Wal Mart Capabilities

In: Business and Management

Submitted By bosko27
Words 354
Pages 2
Wal-Mart Capabilities One of Wal-Mart’s capabilities would be its satellite system. Once Wal-Mart began to grow consistently it found a need for communications between stores and distribution centers, which is where the satellite system came into play. The system made it easy for managers to analyze what merchandise was moving slowly and what merchandise was being sold the most in various stores. This way, Wal-Mart could prevent overstocking and helped with inventory control. The satellite also helped tremendously with communication to headquarters and to the distribution centers, which is another capability. Wal-Mart created its own distribution centers to help save costs from deliveries from suppliers. The distribution network started with a Wal-Mart truck bringing merchandise to a distribution center, which is then delivered to a Wal-Mart store. By having these distribution centers, Wal-Mart is able to devote only 10% of its square footage in its stores to inventory, compared to the industry average of 25%. This means that the majority of the square footage in a Wal-Mart store is dedicated to the merchandise on the floor, being sold to customers. When relying on suppliers to deliver merchandise, it is up to the supplier in how quick they are capable of delivering the goods. However, when using its own distribution center the timing is ultimately up to Wal-Mart. A third capability of Wal-Mart would be its “everyday low prices”. Not only is Wal-Mart able to offer low prices to its customers, but also they are capable of offering the lowest prices, which is something Wal-Mart has always thrived on. When Wal-Mart is located near one of its competitors it lowers its prices even more compared to when it is in a location not by a Kmart or Target. This shows the competitive nature of Wal-Mart, that they want to attract more customers than its competitors…...

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