Wal-Mart Analysis

Wal-Mart: Company Analysis

Introduction

Wal-Mart is an American publicly traded company and the world’s largest retail company. It offers a variety of general merchandise such as apparel, toys, electronics, small appliances, health and beauty products, fabrics, lawn and garden, crafts, jewelry, and household needs. In addition, Wal-Mart also has a pharmacy department, Tire and Lube Express, a Photo processing center, and a large grocery department. In fact, they are the largest grocery chain by sales and over half of their sales come from grocery items. It was created in 1962 by Sam Walton in the small town of Rogers, Arkansas. Mr. Walton started with the idea of opening a discount oriented shopping store and opened a small chain of stores called Walton’s 5 & 10. Prior to the Walton’s 5 & 10 stores, he owned a franchise in the Ben Franklin stores (Lee, 2007). Mr. Walton declared there would be three primary goals that would define his business; respect for the individual, service to customers, and striving for excellence (Hayden, Lee, McMahon, & Pereira, 2002). Wal-Mart grew fairly quickly as Wal-Mart Stores Inc. was incorporated seven years after the first store was opened. By 1970 it was publicly traded and by 1971 Wal-Mart had opened its first distribution center in Arkansas. It was in 1972 that Wal-Mart was valued on the New York Stock Exchange (ticker WMT). In 1980 Wal-Mart reached $1 billion in annual sales, which was faster than any other company had ever done (Walmart.com, 2013). Because of its rapid growth, Wal-Mart Stores Inc. developed into three sizes. Neighborhood markets at approximately 47,000 square feet, discount stores at approximately 100,000 square feet, and supercenters at approximately 187,000 square feet. Wal-Mart Stores Inc. split their business model into two segments, one being Wal-Mart retail stores and the other being Sam’s Club, which opened in 1984. Sam’s Club offered exclusively to its customers “members only” services...