External Environment Examination

 Essay regarding External Environment Analysis

Exterior Environment Examination


Oct 21, 2010

Patti Berlin

External Environment Analysis

Mike Walton started out Wal-Mart in 1962 and opened the first retail outlet in Rogers, Arkansas (History, 2010, s. 1). Walton was not fresh to the retail industry and had traveled the usa to learn whenever possible about the industry. Walton knew that customer needs were important to success and he planned to know whenever possible about the industry in order to meet those needs. Sam Walton experienced strong competition coming from retailers just like Target and Kmart when he decided to expand the company. At the moment, many merchants compete with Wal-Mart; however , the corporation has varied to car tire servicing, pharmaceuticals, home improvement, and in-store restaurants. Wal-Mart is presently capable of competitive in a wide-ranging market. Wal-Mart operates across the world in various sectors including super centers, community markets, lower price stores, as well as the Wal-Mart internet site. Wal-Mart's net sales to get the 2010 fiscal season were approximately $405 billion dollars, a 1% increase by 2009 (Walmart Annual Report, 2010, p. 15). Wal-Mart also knowledgeable 5. 1% increase in working profit from $22, 798 , 000, 000 in 2009 to $23, 950 million completely (Walmart Annual Report, 2010, p. 15). Further, net profits improved from seven percent from $13, 400 , 000, 000 in 2009 to $14, 335 million this season (Walmart Total annual report, 2010, p. 30). Wal-Mart's reputation for low prices, product range, and convenience has empowered the company to grow drastically and grow globally. Wal-Mart has made a fortune on its strengths to enhance successes. Relating to Pearce & Robinson (2009) Wal-Mart redefined lower price retailing and outperformed the industry in profitability simply by 4. 5% of sales—a 200% improvement. Four resources—store locations, manufacturer recognition, employee loyalty, and sophisticated incoming logistics—allowed Wal-Mart to fulfill buyer needs much better and more price effectively than Kmart and also other discount retailers (p. 173). Wal-Mart offers set the precedent to get retailing through its innovative logistics, distribution, and online sales capabilities. Although the monetary reports illustrate much durability for the company, weaknesses happen to be prevalent inside the corporation as well. Wal-Mart activities the most trouble expanding in to market areas. Many small towns through the entire United States deny Wal-Mart by penetrating the area market as a result of economic impacts Wal-Mart is known for. A large number of small businesses have to close due to inability to compete with Wal-Mart's pricing. Wal-Mart appears to have a capable organizational structure; although some flaws happen to be prevalent that creates challenges to get the company. Giving the lowest prices and getting together with customer requirements is a target Wal-Mart works in maintaining. However , reducing costs has created a conflict inside the organization's traditions. Cutting costs features helped meet customer requirements but simply at the apparent expense with the employees. The savings buyers receive are gained simply by cutting 4 corners with worker compensation and benefit programs. Inadequate income and pushing employees to work devoid of pay, has affected personnel negatively and poor customer satisfaction is a result. This practice has induced employees to get rid of respect pertaining to the company and this attitude offers transpired to the customer. Forcing employees to job off the clock is unjust and bad for the company's tradition and consumer needs. These issues have created an adverse image of Wal-Mart and a significant reason the organization experiences difficulty in penetrating new markets. Further more, legal issues happen to be viewed inadequately by the general public and reduce continuity. External Business Market: Wal-Mart's Continuity Strategy

Creating a tactical business continuity plan contains analyzing possible risks. Critical factors to consider when having a continuity plan are staff, equipment, and data. In the event of a disaster, the organization must be able to...

References: Hitt, M. A., Ireland, R. D., & Hoskisson, L. E. (2009). Strategic Administration: Concepts & Cases Competitiveness and Globalization (8th ed. ). Mason, OH: To the south Western Cengage Learning.

Pearce, J. A. II, & Robinson, 3rd there’s r. B. (2009). Strategic supervision: Formulation, rendering, and control (11th male impotence. ). New york city: McGraw-Hill.

Useem, J., Schlosser, J., & Kim, L. ). (March 3, 2003). One region under Wal-Mart how selling 's superpower--and our biggest most admired company--is changing the rules for corporate America. Retrieved Nov 1, 2010, from http://money.cnn.com/magazines/fortune/fortune_archive/2003/03/03/338383/index.htm

Wal-Mart Shops, Inc.. В (2010). Corporate. Retrieved November 1, 2010, by http://investors.walmartstores.com/phoenix.zhtml?c=112761&p=irol-faq

Wal-Mart Stores, Incorporation.. В (2010). В History. В Retrieved November 1, 2010, from http://walmartstores.com/sites/annualreport/2010/financials.aspx

Wal-Mart Retailers, Inc.. В (2010). В Walmart 2010 Annual Report. В Retrieved The fall of 1, 2010, from http://walmartstores.com/sites/annualreport/2010/financials.aspx

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