Walmart Three Year Strategic Plan

It is a public limited company that was started in America and runs many large discounts departmental stores. According to its website, it has been named the largest company in terms of revenue according to Fortune Global 500. Therefore, it draws one attention to investigate what makes it to retain this position and to investigate the manner in which it will achieve its following three years strategic plan while keeping up with coming up with new products and services are maintaining its competitive advantage. Executive Summary Company History The company opened its doors to customers in 2/7/1962 where it was I started by Sam Walton in Rogers Arkansas with a major intention of saving people’s money and assisting them to live better lives.

The company was operating under the slogan of “save money, live better” which has been its major objective to this day. In this, the prices of its products are relatively very cheap and its product line is exceptional; its presence in over 30 nations globally is unparallel and the global promotional advertisements done on nearly all platforms. This makes the company be a household name. Mission Statements The company operates under the vision statement of,” To be the best in the hearts and minds of its customers and employees. ” This is because it has grown to become the largest retailer hence earning the hearts and minds of its employees and customers. As it is felt across the world, it has created jobs for many and has partnered with many suppliers making everyone on board to benefit from it.

This is due to them failing to match the lower prices it was offering. “Opening point prices “is another strategy that has attracted many consumers to Wal-Mart (Brea-Solis, Casadesus-Masanell, & Grifell-Tatje, 2014). Here they feature product that is meant to make the customer to think that all products in that line have lower prices, which in fact they are not. This creates a mileage for them to dominate in customer retention and attraction. SWOT ANALYSIS Strengths Wal-Mart is known as the world largest retailer in the food industry The corporation has a huge presence globally and it concentrates on lowering commodity prices daily It has the largest employer rates with its associates reaching to the extent of 2. So in overcoming this, Wal-Mart concentrates on offering lower prices that give them an edge over its competitors.

Wal-Mart also many other offer so that they can lure customers. Bargaining Power of Suppliers This is quite low at Wal-Mart as it is a giant firm across the world. The services at Wal-Mart ensure that they give supremacy to its suppliers (Soderquist, 2016). This ensures that they are in great position in negotiating well than other competitors. Operational Planning Financial Performance In the evaluation of Wal-Mart financial performance, there is the calculation of financial ratios so that the health of this global company can be assessed. The company, however, ensures that it uses the principle of not using the risk-return trade-off in their calculation. This makes them know how liquid Wal-Mart is and how is the company achieving its return on investment.

In measuring liquidity, it uses these two formulas Current ration= current assets/current liabilities Acid test ratio= (current assets-inventory)/current liabilities (Brea-Solis, Casadesus-Masanell, & Grifell-Tatje, 2014) In assessing the liquidity of Wal-Mart, this means how easy current assets are being converted into cash. Average collection period=accounts receivables/ daily credit sales Accounts receivable=sales/365 (Brea-Solis, Casadesus-Masanell, & Grifell-Tatje, 2014) Accounts receivable turnover=credit sales/accounts receivable Inventory turnover= cost of goods sold/inventory (Hicks, Keil, & Spector, 2017) In managing Wal-Mart financing assets Debt ratio=total liabilities/total assets (Hicks, Keil, & Spector, 2017) Times interest earned=operating income/interest expense (Brea-Solis, Casadesus-Masanell, & Grifell-Tatje, 2014) Operating income=pre-tax income plus interest expense Operating income=pre-tax income +interest expense (Brea-Solis, Casadesus-Masanell, & Grifell-Tatje, 2014) Operational Budget and Assessment In budgeting and reconciliation of the financial information, at Wal-Mart, they use non-GAAP financial measure for purposes of releasing them to the general public.

It involves getting into new markets and selling to them in disregard to its existing portfolio of customers. For example, setting up new subsidiaries in order to set up more stores to achieve market development (Soderquist, 2016). Wal-Mart concentrates on creating new subsidiaries overseas in order to tap consumers located in those places. Product Development The company concentrates on this strategy though in minimal concentration as it involves creating new products. The main focus of this kitty on product development is channeled towards sales and marketing (Sorescu, Frambach, Rangaswamy, & Bridges, 2016). This means that the structure with two characteristics that is hierarchy and function-based definition (Hicks, Keil, & Spector, 2017). The hierarchy pertain the vertical lines that indicate the chain of command and authority across the entire Wal-Mart Corporation.

The apex is the chief executive officer and the other levels all have a superior. This means that all the directives and authorities come from the managers at the top levels. At the middle level, it is where a lot of management is done. So at this company there is a belief of ‘respect of individuals’ makes Wal-Mart to achieve the implementation of an “all understandable component of the organizational structure (Meeks, & Chen, 2016). ” References Brea-Solis, H. , Casadesus-Masanell, R. , & Grifell-Tatje, E.  Business Model Evaluation: Quantifying Walmart’s Sources of Advantage. Wal-Mart: The face Of twenty-first-century capitalism. New York: New Press. Matusitz, J. , & Reyers, A. A Behemoth in India: Walmart and Glocalisation. T. , Singh, J. , Rangaswamy, A. , & Bridges, C. Innovations in retail business models.