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Wal-Mart Stores, Inc.

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Case 1-2, Wal-Mart Stores, Inc.
Discussion Questions:
1-1. What is Wal-Mart’s strategy?
Answer: The major wining strategy of Wal-Mart is selling branded products at low cost with large volume by improving their operation management system, utilize their buying power to lower the price from their vendors. The second strategy is to use “saturation” strategy for store expansion and further expansion to worldwide. The third strategy is Wal-Mart’s commitment to customers; always provide excellent service to their customers to make their customers always feel that Wal-Mart is very accountable and friendly. The fourth strategy is respect for the individuals, which Wal-Mart treads their employees well and push them to excel in what they do to increase employees’ loyalty and dedication.

1-2. What is the basis on which Wal-Mart builds its competitive advantage?
Answer:
The fundamental basis is lowering the cost as much as possible.
Wal-Mart has implemented the world most effective operation management system to reduce its cost on operation management, such like:
1. Reducing warehouse storage cost by utilizing RFID technologies, just-in-time method.
2. Reducing products distributions cost by carefully select the distribution center locations and store locations, and building up self owned world largest tracking networks.
3. Increase the efficiency of communication and information sharing by building up satellite communication channels and real-time information system, which allow the information to be shared between the company’s wide network stores, distribution centers and suppliers.
With Wal-Mart huge buying power, it can negotiate the lower price from its vendors which no one else can compete with them. And such buying power allow Mal-Mart never tie to just supplier, all the suppliers will compete each other on pricing and service, which allow Mal-Mart to

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