Walmart Company Service Improvement
Walmart is among the world’s retail corporations; that started in 1962 and has a head office in Bentonville, Arkansas. According to Pandey et al. (2021), Walmart runs various stores, including discount stores, grocery stores, and supercenters, providing highly affordable merchandise. The products offered include electronics, clothing, toys, automotive goods, and services such as tax preparation and pharmacies. Recently, the company launched the GoLocal service that uses drones to enhance the delivery of goods of all business sizes to customers.
As an innovative officer, the focus will be product assortment planning to improve service provision. It involves determining the types and number of products to offer, focusing on making decisions regarding the variety, service level, and depth of the Walmart product portfolio. These decisions will help during the economic downturn by enabling adaptations to various financial circumstances. At Walmart, there are so many levels of products; reducing them is the only way to increase sales.
Furthermore, to prevent the wastage of products, the invention of a company system will be necessary. The system will use radio frequency identification with the engine for prices for not less than 60 variables to calculate fees. Then, electronic shelf labeling will display costs in digital form. As a result, customers can choose food products nearing expiry at a low price.
The strategies will be efficient and fit into Walmart’s core competencies. Thus, the company can improve service provision and get the upper hand over its competitors by utilizing these mechanisms. The critical aspect of this service is the ability to provide autonomy to customers in choosing whether or not they need to trade their money for the products.
Walmart Company Value Proposition
Walmart runs a variety of retail establishments, including supermarkets, hypermarkets, grocery stores, neighboring markets, and discount stores. According to Berneis and Winkler (2021), the value proposition includes service leadership, cost savings, dedication, and a focus on creative problem-solving. Hence, the organization possesses a distinct value proposition that aligns with its business principles. The value proposition involves offering customers diverse products at affordable prices and with enhanced convenience.
Walmart Profitability
Walmart provides a global platform for individuals to save money through retail and e-commerce options, allowing people to shop conveniently and at affordable prices. Integrating e-commerce into retail stores enhances customers’ experience by introducing innovative solutions that save them time. Walmart can offer affordable prices to customers by effectively managing expenses and implementing cost-saving measures.
Over the past three years, Walmart has experienced an upward trend in its gross profit margins. It implies the revenue percentage that covers expenses such as operations. In addition, the company’s operating profit margin has been on the increase since 2020 to date. In general, Walmart is a highly profitable company. According to an investigation by Alatrsh (2022), the company experienced an increase in profit from a total of $13.7 billion in 2021 to a whopping $13.9 billion in 2022.
SWOT Analysis Strengths
Walmart uses its competitive advantage to advance and dominate the retail industry. As the largest retailer in the world, the company has unmatched vibrant market power and operations compared to its competitors. As per the findings of Smith, J. (2019), it has been reported that Walmart holds the top position in terms of revenue and is also the leading private employer with a workforce of over 2.3 million employees. Walmart possesses another advantage in the form of its cost leadership strategy. Through manufacturing and selling commodities, the company benefits from economies of scale. The cost leadership strategy has made Walmart the world’s largest retailer.
Product and Service Singularity
The success of Walmart lies in the strategy of Everyday Low Prices. The system has been in use since the company’s inception, and it does not apply to other retail companies. The popularity of the EDLP strategy has led to increased customer attraction and a competitive edge for Walmart. Walmart implements cost-cutting measures to eliminate wasteful processes and unnecessary layers to uphold affordable prices and maintain a competitive edge. Furthermore, Walmart has emphasized effectively managing logistics and supply chain operations to minimize expenses and streamline processes, eliminating unnecessary delays.
New Service Projections
The implementation of the EDLP strategy by Walmart is predicted to result in a rise in the demand for product purchases. A competitive advantage can be gained when lower prices attract many people to make purchases. Furthermore, Walmart’s customers will exhibit loyalty towards the company’s services due to the affordable prices offered on high-quality products. Hence, consistent loyalty will result in elevated profits due to heightened purchasing levels. For example, implementing the approach will increase Walmart’s profits from $13.9 billion in 2022 to approximately $14.1 billion in 2023.
References
Alatrsh, M. B. (2022). Portfolio Analysis Financial Statement of Walmart Inc.(WMT). Available at SSRN 4092146.
Business Strategy Hub. (2020). SWOT analysis for Walmart – Google Search. Www.google.com. https://www.google.com/search?q=SWOT+analysis+for+Walmart&sxsrf=ALiCzsacQJrtauwImYN8CXjrQdUgspQVJQ:1666377891536&source=lnms&tbm=isch&sa=X&ved=2ahUKEwiu_6Sy_fH6AhXF2qQKHfDBAI4Q_AUoAXoECAIQAw&biw=1366&bih=657&dpr=1#imgrc=eBtx2Ou0Fdj2rM
Berneis, M., & Winkler, H. (2021). Value proposition assessment of blockchain technology for luxury, food, and healthcare supply chains. Logistics, 5(4), 85.
Pandey, R., Dillip, D., Jayant, J., Vashishth, K., Nikhil, N., Qi, T. J., … & Qhi, L. Y. (2021). Factors Influencing Organization Success: A Case Study of Walmart. International Journal of Tourism and hospitality in Asia Pasific (IJTHAP), 4(2), 112-123.
Smith, J. (2019). Big Box Supermarkets (Walmart Supercenters). Increasing Access to Food: A Comprehensive Report on Food Supply Options, 5.
Appendix
SWOT Analysis
Strengths
Weaknesses
1 . Market Leader: Walmart is the world’s largest retailer by revenue and operates in multiple countries, giving it a strong global presence.
1. Labor Issues: Walmart has faced criticism and legal challenges related to labor practices, including low wages and alleged mistreatment of workers.
2. Economies of Scale: The company’s vast size allows it to achieve economies of scale, leading to lower costs and competitive pricing for customers.
2. E-commerce Competition: Walmart faces fierce competition from online retailers like Amazon, which has been rapidly growing in market share.
3. Diverse Product Portfolio: Walmart offers a wide range of products, from groceries to electronics, attracting a broad customer base.
3. Environmental Concerns: Environmental activists have raised concerns about Walmart’s sustainability practices and its impact on the environment.
4. Supply Chain Efficiency: Walmart’s supply chain management is known for its efficiency and innovation, helping reduce costs and improve inventory management.
4. International Challenges: Adapting to different international markets and regulations can be challenging and lead to operational difficulties.
Opportunities
Threats
1. E-commerce Growth: Walmart can continue to expand its e-commerce presence to capture a growing online shopping market.
1. Online Retail Competition: Intense competition from online giants like Amazon and Alibaba poses a threat to Walmart’s market share and profitability.
2. International Expansion: There are opportunities for Walmart to enter or expand further into emerging markets, such as India and China.
2. Changing Consumer Preferences: Consumer preferences are evolving, and if Walmart fails to adapt, it may lose customers to more innovative competitors.
3. Health and Wellness: The demand for health and wellness products and services presents opportunities for Walmart to diversify its offerings.
3. Regulatory Changes: Changes in regulations and government policies can impact Walmart’s operations and profitability, especially in the healthcare and retail sectors.
4. Sustainability Initiatives: By investing in sustainability and responsible business practices, Walmart can enhance its reputation and attract environmentally conscious customers.
4. Supply Chain Disruptions: Events like natural disasters, trade disputes, or global pandemics can disrupt Walmart’s supply chain and operations.