Assessment 2 - Final Project A Strategic Analysis of Walmart Inc Case Study

• Type Case Study
• Downloads540
• Pages13
• Words3212

1. Introduction - A Strategic Analysis of Walmart Inc Case Study

Overview of Walmart

Sam Walton opened Walmart Inc. in 1962, and it is now a leading global retailer with headquarters in Bentonville, Arkansas. In 19 countries across the globe, Walmart employs more than 2.1 million people and offers its services to millions of customers through thousands of its stores each week. Wal-Mart’s main goal, “To save people money so they can have a better life,” ensures that it supplies inexpensive items while keeping the organization running smoothly. To be competitive in an online world, the company has switched to digital transformation, including support for in-store and online shopping.

Falling behind on submissions? Get reliable Assignment Help For Students, with 100% original content, free revisions, and on-time delivery to keep your grades on track.

Scope of the Report and Focus of the Analysis

Although Walmart is doing well, it encounters difficulties from Amazon’s competitors, too many stores in certain regions, and the need to offer low costs without losing quality. Because of these challenges, Walmart becomes a useful case to look at for finding out how businesses maintain an edge against competition.

Scope of the Report and Focus of the Analysis

This report will mainly discuss Walmart’s leadership in cost-cutting and the use of multiple sales channels. With the help of SWOT, PESTLE, and Porter’s Five Forces, the report will look at how Walmart is competing and what important issues it has to deal with.

Assessment 2 - Final Project A Strategic Analysis of Walmart Inc Case Study

Liked This Case Study? Hire Me Now

Mark Brown 3 Years | MSc in Management

Objectives

• To review whether Walmart’s approach to being a low-cost competitor is working.
• To assess the company’s use of multiple selling channels.
• To examine the organization’s strengths and weaknesses as well as opportunities and threats by using SWOT, PESTLE, and Porter’s Five Forces.
• To locate major issues and suggest appropriate solutions.
• To review the outcomes of Walmart’s shift into the digital world.

Research Questions

1. How powerful is Walmart’s approach of being a cost leader?
2. How has the company’s omnichannel policy helped it respond to changes in the market?
3. Which things inside and outside the company influence its strategy?
4. What is Walmart experiencing in terms of challenges, and how would it deal with them?
5. How does the company’s advancement towards digitalization affect both its efficiency and the experience customers get?

2. Main Analysis

2.1. Organization Overview

Walmart Inc. is a huge retail company established in 1962 by Sam Walton. Walmart, a company in Bentonville, Arkansas, has 10,750 stores in 19 countries and employs more than 2.1 million individuals across the world. The mission of Walmart shows that it aims to make products and services available to customers so they can spend less and have a better life (Weinstein et al., 2022). Walmart is determined to assist people across the world to have better lives by giving them affordable prices, which is still the top goal of its operations.

Figure 1: Walmart Logo

Walmart has become the leader in offering great value by selling a huge variety of products at low costs (Rickard, 2024). The main areas of the company’s business are hypermarkets, department stores, and grocery stores. Besides having retail stores, Walmart is developing its e-commerce, meeting the demands of consumers who prefer to shop for things online (Turner, 2022).

For years, Walmart has shown outstanding financial results by bringing in more than $500 billion in sales each year (Tikhonova, 2021). Some of the company’s key achievements are using a cost leadership strategy and moving into digitalization. Also, the company encounters challenges such as stiff competition from famous online sellers like Amazon and the duty to change and maintain its budget offers continuously.

2.2. Application of Strategic Models

2.2.1. SWOT Analysis

Figure 2: SWOT Analysis

Strengths

The company’s strength in the market comes from its list of significant advantages compared to other businesses. One important aspect is that the Walmart brand is strongly connected to being affordable and easy for most people. In addition, the company has more than 10,750 stores worldwide and an e-commerce platform that attracts more and more customers. Thanks to its wide network, Walmart serves consumers all over the world. Besides, Walmart’s financial strength makes it possible for the company to engage in large activities, develop new technologies, and provide low prices.

