Wal-Mart operates more than 7,000 stores. (Wal-Mart Corporate Website) The corporate strategy of Wal-Mart is to sell everything people need at low price. As founder Sam Watson said, goal of Wal-Mart is to save people money so that they can live better. This is the focus that underlies everything Wal-Mart does. (Wal-Mart Corporate Website) Huge turnover, large customer base and returning customers show that Wal-Mart has been able to achieve this goal in its 50 years of existence.
Company Case: Costco Wholesale Corporation The price of food has skyrocket in the last couple of years. People are looking to save money and have resulted in buying in bulk products. Although there are a lot of Wholesale Corporation, we chose Costco because this is where we shop and found them to be cheaper than the other Wholesale Corporation. Costco began operations in 1983 in Washington, US. In the same year, the company merged with the Price Company, a US based retailer, to form Price/Costco, a Delaware company.
By having this speed Zara can introduce new designs weekly and every three to four weeks 75% of their merchandise is displayed, which matches the customers preferences more than competitors. Most of Zara’s products are sold at full price with half the markdowns in their stores than competitors. Zara’s retail stores have strict time to keep order placed and stocks received. Before the items are shipped they already have a price tag on them so they want be crowded at the store and encourage occasional
The airline industry in US has been challenged and many of firms were bankrupt. However, JetBlue Airways started to expand aggressively and remained profitable by insisting on its low-fare strategy. JetBlue has been published through initial public offering in April 2002, barely two years since established. The initial price range for JetBlue shares was $22 to $24, but facing sizable excess demand, the management increased the range as $25 to $26. After the whole process of IPO including SEC reviewing, road showing, book-building, pricing, tombstone advertisements, JetBlue finally launched in NASDAQ at $27/share as initial pricing, closed at $45 per share on the first day of trading.
Because of its efficient cost-saving strategies, Southwest's 37-year streak of profitability is unmatched in the airline industry. Here is a little information about its major competitors: • AirTran Holdings - is one of America’s largest low-fare passenger airlines. The airline has managed to achieve low operating costs despite relying on a hub-and-spoke system, in which most of its flights originate and terminate at its hub in Atlanta, Georgia. • American Airlines - the second largest airline in the world based on available seat miles and revenue passenger miles. On an
At KFC, they added a breakfast menu and lowered the price to match what local cafes were offering. This offered locals an alternative to traditional breakfast street food and also capitalized on the fact that there was a big increase in young urban workers. By focusing mainly on the employees in the local markets instead of centralized research, Yum was able to isolate and allow the workers to generate new innovative ideas. In each local market, the brand could focus on developing new items that were unique to their country, but still had to follow a set of guidelines of global standards which allowed Yum to reach economies of scale. By utilizing CHAMPS, Yum is able to maintain cleanliness,
Strengths Wal-Mart has a profusion of strengths which is apparent due to its outstanding success. This retailer is the largest in the United States and a place to get a respectable job without a college degree. Criticisms have been made how Wal-Mart pays low wages, but this still gives people jobs and being employed is important in this economy. Wal-Mart beats the competition by saving families hundreds if not over a thousand dollars a year with their aggressively low pricing strategy. Slashing prices as they have over the many years lures in consumers to bring in more sales.
Zara is extremely competitive compared to its competitors by producing 11,000 items compared to 2,000-4,000. Each season new collections are sent to the stores, each store receiving 12,000 units (8,000 for women’s, 2,000 for men’s’, 2,000 for children) in a one-week period. By having a large amount of merchandise shows that the sales associates are spending their hours sorting and organizing inventory. Zara’s emphasis on associates doing inventory and replenishment is having a huge impact on how efficient they are in managing their stores. Using these shift hours causes the employees to focus on the merchandise rather than the
Nowadays, people like to compare the goods between stores and online, they will buy the products on amazon for the low price. * Convenience: Bezos said that they do not make money from selling; they help people make better purchasing decision to make money. Amazon dedicated many resources to know what the customer wanted by offering customer review and feedback forms on all of its products (refer case study). Bezos invested a lot of money to establish operation center, even the operation scale is far beyond Amazon’s actual customer demand in that period. This enhances the customer experience greatly.
Customers who are loyal to a name-brand company are more likely to try the new product, as opposed to someone who is not loyal. For example, a popular burger place could offer a new smoothie drink at a premium price. Many loyal customers will purchase the new drink because they are pleased with the products they already buy from the company. Loyal customers also draw new customers for the company through word of mouth. Market Share A customer with a strong brand has a high market share because of its reputation, and this makes it difficult for new entrants to enter the marketplace.