Wal-Mart: SWOT analysis
Three of the strengths that were recognized in the company include its powerful retail brand, being a retail industry leader in the terms of growth and experience and its core competence in the use of information technology. Wal-Mart is well known all over the United States putting the nation under one name which is the Wal-Mart stores. It is a global company that has a powerful retail brand meaning it is highly recognized and is already a household name. It has established a reputation making it a promising business to support by other companies.
It has been one of the pioneers in the business so it has the edge over other small time players in terms of growth and years of experience in the business sector. Lastly, its advanced information technology has helped Wal-Mart to manage all its stores around the world that enables the management to supervise and take quick cost effective decisions. Weaknesses to Overcome Among the weaknesses found in the company involved huge span of control, lack of specialization or focused in selling products and the company’s global operations has presence in relatively few countries.
Having huge span of control in the US alone means huge responsibility. Aside form that the business is highly diversified in both the strategies and personnel. The administrator down to the smallest level of the organization should have proper coordination so as to ensure the companies smooth operation. The company lacks focused in the services and products it provide since it covers much items from food, clothing or apparels, grocery items, toys etc. which will not allow them to specialize like other stores that is known for their particular products.
Unlike other global companies which have covered almost all countries in the globe, Wal-Mart seems to be left behind with other companies in the global market. External environment Opportunities to Exploit There are opportunities foreseen in the company that must be taken into consideration like the capacity for mergers and strategic alliances, opportunities for future business expansion and having a diversified store types. Mergers and business alliances have become popular nowadays as global competition continues to grow.
It is possible for the business to merge with other companies with specialization like in healthcare or technology to upgrade its infrastructure. The company should study this possibility because it can help the business in the long run. Business expansion is not impossible within the company as it has the financial capability and the expertise to expand more. There are other countries haven’t reach by Wal-Mart and where it can serve as potential market. Lastly it has been a diversified store so it can continue to offer more services and products and serve the consumers even more with diversified services.
Threats to Overcome The expected company threat for the operations includes the factors like being the biggest target for high competition, exposure to political problems and intense price competition. Wal-Mart is look upon by those in the same business and they may not let Wal-Mart to monopolize the industry. Competition is always present and there is a possibility that competitors like Costco and other businesses will look for ways to reach the top. As a leading organization in the country they can be influence by political problems and issues as the public patronized them.
They will be involved in political issues since their highly influential. The price of consumer goods offered by Wal-Mart had decrease greatly due to outsourcing. Many companies have started to outsource that had lead to high price competition between companies in this industry. Price competition will be one of the biggest threats since companies will look for ways to make their prices lower and affordable.
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