Fortune 500 Company Analysis Wal-Mart Is the Essay

Fortune 500 Company Analysis

Wal-Mart is the number one retailer in the world in both sales and earnings, dwarfing many of its retail competitors. It offers a full assortment of products ranging from clothing to electronics. It currently has 6000 locations predominately within the United States with over $312.4 Billion in net sales during 2006. In addition to its strong domestic presence, Wal-Mart has expanded aggressively to Canada, Mexico, and Puerto Rico with over 1000 locations within those countries. This expansion can potentially create greater economies of scale for Wal-Mart services and merchandise. The synergies created by expansion will also drive profitability in the future by providing goods and services at even lower costs to consumers. In order to enter foreign markets successful, Wal-Mart engages in both joint ventures and acquisitions. By utilizing this method, Wal-Mart intends to leverage foreign retailer's market knowledge with its own core competencies of merchandising and supply chain management.The success of Wal-Mart is due in large part to its ability to consistently produce high quality products at a low cost. This is very critical to the future success of Wal-Mart because it provides consistency to customers who are price sensitive. By committing themselves to "Everyday low prices," Wal-Mart assures customers that the products sold within their stores are competitive in reference to its retail competition. This low price strategy also provides Wal-Mart with a sustainable competitive advantage well into the future. This is important, because competitors will find it very difficult to mimic Wal-Mart's low price strategy while maintaining profitability. In fact, in 2004, Wal-Mart's lower prices saved domestic consumers $263 billion, which translates into $2,349 per household. These significant cost savings will be very difficult for competition to impersonate and as result, creates a sustainable competitive advantage that Wal-Mart will utilize well into the future. Currently, Wal-Mart is attempting to.....