Weaknesses

Although Walmart is strong in many ways, it still encounters certain problems within the company. Sometimes, focusing on low pricing makes it difficult for the company to distinguish its products, so expensive items for wealthy clients are impossible to offer (Stonig et al., 2022). Besides, Walmart suffers from inefficiencies within its huge supply chain system, and this may slow down its operations and lead to delays. The company is also criticized for how much money employees earn and the conditions they work in, which might harm the company’s brand and lower employee morale.

Opportunities

Walmart has many opportunities available to it from the outside. Because of e-commerce growth, there is a big opportunity to build up its presence online. As people want more environmentally friendly products, Walmart can make its range of goods more varied. Zenith Bank is an example of how new technologies in AI and automation streamline business activities and support a better experience for customers.

Threats

Walmart is being threatened by competition, mainly from companies such as Amazon that have a bigger presence online. The economic downturn makes things harder because people could start spending less on luxury items. Changes in regulations for key industries, relating to workers and nature, may make businesses spend more.

2.2.2. PESTLE Analysis

Figure 3: PESTLE Analysis

Political

Walmart needs to adjust its operations according to regulations in the countries where it works. Stable governments and new laws affecting taxes or tariffs impact the way the company runs its business and expands to other countries.

Economic

Issues such as inflation, rates of interest rates, and changes in exchange value impact Walmart’s business directly. When inflation goes up, people buy less, so Walmart can gain more by selling low-cost products. Even so, periods of recession can lower people’s spending, especially on items they don’t need.

Social

The way people shop and the country’s demographics have a big influence on the strategies Walmart uses. Since people care more about sustainability and ethical shopping, Walmart could adjust its selection of products in these areas.

Technological

With the use of new technologies, Walmart can make its supply chain management, inventory, and service to customers better.

Legal

Questions of labor laws for workers and rights about the products offered are among the legal issues Walmart tackles. Updates in consumer protection can cause the company to modify its operations and marketing activities.

Environmental

The way Walmart plans its strategy is affected by how sustainable it is and the rules set by environmental regulators. The company has made a promise to cut down on its carbon emissions and expand the range of environmentally friendly products it offers.

2.2.3. Porter’s Five Forces Analysis

Figure 4: Porter’s Five Forces

(Source: linkedin.com, 2025)

Threat of New Entrants

There is not a high risk of new companies joining the retail industry. Although there is a lot of profit in retail, getting in takes a lot of money, a thorough distribution system, and facing competitors like Walmart (Jindal et al., 2021). New companies would find it difficult to match the big economies, global network, and respected brand name that Walmart has.

Bargaining Power of Suppliers

The influence of suppliers is not very strong when it comes to Walmart. Walmart’s buying power gives it an advantage when it discusses prices and agreements with its suppliers. Walmart uses cost leadership by making sure that suppliers charge less, so the suppliers cannot hold too much power.

Bargaining Power of Customers

People have many treatment options since stores and shops both in-person and online, compete fiercely for their business. Because e-commerce is so easy to use, people can find and use competitors’ services at the slightest sign of a better deal.

Threat of Substitute Products or Services

Substitutes for education are not too widespread. There are many products available from different retailers for customers to choose from, but Walmart’s low prices and convenience make it unlikely for people to stop shopping there. Even so, there are various online stores and niche retailers that give alternatives, mainly for items that are luxury or have specific features.

Industry Rivalry

There is a lot of competition in the retail industry. Traditional stores like Target and Costco, and online companies such as Amazon, are among the competitors Walmart has to deal with. Such action by these companies includes selling products at low prices, investing in technology, and trying out new ways of retail, which makes the situation more competitive.

2.2.4. Additional Models

Figure 5: Ansoff Matrix

Ansoff Matrix

The Ansoff Matrix can help examine the growth strategy adopted by Walmart. The matrix points out the major growth strategies, which include market penetration, market development, product development, and diversification.

