Walmart Essay -- essays research papers

By exploiting core competencies firms can develop value creating strategies which are superior to their competitors. Wal-Mart are experts at using there core competencies to become superior to their competitors. There are three resources which allow a company to create a core competency. Tangible resources consist of assets that can be seen, financial resources (borrowing capacity), physical resources, organizational structure and technology. Wal-Mart is a huge and very powerful company and therefore uses its ability of lending to become a core competency. Intangible resources are characterized by human resources, resource for innovation, and reputation. This category is where Wal-Mart excels against all its competitors. Knowledge, training and corporate culture possessed by employees may be one of the most significant sources of core competencies and competitive advantages throughout the business world. This is due to being very hard to copy or substitute for. Brand equity consists of brand name and maintaining brand equity. Wal-Mart are masters at using this resource as an advantage over their competitor are Wal-Marts emphasis is on its image of everyday low prices and high quality goods when marketing. Wal-Mart uses many different channels when marketing itself. It uses television, radio, monthly circulars, weekly newspapers and many more channels. Each one of these channels can be used in an unique way to emphasize Wal-Mart’s position of selling quality products at low prices. Radio usually grabs the audience’s attention by promoting products which are experiencing high demand. Both of these channels are made stronger by the use of newspapers adverts and monthly circulars. In these marketing channels deeply discounted items are highlighted to the potential competitors and these items help lure the customers into the stores. The idea of having â€Å"quality for less† is a good marketing plan because it gets people into the store. It also offers a competitive advantage over the competitors because they can not financially match Wal-Mart prices. This is due to Wal-Mar t having better use of financial resources, technology and physical resources. By censoring some products Wal-Mart are trying to market themselves as a company with good values. They use this to attract families. Unfortunately this plan has negative and positive effects. A negative effect is the ef... ...eakness have been stated as an air of complacency or a loss of presentation and marketing in the stores. As a most firms grow they encounter problems with staying in the right direction. Wal-Mart must address this problem to continue to grow. Price deflation has been poorly by Wal-Mart and other retailers. â€Å"aiming to obtain sales increases, companies have bought more merchandise units of products that are experiencing price deflation, without allowing for the inelasticity of demand for most basic products† (lll). Basically this has reduced in markdowns which have resulted in reduced sales and gross margins. IFE Matrix The Internal factor Evaluation (IFE) matrix is used to summarize and evaluate the major strengths and weaknesses in the functional area of business. It also provides a basis for identifying and evaluating relationships between these areas. A weight is assigned to each factor with 0.0 being unimportant and 1.0 being all important. A rating is then assigned with 1 being minor weakness and 4 being a strength. Both of these are then multiplied together to get a weighted score. The closer the overall weighted score is to 4 the stronger the firm is. The average is 2.5.