Wal-Mart - Eyeing The Global Market

Wal-mart, the largest retailer in the world was established in US (Arkanas) in the year 1962 by Sam Walton, and grew steadily with sales figure of $218 billion and some 4500 stores by 2002. In the early stages Wal-mart operations were confined to the United States, where it established a competitive advantage based upon a combination of efficient merchandising and progressive human relations policies, probably taking a leaf out of the book of F.W Taylor.

Wal-mart was among few of the companies to implement information system to track product sales and inventory. Among some of the other successful strategies Wal-mart implemented were sharing widespread stock ownership among employees and pass on some of its benefits as low prices on to the consumers. With having substantial market share in general merchandising where it already had huge market presence, allowed the company to successfully foray into food retailing and make a huge dent in the market share of some of the established supermarket.

The competition in the domestic market by the year 1990 made Wal-Mart to think of expanding and by 1995 they were already present in 50 states of USA and by the year 2000 the company decided to go Global as they could sense saturation in the US market.

Going global was not such a smooth sailing though for the company, the critics wrote them off saying Wal-mart is to American a company to succeed in the global market. They predicted that constraints of Infrastructure, logistics and different consumer preference and some well established retailer's presence would make it difficult for the company to succeed globally.

Unperturbed by the perceived constraints Wal-mart started its global venture in 1991 by opening its first store in Mexico, as a joint venture with Cafera, one of the largest retailer stores in Mexico. As predicted, Wal-Mart made a number of mistakes that seemed to prove the critics right. Poor infrastructure, crowded roads and a lack of understanding with local suppliers, many of whom could not or would not deliver directly to Wal-Mart stores or distribution centres resulted in stocking problems and raised costs and prices .There were also problem with merchandise selection as most of the items housed in the Mexican shop were similar to that of/in the US, which did not go too well with the Mexican market.

Learning from its mistakes Wal-mart adapted itself well to meet the local environment requirement and needs. Some of the initiatives taken by the company to resolve the current crises included:

o A partnership with a Mexican trucking company which helped the company to dramatically improve their distribution system.

o A more careful approach towards stocking practices meant the stores sold merchandise that appealed more to the local tastes and preferences.

These strategies started paying rich dividends to the company and in the year 1998,Wal-mart acquired a controlling interest in "Cifera" and by the year 2002 Wal-mart was more then twice the size of its nearest rival in Mexico with 600 stores and revenue of more then $10 billion.

With some great results in Mexico, Wal-mart followed the same strategies and subsequently entered into eight other countries. It entered into JV partnerships with other retailers in Canada, Britain, Germany, Japan and South Korea .In Brazil, Argentina and China Wal-mart established its own stores. As a result the company had over 1200 stores outside the United States, 303,000 associates and generated international revenue of more then $35 billion.

Wal-mart continued its steady growth globally in spite of the few early difficulties it faced, and registered high growth rate.

o In 2004 Wal-Mart generated over $256 billion in global revenue, establishing a new record and adding more than $26 billion in sales. The Company earned almost $9.1 billion in net income and grew earnings per share by over 15 percent.

o Subsequent to fiscal year-end 2004, in February 2004, the Company completed its purchase of Bompreco S.A. Supermercados do Nordeste ("Bompreco"), a supermarket chain in northern Brazil with 118 hypermarkets, supermarkets and mini-markets. The purchase price was approximately $300 million.

o In 2006 Wal-Mart net sales rose 9.5% to a record $312.4 billion. Net income rose 9.4% to a record $11.2 billion. Our earnings per share grew double-digits from $2.41 to $2.68 per share.

o In 2006, Wal-mart were doing around 20% of there business abroad. Wal-Mart's marketplace is clearly the world.

o Wal-mart has total International portfolio divided among three of the Geographical locations(The Americas, Europe and Asia) with Americas - 71%, Asia - 17%a and Europe - 12%

While store development and expansion has experienced significant growth, it is not the only measure of success. The division has posted impressive financial results as well. Wal-Mart International announced that 2007 fiscal year end sales reached $77.1 billion, a 30.2 percent increase over the previous year, and that operating profit rose to $4.2 billion, an increase of 21.5 percent over the prior year.

