Walmart Company’s Success, Growth and Profitability

Background Information

Wal-Mart is a retail entity that operates in the United States and other countries around the world. According to Fortune Global 500, the corporation suffices as the second largest with regard to operations and annual turnover. It has received numerous accolades for its stature in offering employment and retail services (Brunn, 2013). Despite its inception as a family business, Wal-Mart has grown into a global entity with operations in numerous countries around the world. Wal-Mart’s success demonstrates how proper managerial practices stimulate growth and profitability within organizations (Brunn, 2013).

Its resilience is exemplary because most of its contemporaries have failed to reach such heights of success. In fact, Wal-Mart’s success story is indicative of deliberate strategic planning and a desire for success in a competitive corporate environment (Brunn, 2013). In the absence of planning and proper management, it is difficult for organizational entities to seize opportunities that arise in the market. Wal-Mart is famous for its policies that favor consumers as opposed to selfish institutional interests (Brunn, 2013). The corporation does not preoccupy with profiteering at the expense of consumers. This unique approach bolsters its position as a global leader in retail and warehouse operations (Brunn, 2013).

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This research undertaking seeks to analyze various factors that influence Wal-Mart’s success, growth, and profitability. The analysis shall cover strengths, weaknesses, opportunities, and threats that characterize its operations in various markets. This essay shall also relay appropriate recommendations that could ultimately ameliorate Wal-Mart’s operations around the world.

SWOT Analysis

This analysis shall evaluate various operational realities that define how Wal-Mart conducts its businesses within the market. Most organizational entities experience challenges and threats that ultimately undermine their quest for success and profitability in competitive market segments (Brunn, 2013). Most of them fail to counter such challenges due to poor management and inability to understand the dynamics with regard to operations in their markets. Proper and strategic management empowers organizations to exploit strengths and opportunities that enable them to seize room for expansion and profitability (Brunn, 2013).

By conducting a SWOT analysis, organizations get the opportunity for introspection and evaluation regarding their operations and sustainability in competitive markets. It is evident that Wal-Mart has numerous strengths and opportunities that bolster its position as a leader in retail and warehouse operations within its market segment. However, there are weaknesses and threats that require attention in order to guarantee growth and success in the market (Brunn, 2013).

Strengths

Wal-Mart has numerous strengths that bolster its efforts with regard to resilience and success in the market. Such factors play an important role in ensuring consistency and overall customer satisfaction. The corporation has a loyal customer base that believes in its products and services (Soderquist, 2013). Customer loyalty is an integral component with regard to sustenance and propagation of operations within the market. Devoid of customer loyalty and support, it would be difficult for the organization to support and sustain its operations (Soderquist, 2013). Wal-Mart offers relevant services and products that gear towards satisfying customers and other stakeholders in its commercial regime. Most of its customers feel appreciated and valued due to the quality of service and other undertakings that characterize their engagement with the corporate entity (Soderquist, 2013).

In order to propagate customer satisfaction and loyalty, Wal-Mart conducts market surveys that seek to establish recurrent needs among customers and other stakeholders. This makes it possible for them to formulate and initiate structural frameworks that offer the requisite avenues for growth and profitability (Soderquist, 2013). Strength lies in its ability to offer quality products at competitive prices. Most of their products are cheaper in comparison to prices offered by competitors. This factor accords them numerous opportunities to attract and retain customers. The location also plays an important role in determining success and growth in the market. Most Wal-Mart stores and outlets are strategically located within the market (Soderquist, 2013). This is instrumental in determining success because it works towards enhancing accessibility and convenience (Soderquist, 2013).

Most customers prefer outlets that are accessible, convenient, and strategic with regard to their needs. Wal-Mart also guarantees employee satisfaction through reward programs and commensurate compensation packages. Employee satisfaction influences productivity through motivation and willingness to work towards the realization and actualization of organizational goals (Soderquist, 2013).

Weaknesses

Wal-Mart has numerous weaknesses that could affect its prospects within the market. Such areas of interest require attention because they could ultimately undermine its ability to fulfill vital organizational aspirations. An example of such factors is the large inventory that the corporate entity has to maintain in its daily operations (Soderquist, 2013). In order to guarantee and sustain lower prices, Wal-Mart needs to procure goods in bulk. This could jeopardize the overall reliability of their inventory due to factors that characterize such bulk procurements. Consequently, most of their products lack variety in terms of packaging and size. Such a lack of flexibility is not good for business because it could undermine confidence with regard to customers (Soderquist, 2013).

