Wal Mart Interest

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Professors Michael D. Kimbrough of Harvard Business School, Michael Faulkender of Washington University, Nicole Thorne Jenkins of

Vanderbilt University, and Research Associate Rachel Gordon, Global Research Group, prepared this case. HBS cases are developed solely as the

basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective

management.

Copyright © 2008, 2010 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-

7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. No part of this publication may be

reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical,

photocopying, recording, or otherwise—without the permission of Harvard Business School.

MICHAEL D. KIMBROUGH

MICHAEL FAULKENDER

NICOLE THORNE JENKINS

RACHEL GORDON

Walmart’s Use of Interest Rate Swaps

Company Background

The now-familiar story of Walmart’s emergence as a global behemoth began with the opening of

the first Walmart store by Sam Walton in 1962 in Rogers, Arkansas. Walmart’s success was due to a

disciplined adherence to the strategy of purchasing high volumes directly from manufacturers

combined with pioneering investments in information technology that allowed it to effectively

manage its supply chain and distribution networks. This strategy, when combined with Walton’s

lasting legacy of frugality and efficiency, allowed the company to sell at “every day low prices” to

consumers.

Walmart’s Growth Ambitions at the Turn of the Century

Although Walmart closed the twentieth century as the United States’ largest generator of sales

and the world’s...