Looking at some of the key information pointers above, Wal-Mart U.S. expects to open over 305 new, relocated or expanded units in the fiscal year ending January 31, 2007. Wal-Mart International plans to open over 220 new, relocated or expanded stores in the fiscal year ending January 31, 2007. The company further plans to continue acquisitions where they can add strategic value to the business.

In the year 2007 Wal-Mart were hit by twin turmoil's in the housing and credit markets, which further fuelled there, reason to look beyond U.S. and identified India as one of the potentional growth market. Wal- Mart which already pulled out of Korea and Japan this year, were constantly on a look out to enter the India Market and there reasons were quite obvious.

India being one of the emerging markets was an obvious choice for Wal-mart with an estimated 12 million kirana shops in India. Of these, the largest consumer-goods companies in the country are only able to service less than 10% of them. This means that 90% of these small stores are not directly serviced, providing a large and new market opportunity for the joint venture. However entering a country through the wholesale channel will be the first time for the Wal-mart globally.

After years of looking for a way into India's fast-growing but highly protected retail market, Wal-Mart Stores Inc. is trying a backdoor approach teaming up with an Indian phone company Bharti Enterprises to court the country's burgeoning middle class. India's Bharti Enterprises plans to invest up to $2 billion to $2.5 billion by 2015 in setting up a nationwide chain of supermarkets and retail shops in partnership with U.S. chain Wal-Mart. Together, they will set up 15 wholesale cash-and-carry stores over the next seven years. Focusing on the wholesale segment is Wal-Mart's best immediate option, given that India restricts direct foreign investment in consumer retailing. Despite obvious cultural and business challenges, Wal-Mart International has experienced success because of its ability to transport the company's unique culture and effective retailing concepts to each new country. The company makes a concerted effort to adapt to local cultures and become involved in the local community. Associates respond to customer needs, merchandise preferences and local suppliers. By serving each hometown in the same way, Wal-Mart International has realized significant growth with potential for much greater development worldwide.

In 2007, Wal-Mart International has opened around 320 to 330 units in existing markets. Relocations or expansion of existing stores has accounted for approximately 30 of these units, while the remainder represents new operating units for the company.

In the coming year 2008, The Company projects its capital spending in fiscal 2008 to increase by approximately 2 to 4 percent, which compares to the 15 to 20 percent increase forecast for fiscal 2007, Wal-mart, believes that capital spending in the U.S. will be approximately flat to the current fiscal year. This reduction in growth is expected to result from: building fewer U.S. units; anticipated flattening of construction costs; improvements in the distribution centre network; and design efficiency."

Wal-Mart - Sam Walton's Success Story

"There is only one boss - the customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else."

Growing Up

Sam Walton's career in retail began in 1940 when he become a sales trainee in Des Moines, Iowa at a J.C. Penney store. Despite his enthusiasm to serve the customers, Walton was not a model employee. His desire to make his customers happy was so great that he often let other responsibilities like paperwork and keeping the books fall by the wayside. He was almost fired by his boss who told him that he was not cut out for a career in retail. Walton kept his job, however, because of his ability as a great salesman.

In 1942, Walton was drafted into the United States army. He worked in the communications division of the Army Intelligence Corps and remained on home soil throughout the Second World War. When he left the army three years later, Walton was married, had a child, and decided to start his own business to support his new family. With the $5,000 that he had saved along with a $20,000 loan from his wife's father, he purchased a Ben Franklin variety store in Newport, Arkansas. Walton was 27 years old.

Starting The Business

By putting in many hours at the store and implementing a pricing strategy far below what his competitors were charging, Walton's new business took off. By 1950 he had the top performing Ben Franklin store in the area. Walton's landlord, seeing his success, decided that he wanted Walton to sell the store to his son. When Walton refused, the landlord decided not to renew Walton's lease and he was forced to shut down.

Walton's 10 commandments for business success were:

1) Commit to your business.

2) Share your profits with your associates and treat them like your partners.

3) Energize your colleagues.

4) Communicate everything you possibly can to your partners.

5) Appreciate everything your associates do for the business.

6) Celebrate your success.

7) Listen to everyone in your company.

8) Exceed your customers' expectations.

9) Control your expenses better than your competition.

10) Blaze your own path.

