Wal-mart claims to have low prices always, and in the economy that's what Americans need, we need cheap affordable products. But as we saw in the video, Wal-mart will put say a coffee maker, on sale, on display where you have to walk by and see it. And this will make someone look at the coffee maker and say oh, its only $20 dollars, huh well my coffee maker is old I'll go and look at the coffee makers then. The customer will go and look at the coffee makers, see the one they want but its not a low price like the other one, it could actually be marked up. And the customer will assume since the other coffee maker was on sale and such a low price that this coffee maker must be a good deal as well and chances are buy it.
Walmart sells many items at ridiculously low prices. They are able to offer low prices on their items due to an incredible mark-up on imported products. Especially in today's economy, the buck is the big winner. Everyone wants to save money, and they can do that by shopping at Walmart, where many items are the lowest price in town, even if it's only by a few pennies. But consumers aren't helping their fellow countryman earn his own living by buying these imported items.
Nordstrom: How to Succeed by Selling One Shoe Identify the type of retailer that Nordstrom’s is classified as. Describe the characteristics it shares with other retailers of this type. Nordstrom is an upscale department store chain in the United States. Nordstrom was initially a shoe retailer, the company today also sells clothing, accessories, handbags, jewelry, cosmetics, fragrances, and in some locations, home furnishings. Nordstrom has grown from a regional department store to a national chain by opening store rather than by acquisition of other retailers.
Since the first manufacturer can produce the treated lumber without any additional input, they have absolute advantage over the other manufacturer and can be a price setter within the domestic market. The other manufacturer is limited by the amount of lumber it can purchase but has a better treatment facility so it cost less for them to treat their lumber. In this sense the second manufacturer has comparative advantage in producing treated lumber but their resources are limited by how much is harvested within the domestic market and thus they are price takers. However, suppose America opened trade relations with South America, a country with relatively low population density with desperate need for medical supplies and computer technology but covered with deep thick jungles. This new source of lumber is cheaper to harvest due to the massive quantities that allow the second manufacturer to stop buying the limited amount of lumber within its domestic market.
Through arrangements with suppliers, they are able to offer a large inventory of loose diamonds at low prices. Until a customer orders a stone, Blue Nile does not have to purchase it. Besides being able to have small inventories, this set up allows them to be paid by the customer before they have to pay suppliers. Using this cost saving supply chain also gave them the advantage of being able to set a markup price lower than competitors. The nature of their business model enabled them to enter the fairly new online market and compete based on lower prices.
Therefore manufacturers make bigger profit. As well as that, there are fewer factory regulations at sweatshops because the health and safety regulations aren’t as important in LEDC’s, that way it makes it cheaper to run the factory. As well as that, renting and buying the factory is cheaper too because the economy of LEDCS are weak the demand of buying property is low because not many people can afford it therefore buildings and houses are worth less because of low demand. Another reason clothes are manufactured in LEDCs is because there is less tax to foreign government, therefore there is a bigger profit for the manufacturers. Because LEDCs have a weak economy, there are very few
durable and lightweight shoes. Innovative technology: http://nikeinc.com/investors/news/nike-inc-introduces-2015-global-growth-strategy Product Adaptation -Such as in Japan where runners prefer shoes lighter and with a lower profile to the traditional designs made by Nike. --Nike ID: customize shoes and apparel ($100 m) Product Standardization Price Strategy -Price leadership strategy / value based -- Set the price based on the value the consumer places on the product. Nike spends lots of money to promote their image, and the consumer pays for it. -Lebron X - $315 -low income areas -- lower shoe prices $15 canvas shoes with swoosh Distribution Channels -Based in Beaverton, Oregon -Does not own any factories** -The three main product lines of Nike's brand - footwear, apparel and equipment - are made by approximately 600 contract factories that employ more than 800,000 workers in 46 countries around the world.
For example, they normally purchase a big number of merchandises from original manufacturers so they will be able to purchase it in very low prices. Then, people who would like to buy their products have to sign up to be store membership. The companies such as Sam’s Club, BJ’s Wholesales Club, and even Costco will allow just memberships to buy the products in low prices.
Thus, when comparing with other same level competitors like Adidas and PUMA, NIKE;s football jerseys has an advantage in lower price. Weakness: As it’s mentioned on strength, Nike has no factories by its own, it leads to the lack of quality at some level. We found in the survey, Users said that the jersey had poor durability, it could be torn easily. The organization does have a diversified range of sports products. However, the income of the business is still heavily dependent upon its share of the footwear market.
The company is based out of Germany and was founded in 1924 after WW1 by Adolf Dassler and his brother Rudolf Dassler. Each year before WW2 they were selling 200,000 pairs of shoes. Nike’s marketing strategy is an important component of the company’s success. Nike promotes its products by sponsorship agreements with celebrity athletes, professional teams and college athletic teams. From 1972 to 1982 Nike relied mostly on print advertising in highly vertical publications including track and field news.