Retail Strategy Of

By S.Chaitanya Kumar 10M010

Over view
Wal-Mart was the largest retailing company in the world Wal-Mart has 8,500 stores in 15 countries, with 55 different names In 2009, it generated 51% of its US$258 billion sales in the U.S. from grocery business.

In 2010 it was the world's largest public corporation by revenue

History
The company was founded by Sam Walton in 1962, On July 2, 1962, Walton opened the first Wal-Mart Discount store in Arkansas Incorporated on October 31, 1969, and publicly traded on the NYSE in 1972 In the 1980s, Wal-Mart continued to grow rapidly, In 1987 it launched its own satellite network to communicate with all its branches worldwide In 1988, the first Wal-Mart Supercenter opened in Washington, Missouri In 1998, Wal-Mart introduced the "Neighborhood Market concept with three stores in Arkansas.

Employing more than 1.6 million "associates" worldwide. On September 12, 2007, Wal-Mart introduced new advertising with the slogan, "Save Money Live Better," replacing the "Always Low Prices, Always" slogan Wal-Mart was offering low prices, customer satisfaction guaranteed, and hours that were realistic for the way people wanted to shop. Open all night, for university students Wal-Mart's operations are organized into three divisions Wal-Mart Stores U.S., Sam's Club, and Wal-Mart International.

Its operating forms are

Supercenters, Food and drugs, General merchandise stores, Bodegas (small markets), Cash and carry stores, Membership warehouse clubs, Apparel stores, Soft discount stores and Restaurants.

Strategies
Low prices to customers Effective management of supply chain Effective logistics management

Effective inventory management

Introduced Hub And Spoke system Introduced Cross Docking

Always Low Prices , Always

Everyday low prices Powered by bargaining from suppliers Low procurement cost, so it is possible to sell on low prices They are careful about maintaining stock which is on demand Using highly automated distribution system and computerized inventory system

Supply chain Management

Procures goods directly from manufacturers Wal-Mart was a tough negotiator Will purchase only at least possible price from supplier They will bargain for customer they feel that their customer deserves it Their trucks will pick up goods from suppliers warehouse It had 40 distribution centers at various locations in in US Capable of storing 80,000 items They supplies 85 percent of inventory to stores

Hub and Spoke System

Under the system, goods were centrally ordered, assembled at a massive warehouse, known as distribution center (hub), from where they were dispatched to the individual stores (spoke). advantages by the centralized purchasing of goods in huge quantities..

Negotiation by the bulk order, less cost for carrying bulky goods

Logistics Management
Fast and responsive transportation system Distribution centers were serviced by 3,500 company trucks Believed in recruiting highly committed and dedicated drivers Stores were considered as customers by distribution center To make distribution effective they introduced cross docking

Cross Docking
In this system finished goods directly picked up from supplier, sorted out and directly delivered to customer

It reduces handling and storage cost

Requisitions received for different goods from stores were converted into procurement orders It changed process from supply chain to demand chain

Instead of retailer pushing products customer can pull products when ever or where ever they want

Inventory Management
There was a accelerated delivery system even replenishment possible with in a day It invested heavily in IT to track sales and inventory levels in stores across the country It allowed stores to manage their own stock reducing pack size across many product categories The company entered into collaboration with P&G to maintain inventory in its stores and built an automated re ordering system Employees are supported with hand held computers Sophisticated RFID and Universal Barcode System It is using Massively Parallel Processing (MPP) system to track the movement of goods and sales levels

Recommendations
Can diversify themselves into manufacturing

Can give choice about price of products to customers

Providing access for consumer syndicates to order for bulk goods Can provide customization of barcode system for customer ordered products Indian market had a huge potential for retail industry it can open more stores in India

Thank You