Determined as ever to succeed in his venture, Walton looked for other rural Arkansas towns for a new place to set up shop. He came across a small village called Bentonville and opened the Walton's Five and Dime in 1950. He made sure to get a 99-year lease this time on the property. The two local competitors in Bentonville did not want to discount their prices and Walton's business began to flourish.

Realizing he had a recipe for success, Walton began looking for other areas of expansion. He borrowed money and used the profits from his first stores to acquire more. By 1960, he owned 15 stores but he was not getting the kind of return on investment that he thought he would be making. He then made the decision to follow a heavy price cutting strategy and hope to get much higher volume to turn a larger profit. This was not a new idea. The problem at the time was that most discount stores were small,located in urban areas, and focused on specialty items. Walton's plan was to change the way retailing was done across the country.

Building An Empire

Walton's revolutionary plan was to have large superstores in rural towns that discounted a wide variety of products. His initial approach was to Ben Franklin. They turned him down as they did not like the idea of operating with lower margins. Without a large company behind him, Walton opted to go it alone. In 1962, he mortgaged his home and borrowed against everything he owned to open his first Wal-Mart in Rogers, Arkansas, a neighboring town of Bentonville.

Excited about the prospects of getting discounts and selection that were previously only obtainable in the cities, rural customers came out in droves to his store. The success of his first store allowed him to expand and by 1969 he had 18 Wal-Marts in Arkansas and Missouri.

Funded solely through debt and reinvested profits, Walton decided that in 1970 he would take the company public. The IPO raised $5 million and Walton retained 61 percent of the company. The money was used to settle the company's debts and fuel further expansion. By 1980, 276 Wal-Marts were operating.

An integral component of Wal-Mart's success was its leveraging of new technologies to improve efficiencies and save costs. Walton knew that the key to success in a low margin business was to rigidly control his costs. Wal-Mart was, for example, one of the first major retailers to use electronic scanners at the registers which tied to an inventory control system so they could know immediately which items were selling well and needed to be re-ordered.

The success of his Wal-Mart stores led Sam to another idea - Sam's Wholesale Clubs. These would be discount stores that sold to small business owners in bulk. The idea was another big hit for Walton and by 1985 he was considered by Forbes magazine to be the richest man in America with an estimated net worth of $2.8 billion.

Similar to Ray Kroc, Sam Walton did not invent retailing, he simply changed the business model and way of doing business to make it a much more profitable venture.

Evan is an entrepreneur and international speaker. At the age of 19, he became an owner and Chief Operating Officer in Redasoft, a biotechnology software company. The company quickly grew to over 300 organizations as clients, including NASA and Johnson & Johnson, in 30 countries. He started Evan Carmichael & Associates with the goal to give entrepreneurs the motivation to follow their passion and the strategies they need to succeed. Evan has delivered over 100 keynote presentations to entrepreneurs in North America, Europe, and Asia. He has been interviewed by newspapers, radio stations, and television stations including CHUM FM, CityTV, Global TV, OMNI TV, Enterprise, and the Toronto Sun. Evan's website, http://www.evancarmichael.com is the world's #1 website for small business motivation and strategies.

Eye Exam Wal-Mart Vision Center Coupons

The eye visitations have the ability to attack individual of any age both old age and young age. The fact can not be denied that the contact lenses and glasses can prove to be quiet costly and most of the people need them at some point of life. The free eye exam with purchase of glasses is available at many places with ease.

Only because you need to save your money you must not profess the quality of the services. You can search around to find many good exam deals. In an exception way, the free exam coupons are really easy to use and quiet handy. Many times your eyes are completely fine and healthy and you do not need to buy glasses, therefore these coupons are the best to go for.

In United States of America, several eye centers are providing good and free examination with their ultimate coupons. The well renowned eye examination coupons are offered by Wal-Mart Vision Center. The Wal-Mart eye exam coupons can really id you in taking up free regular eye check ups.

There are over 2000 shops of Wal-Mart Vision Center across United States of America, but still people feel the requirement to look out for cheaper glasses and contact lenses. The reason is people many times do not find the product suitable to look on their faces and therefore the Wal-Mart eye exam coupons are of no use then.

LensCrafters exam cost is also low and are good enough to suit your needs. The eye exam coupons are available for free at their web site. Their frames are available in different forms of styles and designs and they claim that every face will get something for them selves for sure. Even the price of basic exam is also quiet affordable so there is no reason to say no to regular eye check ups.