• Market Penetration: To gain a larger share in core markets, Walmart has increased how many of stores it has, introduced more e-commerce, and priced its items competitively. The company is constantly striving to make customers loyal and raise the number of sales in places where it already operates.
• Market Development: Walmart has extended its business to China and India by forming alliances and buying out companies. Giving its low-income model to emerging nations allows it to grow in those countries.
• Product Development: Walmart continues to develop new products by adding a bigger range of private-label products and eco-friendly products. The rise in such products is in line with what customers want today.
• Diversification: Walmart chose to expand its work in the field by introducing financial services and e-commerce as new businesses. Young Commerce is making use of digital tools to enhance its part in online selling.

Because of these methods, Walmart wants to become an even stronger market leader and explore new areas while staying competitive in an industry that is always changing.

2.3. Strategic Issues

It is difficult for Walmart to maintain its low-cost position as it follows consumers’ changing purchasing habits and markets change. Low prices have brought success to Walmart, but it makes it hard for the company to offer different services and items (Durand and Baud, 2024). Walmart may lose customers to competitors who put more effort into making their products unique, for example, Amazon. Since there are more options for customers now, due to online shopping, their power in the market is stronger.

Internal Weaknesses

The company’s use of low-price products is a liability within the business. Because the company needs high sales to earn profits with their low prices, they face a challenge in keeping costs down and keeping items of good quality. In addition, problems with the company’s supply chain and employee relationships have continued. As an example, because Walmart operates on such a big scale, it is able to achieve better deals with suppliers, yet its operations can be so extensive that they cause some problems with deliveries.

External Threats

Competition from Target, Costco, and especially Amazon is one of the greatest dangers that Walmart faces these days. Because of digital changes and expanding online shopping, Walmart is finding it harder to keep its leadership in its main business. Moreover, when the economy slows and the company faces more regulations, this may lead to loss of profit for Walmart (Prasetyo, 2022). As a result of these outside influences, Walmart has to spend considerably on tech and environmental improvements, adding further to their expenses.

All of these problems could keep Walmart from retaining its leading position and making profits in the future. Managers must pay attention to various challenges by focusing on innovation, including the development of various products and the experience customers receive.

3. Discussion

Alignment with Strategic Frameworks

Walmart relies on being a cost leader, thanks to Porter’s Five Forces and the SWOT analysis, which make up the main structure of its business model. Using its large-scale operations, the company offers customers low prices, which is key in Porter’s idea of cost leadership (Jerab and Mabrouk, 2023). Because of this strategy, Walmart continues to be ahead of competitors in a market where prices play a big role. Using an omnichannel strategy that links physical and online shopping is inventive and is typical in modern business strategies, such as the Ansoff Matrix, which focuses on growing the market and product development.

Success of the Current Strategy

The strategy used by Walmart has helped its place as a worldwide retail leader. Because it uses cost leadership and also develops its e-commerce platform, Walmart is able to compete with companies of all sorts. The fact that the company is active around the world, is well known, and has negotiating abilities with suppliers makes its position in the market stronger. On the other hand, the company struggles, mainly in trying to offer low prices and meet customer expectations for environmentally friendly and costly goods.

Influence of External Factors

Economic troubles, rivalry, and new regulations are changing the plans of Walmart. Because e-commerce has grown and customers now look for eco-friendly items, Walmart is spending more money on digital changes and green products, causing their operating costs to rise. To retain its profits, Walmart is having to update its strategy in light of these changes outside the company.

Lessons Learned

The story of Walmart pinpoints how crucial it is to be flexible when markets are always adapting. Many retail companies can follow Walmart’s lead in combining the focus on costs with digital improvements. Being innovate within the main strategic goals is critical to preserving the company’s competitive position.

4. Conclusions

Key Findings

The study of Walmart’s strategy has pointed out various results that show its role in retail. Walmart achieves its success mainly through its cost leadership policy, making it possible to set low prices due to having an efficient supply chain and running businesses on a wide scale. Moreover, the company stands strong in the market by combining the experience of regular stores with its growing online services.

