Walmart Analysis of Its Competitive Advantages

Walmart’s success stems from that fact that it doesn’t have just one competitive advantage, it has many competitive advantages. The main strategy behind Walmart is “Everyday-low-prices”. They offer the lowest prices by cutting out the expenses that other retailers are known for. Large companies can offer luxurious stores and tailored customer service but all of that comes at a price; a price that CEO decided was an acceptable compromise in order to reduce prices. Sam Walton, who was the founder of the Walmart stores, believed in cutting costs everywhere. Every expense should be followed with profitability, even business trips.

Another competitive advantage behind Walmart was their effective way of merchandising their items through traiting. Walmart was very aware of which products were selling more than others and was able to profit from that. They were familiar with the customer needs and the seasonal demands of the product. This was a huge advantage over competitors that were not as advanced because Walmart has less items sitting in inventory and thus were able to turn their products over fairly quickly.

“Happy employees equal happy customers”. Walmart was also known for being “one of the top 100 best companies to work for in America”. Walmart treated very well and offered compensation packages and stock ownership. Walmart is interested in the suggestions and opinions of its associates using them as a link between upper management and the customers. This allows Walmart to improve its stores and practices to better suit the customer. These are some of the things that Walmart “got right” and were able to become a phenomenal success.