What are some of the key success factors of Wal-Mart?

Question

What will be an ideal response?

Answer 1

Wal-Mart transformed its competitors, its suppliers and the industries it dominated. Its key success factors were
scale, scope and speed. Scope allowed Wal-Mart to make changes to its stores to allow for seasonal changes in the
demand for certain products. It also allowed Wal-Mart to use entire categories as loss leaders to get more people to
shop of their stores. As for speed, Wal-Mart had such a rapid turnover that 70% of its merchandise was rung up at
the register before the company had paid for it. Speed was a reason why they shipped from China through the Suez
Canal and across the Atlantic so that 50% of imports landed up on each coast, which was expensive in the short run,
but they had the vision to see that it was faster in the long run.
In addition to the key success factors Wal-Mart followed a number of strategies that allowed it to reach the
success that it has today. It started with Sam Walton's philosophy. He believed in providing value to the customer,
sharing information and profit with employees, and concepts such as flat organization, empowerment and gain
sharing long before these were industry accepted terms. He save billions for his customers. He saw manufacturers,
wholesalers, retailers and consumers as part of a single customer focused process rather than as participants in a series of transactions, and he worked to alter the relationships between these people to allow them to work together,
rather than against each other. His philosophy of everyday low prices allotted to save merchandising and
advertising costs, and his huge stores offered economies of scale of a wide choice of merchandise.