Answers to Research Questions

1. Effectiveness of Walmart’s Cost Leadership Strategy: Walmart can maintain its competitive position with a strong cost leadership approach, however, it encounters difficulties because people are choosing more and more specialty goods.
2. Impact of the Omnichannel Strategy: Walmart’s omnichannel strategy has increased its flexibility in the ever-changing world of retail and made shopping easier for clients.
3. Internal and External Factors: According to the analysis, both poor choices in business, like putting emphasis on low-margin goods, and factors existing in the industry shape Walmart’s strategies.
4. Strategic Challenges: It is difficult for Walmart to continue selling goods at low prices, introduce more expensive products, and meet new consumer expectations.
5. Digital Transformation: Walmart’s use of digital tools has made it possible to remain efficient while pleasing customers, although the costs have gone up.

Implications for Walmart

It is clear that Walmart must carry on innovating, consider the environment, and balance between low prices and selling different products to emerge as the top in the market. Using new technologies in operations is also necessary to continue being a top player in the market.

Limitations and Future Research

Even though the analysis looks at major strategic points, research could go on to study Walmart’s plans for long-term presence, how government rules impact its businesses worldwide, and in what manner its new supply chain practices function.

5. Recommendations

Enhance Product Differentiation

Since low-profit products and growing preference for premium items make the situation difficult, Walmart ought to work on increasing variety in its product selection. Having diverse premium products on offer, some of which are green and others only sold at the company’s stores, would be beneficial for the company (Erwin et al., 2021). The move will entice well-paid customers and make Walmart a pioneer in the sustainability of retail. Walmart ought to look into joining forces with brands that are focused on ethics and new ideas in the industry.

Strengthen E-commerce Capabilities and Integration

Since online shopping is becoming more popular, Walmart should not stop investing in its digital side and e-commerce. Improving its focus on digital transformation, especially AI, data analytics, and automation, will ensure the company provides better online shopping experiences, customize customer interactions, and improves how the company operates (Rathore, 2023). When both physical and online stores are blended seamlessly, this will improve the customer’s experience and get them to be more loyal.

Focus on Sustainability and Corporate Social Responsibility (CSR)

Since people are becoming more interested in sustainability, Walmart should keep investing in environmentally friendly strategies for its supply chains, energy supply, and packaging. Using sustainability in its operations allows a company to keep loyal customers and attract those interested in such factors (Ahmad et al., 2021). Walmart can target carbon neutrality by a given year and show how things are progressing publicly to build a stronger brand for itself.

Diversify Into New Markets and Product Categories

Walmart can keep growing by getting involved in new markets that it has partly ignored. It will also help the company if it can grow in the financial services and healthcare sectors. When Walmart launches new services, it attracts more people and reduces the company’s focus on traditional retail products.

