Walmart Case Essay

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Corporate and Business Strategy: Team Case 2 Date: 3/8/2009 Re: Competitor Analysis: Wal-Mart Company and Dell After a thorough analysis focusing on key strategies of Wal-Mart and Dell, which are outlined in the following pages, our final conclusion is that many of their competitive advantages cannot be easily replicated. However, several of their successful strategies outlined below could be implemented to help make XYZ companies more profitable. Matching Dell Between 1994 and 1998, Dell Computer Corporation grew twice as fast as major competitors in the personal computer market. Dell achieved this feat by successfully implementing the “Direct Model,” a strategy relying on the direct delivery of customized PC’s at a relatively low price. Competitors quickly recognized Dell’s success; however, none were able to successfully restructure their operations to reach the profit levels that Dell achieved. Demand for personal computers began to grow in the mid-nineties due to strong economic growth and the emergence of new computer network services. However, low average profitability was common in the PC market. PC makers were faced with the challenge of developing a PC that consisted of the major components that consumers desired. This was a very complex task considering the numerous combinations of hardware and software components available. Competitors were often unable to successfully develop a strategy that minimized the high manufacturing, carrying, and inventory costs associated with the product life cycle. Computer makers often focused on minimizing one associated cost instead of fully integrating a system that considered lowering every expense. Also, technology was constantly changing throughout this time period. PC competitors were constantly investing capital into new products and services to remain competitive in the market. The high
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