I, The Absolute

In Sam We Trust

Posted by itheabsolute on July 13, 2005

• 36 % of the dog food, 32 % of the diapers, 30 % of the photo-films, 26 % of the toothpaste, and 21 % of the painkillers sold in the US are sold at Wal-Mart.
• 39 % of the sales of Tandy, 23 % of the sales of Revlon, 20 % of the RJR Tobacco, and 17 % of the sales of P & G are sold through Wal-Mart.
• Wal-Mart’s daily sales are higher than the GNP of 40 countries
• Wal-Mart’s annual sales are higher than the GDP of 190+ countries
• Wal-Mart’s each year growth is equal to Pepsi’s annual sales.
• Wal-Mart loses US$ 2 Billion because of pilferage.
• USD 285 Billion sales at the year ending Jan 31, 2005 year
• More than 138 million customers per week visit Wal-Mart stores worldwide
• Wal-Mart employs 1.6 million associates
• Wal-Mart grocery prices are 17 to 20 percent lower than other supermarkets
• Wal-Mart potentially saves individual families more than $500 a year
• Wal-Mart employs a Chief Diversity Officer, to take care of diversity initiatives
• Wal-Mart buys merchandise and services from more than 61,000 U.S suppliers and supports over 3 million supplier jobs in the United States
• P&G is working on restructuring its business/organization to develop synergies in working with Wal-Mart. P&G already has linked up with Wal-Mart. P&G gets data on every sale of its products made at Wal-mart. Its production is aligned to meet demand at Wal-Mart. P&G expects that by 2010 about 50 % of its sales is going to be done through Wal-Mart.
• The heartbeat of many a retailer in India stopped for a moment when the President of Wal-Mart visited India sometime in May/June to consider options in India. (India is yet to allow foreign investment in Retail)
• Wal-Mart has one of the highest number of law suits running against any firm

How did Wal-Mart grow so large that corporate giants such as P&G are looking at realigning their businesses to work synergistically with Wal-Mart.

• Vision of its founder, Sam Walton – His untiring spirit and belief in Americana; His utmost contempt for things flashy and almost nauseatingly excess love for frugality;
• Excellent sense of what customers want
• Excellent logistics management
• Excellent operations – in store operations / distribution
• And fantastic use of Technology to excel in inventory management (this is where Wal-Mart makes or can further improve all its profits)

Post Scriptum

• The reference of the title is to a book on Sam Walton and Wal-Mart, called “ In Sam We Trust” by Bob Ortega.

• Tomorrow we have our last Competitive Strategy session. Our case for tomorrow’s discussion is Wal-Mart Stores, Inc.

Flip side of Wal-Mart’s growth
• A survey in Iowa revealed what had happened in that state since Wal-Mart had arrived in 1983:
o 50% of clothing stores had closed
o 30% of hardware stores had closed
o 25% of building materials stores had closed
o 42% of variety stores had closed
o 29% of shoe stores had closed
o 17% of jewellery stores had closed
o 26% of department stores had closed
• On average, about 100 stores go out of business in the area surrounding a town with a new Wal-Mart store

2 Responses to “In Sam We Trust”

  1. Amit said

    Vijay, govt has apparently decided against FDI in retail for the moment. Seems even Walmart CEO couldnt influence the leftists.
    For now the local heroes like Shopper’s Stop & Big Bazaar can heave a sigh of relief. But big daddy is def gonna come one day not too far in future. & recently ATK rated India as no. 1 retail destination in the world. So, exciting times to come.

  2. Hi there

    Interesting compilation of Walmart statistics. As someone who buys stuff from Walmart all the time, I of course like their “commitment” to low prices. However on the flip side, I think it would make for great statistics on how Walmart gets a bad rap, deservedly so for short shrifting its workers (called Associates). I believe most of them wake minimum-wage with no benefits, health insurance etc. I think it would be worthwhile to consider that aspect of their business practice to get an overall perspective of the “true success” of Walmart.

    Hey, good luck on the Spanish class.
    Mejor de suerte!

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