Wal-Mart attracts criticism due to their preference for part-time employees. Critics argue that the organization enlists part-time employees to avoid paying out benefits that are mandatory as stipulated by regulatory entities. Critics view this strategy as an avenue for exploitation and inappropriate treatment with regard to employees (Soderquist, 2013). Wal-Mart sources its products from countries that lack proper labor laws. This propagates indirect exploitation and inappropriate business practices. Most markets are skeptical whenever Wal-Mart seeks to initiate operations because it puts smaller entities out of business. According to critics, this reality introduces unfair practice in favor of monopoly and undue dominance. The organization should develop structural frameworks that address the aforementioned weaknesses (Soderquist, 2013).

Opportunities

Wal-Mart should preoccupy on efforts that guarantee its sustenance as a leader within the market. For instance, there is a need for efforts that gear towards reinvention and propagation of positive attitudes with regard to their operations. The corporation should also strive to expand operations to countries that have great potential (Scott, 2012). This shall play a role in enhancing dominance, growth, and profitability.

Due to its influence, Wal-Mart should engage authorities with regard to tax breaks and incentives that could ultimately bolster their desire for profitability and expansion. The organization should protect and uphold legal provisions that govern fair commerce and employee welfare (Scott, 2012). This will improve overall perception relating to their disregard for labor laws and fair business practices. Such perceptions and negative publicity led to a decline in productivity and performance within the market (Scott, 2012). Wal-Mart should also engage in corporate social responsibility programs in order to ameliorate its relationship with the communities around them. They should focus on efforts that seek to promote environmental safety and conservation (Scott, 2012).

Threats

Wal-Mart faces numerous threats that could undermine their operations within the market. For instance, the current economic orientation does not encourage commercial engagements. The cost of living is high, and this could affect operations with regard to customer satisfaction (Scott, 2012). The organization could face tough tax regimes due to current struggles between local corporations and those from countries such as China. Such legal tussles do not facilitate fair trade and propagation of other related commercial undertakings (Slater, 2011).

Wal-Mart also faces threats from employees as they clamor for unions in order to secure pertinent interests at the workplace. This could destabilize operations because employees are likely to use underhand tactics in pushing for negotiations (Slater, 2011). The corporation also faces stiff competition from retailers such as Costco. Such competition could affect operations because most competitors have similar services and products (Slater, 2011).

Recommendations and Conclusion

From the above case analysis, it is evident that Wal-Mart has a future in the retail market. Its current position is stable and futuristic in various regards. However, there is a need for reinvention and posturing in order to secure room for growth and productivity in an increasingly competitive market (Slater, 2011). Wal-Mart should always adhere to legal provisions that govern commercial undertakings within the market. This shall reduce costs incurred through litigation and other related legal undertakings. The corporation should ensure a healthy relationship with employees in order to guarantee productivity and progress.

This should materialize through the creation of unions that shall agitate for their rights and privileges (Slater, 2011). The company should bolster its corporate social responsibility programs. This shall facilitate engagement with stakeholders and communities that enhance its operations within the market. It is important for the management to initiate organizational structures to support and facilitate the above recommendations because they constitute an integral aspect of its growth and propagation. Devoid of such decisive steps, it will be difficult for Wal-Mart to attain its ideals and aspirations with regard to success within the market (Slater, 2011).

References

Brunn, S. (2013). Wal-Mart World: The World’s Biggest Corporation in the Global Economy. Newyork: Taylor & Francis. Web.

Scott, R. (2012). Wal-Mart: A History of Sam Walton’s Retail Phenomenon. Newyork: Twayne Publishers. Web.

Slater, R. (2011). Wal-Mart Decade. Newyork: Penguin Group (USA) Incorporated. Web.

Soderquist, D. (2013). The Wal-Mart Way: The Inside Story of the Success of the World’s Largest Company. Newyork: Thomas Nelson Inc. Web.

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