Wal-Mart's Advantages and Disadvantages

Wal-mart's central competitive advantage is its size. According to the 2008 annual statement, Sam's club offers its customers "treasure finds". These are items that are not usually offered in the store. Because of its huge buying power, Wal-Mart could go to a book publisher and buy, say, 5% of a production run at a lower price than is offered to anyone else. It cannot carry the product all of the time at that rate, but it can gain a short-term discount for its customers.

Wal-mart stores work under a similar philosophy. Items for sale at Wal-Mart are often priced at far less than is available at other stores. However, if you are looking for something specific, Wal-Mart can not guarantee that it is there.

Much of Wal-mart's large scale success comes from its association with emerging foreign markets, China in particular. These markets act as excellent suppliers because their labor supply is high and the cost of living is low, so wages can be reduced. They also avoid the restrictions on worker safety and quality that come with a marke