Walmart Case Study

2141 Words9 Pages
0 1/2012009 TUE 1 4:45 P1 5 02 569 1270 ProQuest 1 XanEdu A . Wa1"Mart Stores, Inc. In Forbes magazine's annual ranking of the richest Americans, the heirs of Sam Walton, the founder of Wal'Mart Stores, h held spots five through nine in 1993 with 9 .5 billion each. Sam . , Walton, who died in April 1992, had built Wal*Mart into a phenomenal s u c c ~ with a 2 0 - par , a venge return on equity of 3376, a nd compound average s a l e growth of 35%. At the end of 1993, WalSMart had a market value of $57.5 billion, and its sales pcr square foot were nearly R O O, c ompard with the industry average of $210. It was widely believed that WalDMart had revolutionized many aspedv of retailing, and it was wcll known for its heavy investment in information technology. David Class and Don Soderquist faced the M e r g e of following in Sam Walton's footsteps. Glass and SoderquLt, CEO a nd COO, had been running thc company since February 1988, when Walton, retaining tlic chairmanship, turned the job of CEO over to Glass. Their record spoke for itself-the company went from sales of $16 billion in 1987 to $67 billion i n 1993, with earnings nearly quadrupling from $628 million to $ 23 billion. At the beginning of 1994, the company operated 1,953 Wal*Mart stores (mduding 68 supercenters), 419 warehouse clubs (Sam's Clubs), 81 warehouse outlcts (Bud's), and four hypermarkets. During 1994 WaleMart p l m e d to open 110 new W alDMxt stores, including 5 s uprcenters, and 20 Sam's Clubs, and to expand or relocate approximately 70 of the older Wal*Mart stores (6 f which would bc made into supercenters), and 5 Sam's Clubs. Salcs o were forecast to reach $84 billion in 1994, and capital expenditures were expected to total $3.2 billion. Exhibit I summarizes WalDMart'sfinallcia1 pcrformancc 1983-1 993. Exhibit 2 maps WaleMart's storc network. The main issue Glass

More about Walmart Case Study

Open Document