Wal-Mart: Resources and Capabilities
Wal-Mart is the world's largest retailer, reporting $405 billion in local revenues in 2008 and estimated as drawing slightly more than 100 million people each week into its stores (The Stock Advisers 1). The key to ?Wal-Mart's success is its ability to keep both costs and prices low, both of which are related to its massive size and its capacity to use enormous bargaining power in its supplier relationships. Further, Wal-Mart has over time developed heavy reliance on inexpensive Chinese imports and has developed a network of distribution centers throughout the United States which also reduces costs through increased efficiency (The Stock Advisers 1). These resources and capabilities have generated competitive advantage for Wal-Mart, but the firm has experienced some very real challenges, particularly in the United States and in its efforts to become more globally dispersed (Clifford 1).
A powerful retail brand, Wal-Mart has a reputation for convenience, one stop shopping in a variety of product sectors, and excellent pricing ("SWOT Analysis Wal-Mart" 1). The company has grown substantially in recent years and has expended globally with a strong emphasis on the United Kingdom and other countries in Western Europe. It enjoys a core competence related to its use of information technology (IT) which supports its international logistics system while linking its distribution centers and suppliers to stores and facilitating real time or just in time delivery of goods.
Conversely, as the world's largest grocery retailer, Wal-Mart must confront an enormous span of control issues ("SWOT Analysis Wal-Mart" 2). Though global, the firm has a presence in relatively few countries although it does have the capital and expertise to acquire, merge with, or develop strategic alliances with other global retailers in the greater China region or Europe. New locations and store types offer the fir...