This is a brief SWOT analysis of Walmart. It aims to examine the strengths and the weaknesses of Walmart. It also aims to explore some of the opportunities and the threats facing the company. Walmart Inc. is a multinational retailer, headquartered at Arkansas in the USA.
SWOT analysis of Walmart – Walmart SWOT analysis
As mentioned above, this is a brief SWOT analysis of Walmart. However, it addresses some of the key issues as follows:
Strengths of Walmart
Walmart is the largest retailer in the world. It operates in 28 countries under 59 different names and has 11695 stores. It also has e-commerce websites in 11 countries. ASDA (U.K), Walmex (Mexico) and Seiyu (Japan) are some of the brand names owned by Walmart. Over 260 million customers and members visit Walmart each week (Walmart Inc, 2018). Such a big operation certainly enables the company to achieve better economies of scale.
Walmart revenue was $485.9 billion in the 2017 fiscal year. The company employs approximately 2.3 million associates worldwide, out of which 1.5 million are in the U.S. alone (Walmart Inc, 2018). It is also noteworthy that approximately 200,000 people were promoted to positions with more responsibilities and higher pay packages in 2017.
Walmart focuses on low prices on broad assortment to beat competition. Every Day Low Price (EDLP) is the central focus of the company’s strategy. Walmart is also famous for its commitment to corporate social responsibilities. It has a $2 billion commitment to fight hunger in the U.S. It also provides grants to thousands of organisations worldwide for social causes.
Weaknesses of Walmart
While Walmart has a number of great strengths, it is of course not without some limitations. For example, it faced high employee turnover over the years. However, to combat this, the company increased its starting salary for employees to $9 an hour in the USA.
Although Wlamart is the largest retailer in the world, its corporate image has been put in question because of numerous legal challenges. The company faces a huge number of lawsuits every year concerning issues such as discrimination, unequal pay, and unfair promotions. In 2001 alone, Walmart had to pay $6 million to settle 13 lawsuits filed by a number of disabled workers.
Opportunities for Walmart
Walmart operates in operates in 28 countries. Further expansion into those countries is a very good opportunity. It can also explore other countries, particularly emerging economies in Asia and Europe for market development. Likewise, introducing e-commerce websites in more countries is also worth exploring.
Improvement in HR practices is also a good opportunity. As mentioned earlier, Walmart faces challenges in employee turnover and employee relations. Both of these issues are very important and challenging for the company. Therefore, improving HR practices will not only improve the company’s image, but also help Walmart minimise some of its operating costs.
Threats to Walmart
The last element to address in the SWOT analysis of Walmart is the threat/s facing the company. Theoretically, competition from rivals is a threat. Walmart faces a fierce competition from Tesco, Amazon, Carrefour, and others in both the domestic and many of its international markets. For example, The Kroger Co, Albertsons, and Ahold USA are the key rivals of Walmart in the USA. Likewise, Tesco, Sainsbury’s and Morrisons are the key rivals of Walmart in the UK. In fact, Tesco is the market leader of the grocery market in the UK. To learn more about the top supermarkets in the UK, please read Top 10 supermarket chains in the UK.
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The article publication date: 11 February 2018
Walmart Inc (2018) Our Story, available at: https://corporate.walmart.com/ (Accessed 08 February 2018)
Photo credit: Walmart Canada
Author: M Rahman
M Rahman writes extensively online with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He is a graduate of Leeds Metropolitan University and London South Bank University.