is the free trade zone. When the government enters into
new trade agreements with foreign countries, businesses in the United States have the ability to
offer products from these countries in their stores. This simply increases the markets available to
retailers. In 2009, Walmart awarded approximately $2 billion to U.S. hourly associates through
financial incentives, including bonuses, profit sharing and 401(k) contributions, and hundreds of
millions of dollars in merchandise discounts and contributions to the associate stock purchase
plan.cWalmart is the world¶s largest retailer with $405 billion in sales for the fiscal year ending
Xan. 31, 2010. In the U.S., Wal-Mart Stores, Inc. operates more than 4,300 facilities including
Walmart supercenters, discount stores, Neighborhood Markets and Sam¶s Club warehouses.c
Despite the general weakness in the world economy and the uncertain environment that
prevailed, Walmart had reported sales growth of 11%, amounting to $6.4 billion. The company's
associates were indeed doing the Walmart cheer in faraway places like Germany, South
Korea, China and United Kingdom. In three decades, it had grown from its rural Arkansas roots
to become the world's largest company, and quite possibly the most powerful retailer c

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Walmart stores were geared toward the low-income customer segment; headquarters were
reflective of the company's tendency to be tightfisted as they were housed in warehouse style
buildings with minimalist decor. Frugality was a central tenet at the company, and every
associate was expected to fully adopt this value in all its manifestations. It was also said that the
company is homogenizing the marketplace by letting smaller towns dictate popular culture.

 

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Walmart was a leader in the use of technology to maximize operational efficiency. Very early
on, the company realized the value of proactive investments in technology and deployed a
private satellite network. Walmart also managed much of its own logistics through a central hub-
and-spoke system of warehouses and distribution centers. It was estimated that the corporate
logistics handled over million loads each year. The company has a core competence involving its
use of information technology to support its international logistics system. For example, it can
see how individual products are performing country-wide, store-by-store at a glance. IT also
supports Wal-Mart's efficient procurement. Customers shop at Walmart to get the best value for
their money. When it comes to sustainability, they are dedicated to providing them with that
same value. For Walmart, selling sustainable merchandise involves examining the entire lifespan
of the product ² from the materials used in making them, to the factories or farms where they
were made, to how they are used as an end-product. By bringing products like affordable organic
produce, fair trade coffee, Seventh Generation, and compact fluorescent light bulbs within the
reach of the 176 million customers who shop in Walmart stores, It believes that it can play a
powerful role in protecting our environment and our earth¶s natural resources - and in shifting
the behavior of the marketplace.

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Wal-Mart faces 38 state and federal lawsuits filed by hourly workers in 30 states, accusing the
company of systematically forcing them to work long hours off the clock. A Xuly 2000 internal
audit of 128 Wal-Mart stores found 127 were "not in compliance" with company policies
concerning workers not taking breakscAnother common complaint among corporate watchdog
organizations and social responsibility organizations is that Wal-Mart discriminates against
women employees. It has been reported thatc65% of the company's hourly employees are
women, but these workers earn 37 cents an hour less than male hourly employees for the same
work. Women working at Wal-Mart make on average 4.5 to 5.6 percent less than men for the
same work. Male management trainees make an average of $23,175 a year, compared with
$22,371 for women trainees. The average male senior vice president at Wal-Mart makes
$419,435 a year, while the four women senior vice presidents earn an average of $279,772. c
Wal-Mart was ordered to pay $765,000 in fines for violating state petroleum storage tank laws at
its automobile service centers in Florida. The Florida Department of Environmental Protection
said Wednesday that the world's largest retailer failed to register its aboveground fuel tanks with
the state and didn't install devices that prevent overflows, among other problems.


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An opportunity facing the industry is that customers want ease of shopping. To provide the ease
of shopping the industry is guaranteeing that the customers will find what they want when they
want it. This is supported by convenient presentation and the right level of service every time the
customer shops. A threat is customer theft. Manufacturers are fighting back against customer
theft by embedding paper clip sized antitheft tags, called electronic article surveillance labels,
inside products and packaging called source tagging, the process offers several major benefits.
For one, merchandise tagged on the factory floor during manufacture or packaging lets retail
employees spend less time in the storeroom applying labels and more time on the show floor
helping customers. Also, high-theft merchandise previously displayed behind glass can now sit
out in the open, boosting sales significantly.
Another social, cultural, demographic, and environmental threat is employee theft. Along with
antitheft labels there are radio-frequency circuits that are hidden in packages and go unnoticed.
The only time they will go off is when the bar code scanner does not deactivate the circuit, which
means they stole it. This helps to prevent the two forms of employee theft, which are sweat
hearting and sliding. Sweat hearting is when the employee charges the customer less than the
actual price and sliding is when the employee covers the barcode at the point of sale. Wal-Mart
has been known for their customer oriented approach. Wal-Mart maintains one of the best
satisfaction guaranteed programs, which promotes customer goodwill. One can return virtually
any product to Wal-Mart without any problems. They simply take the product back and promptly
refund the price of the product, nearly no questions asked. Perhaps the strongest aspect of Wal-
Mart is in its access to distribution networks. Wal-Mart uses a system known as cross-docking.
This is simply the process of continuously delivering goods to warehouses where they are sorted
and distributed to their stores within one day. This enables Wal-Mart to take advantage of
economies of scale with shipping trucks with full loads. This also gives Wal-Mart the ability to
increase the speed of deliveries, a faster response to market demands, and a low inventory. This
system has allowed Wal-Mart to decrease its sales cost by 2 to 3 percent over the industry.

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