The Success of Walmart in the Economic World

The Success of Walmart in the Economic World

Sara E. Ulrich

Cardinal Stritch University

Abstract

Walmart is one of the largest corporations across the globe having total revenue in 2015 of $482 billion. There are more than 11,000 stores located in 27 countries. It has become a store that is everywhere you go. Walmart is the U.S’s largest employer, employing 2.3 million associates. This paper is going to explore how they have achieved their success by using economic concepts of supply and demand, price floors, and competitive firms.

Keywords: supply and demand, price floors, competitive firms

The Success of Walmart in the Economic World

On July 2, 1962 Sam Walton opened the first Walmart store in Rogers, Arkansas. His idea of a successful business was one that could be built around offering lower prices and great service. Sam’s philosophy was “Always low prices.” He knew that if he could sell products people used in their daily lives at prices just a little bit cheaper than those of the next guy, he’d be successful (Matthews, 2012). With this being his philosophy, he had to do away with the intermittent sales. He needed to be able to offer the best possible price every day of the year instead of offering a good deal every once in a while. In five short years, there were 24 stores open and making $12.7 million in sales. In 1970, Walmart became a publicly traded company and the first stock was sold at $16.50 per share. During the 1980’s there were 276 stores, had over 21,000 associates, opened the first Walmart Supercenter and Sam’s Club. By 1990, Walmart was the nation’s number one retailer. Because the Walmart Supercenter redefined convenience and one stop shopping, every day low prices went international by opening the first Sam’s Club in Mexico City. In 1992, Walmart operated 1,928 stores and clubs and employed 371,000 associates. In 2000, Walmart.com was founded and employed more than 1.1 million associates in 3,989 stores and clubs worldwide...