References

• Ahmad, N., Mahmood, A., Ariza-Montes, A., Han, H., Hernández-Perlines, F., Araya-Castillo, L. and Scholz, M., 2021. Sustainable businesses speak to the heart of consumers: Looking at sustainability with a marketing lens to reap banking consumers’ loyalty. Sustainability, 13(7), p.3828. https://www.mdpi.com/2071-1050/13/7/3828
• consulterce.com, 2025. TOPIC RELATED TO PESTLE Analysis. Viewed on 10th June 2025. From, https://consulterce.com/pestle-analysis/
• corporatefinanceinstitute.com, 2025. TOPIC RELATED TO SWOT Analysis. Viewed on 10th June 2025. From, https://corporatefinanceinstitute.com/resources/management/swot-analysis/
• Durand, C. and Baud, C., 2024. Profit-making, costs, and investments in the digitalization of retailing—the uneven trajectories of Carrefour, Amazon and Walmart (1995–2019). Competition & Change, 28(2), pp.318-339. https://journals.sagepub.com/doi/abs/10.1177/10245294231204973
• Erwin, E., Suade, Y.K.M. and Poernomo, W., 2021. Analyzing digital marketing, green marketing, networking and product innovation on sustainability business performance, silk cluster in Polewali-Mandar, west Sulawesi. International Journal of Economics, Business and Accounting Research (IJEBAR), 5(3), pp.2850-2871. http://www.jurnal.stie-aas.ac.id/index.php/IJEBAR/article/view/3048
• Jerab, D. and Mabrouk, T., 2023. Achieving competitive advantage through cost leadership strategy: Strategies for Sustainable Success. Available at SSRN 4574945. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4574945
• Jindal, R.P., Gauri, D.K., Li, W. and Ma, Y., 2021. Omnichannel battle between Amazon and Walmart: Is the focus on delivery the best strategy?. Journal of business research, 122, pp.270-280. https://www.sciencedirect.com/science/article/pii/S0148296320305658
• linkedin.com, 2025. TOPIC RELATED TO Porter’s Five Forces. Viewed on 10th June 2025. From, https://www.linkedin.com/pulse/leveraging-porters-five-forces-enhanced-procurement-ramzi-zopvf/
• Prasetyo, Y., 2022, April. “Keep Our Walmart Open!”: What Happens When Walmart Closes Its Doors and Moves Away from Small Town Rural America?. In RUSET 2021: Proceedings of the 2nd International Conference on Rural Socio-Economic Transformation: Agrarian, Ecology, Communication and Community Development Perspectives, RUSET 2021, 14-15 September 2021, Bogor, West Java, Indonesia (p. 118). European Alliance for Innovation. https://books.google.com/books?hl=en&lr=&id=VbZ4EAAAQBAJ&oi=fnd&pg=PA118&dq=when+the+economy+slows+and+the+company+faces+more+regulations,+this+may+lead+to+loss+in+profit+for+Walmart&ots=-hCQYcEG9I&sig=6yOTdQ2LfngZtN0S4AwRslNJgEI
• Rathore, B., 2023. Digital transformation 4.0: integration of artificial intelligence & metaverse in marketing. Eduzone: International Peer Reviewed/Refereed Multidisciplinary Journal, 12(1), pp.42-48. https://www.researchgate.net/profile/Bharati-Rathore-2/publication/368789565_Digital_Transformation_40_Integration_of_Artificial_Intelligence_Metaverse_in_Marketing/links/63f9d19d0d98a97717b8350e/Digital-Transformation-40-Integration-of-Artificial-Intelligence-Metaverse-in-Marketing.pdf
• Rickard, B., 2024. Large-scale organizational change leadership: The emergence, impact, and evolution of Walmart. https://minds.wisconsin.edu/bitstream/handle/1793/84836/Rickard,%20Briauna.pdf?sequence=1
• Stonig, J., Schmid, T. and Müller‐Stewens, G., 2022. From product system to ecosystem: how firms adapt to provide an integrated value proposition. Strategic Management Journal, 43(9), pp.1927-1957. https://onlinelibrary.wiley.com/doi/abs/10.1002/smj.3390
• thestrategyinstitute.org, 2025. TOPIC RELATED TO Ansoff Matrix. Viewed on 10th June 2025. From, https://www.thestrategyinstitute.org/insights/the-ansoff-matrix-a-powerful-tool-for-business-strategy-and-growth
• Tikhonova, M., 2021. Financial Analysis of Walmart and Costco in 2017-2018. SCIENTISTs, p.100. https://www.mdis.uz/uploads/repository/6c6ad7db76e60dcb7f2be9801172123b.pdf#page=101
• Turner, A., 2022. Walmart vs Amazon: How Walmart can Compete with Amazon in the Age of E-Commerce. https://scholarworks.uark.edu/finnuht/74/
• Weinstein, A.T., Anti, K. and Ochoa, E., 2022. World’s biggest retailer launches Walmart Plus and customers have their say. Journal of Business Strategy, 43(6), pp.381-390. https://www.emerald.com/insight/content/doi/10.1108/jbs-07-2021-0133/full/html
• wikipedia.org, 2025. TOPIC RELATED TO Walmart Logo. Viewed on 10th June 2025. From, https://en.m.wikipedia.org/wiki/File:Walmart_logo.svg