Walmart has strengths that are related to the size of its business. With the help of these strengths, Walmart makes its way to success through the threats it faces, despite its weaknesses. Its strengths for global growth can be listed as:
- Global organizational size
- Global supply chain of Walmart provides business flexibility from market-specific risks.
- Moreover, due to the advanced technologies for monitoring and controlling the movement of products from suppliers to its stores, Walmart’s supply chain has a higher efficiency.
The weaknesses of Walmart are directly related to its generic strategy. The cost leadership generic strategy used by Walmart leads to the following weaknesses:
- Thin profit margins
- The cost leadership strategy makes Walmart’s business model easy to copy.
- The firm does not have significant competitive differentiators, except for its business size.
Walmart’s opportunities include expansion and improving business practices. These opportunities are strongly linked to the global economic situation. In addition, the issues presented by the human resources situation in the organization also act as opportunities for the firm to improve. Walmart’s opportunities comprise of the following:
- The high-growth economic condition of Walmart contributes to its opportunity of expansion in developing countries.
- The HR practices of Walmart directly relate to the criticisms of the company’s employment practices.
- Improving quality standards helps Walmart to address consumers’ concerns about the health effects of using low-cost and sometimes low-quality products.
Walmart’s business faces threats that are related to the retail market condition and the variation of consumer perceptions about the products they purchase. Due to these factors, the company must make some competitive strategic changes. The threats to Walmart are:
- Other large retailers can use aggressive marketing and strategies to attract some of Walmart’s customers, which makes the aggressive competition a threat for Walmart.
- The healthy lifestyle trend is a threat as well as an opportunity.
Small-scale or individual online selling is a threat against the company’s retail business, as they use their own websites to sell products to online consumers with the help of Internet.