And why Wall-Mart keeps getting stronger? Smart Smart was a chain of store discount department in the USA, Virgin Islands, Puerco Rice, and Guam. There is Smart stores also in Australia and New Zealand although the stores have no relation to the stores in the USA. Mission Statement We are committed to improving the lives of our customers by providing quality services, products and solutions that earn their trust and build lifetime relationships’.
Smart SOOT Analysts Strengths -Strong store name brand -Loyal customers -Great customer service -Good efficiency on it’s supply chain -Their operational margin was two times the average of supermarkets -Great food quality (perishables) -Huge variety on products Weaknesses Grocery store was too big to look for things -Expensive prepared food -Not too many locations -Being a private ownership store limits store expansion due to capital Opportunities -More locations -Develop private labels -Growth in higher margins Threats -Competitors like Wall-Mart and Target -Inability to absorb price increases due to smaller scale vs. other competitors – Economic down turn affecting the customers economic status Smart Strategy The strategy that Smart tried to set in place was working closely with their marketing and merchandising departments, there was also a huge investment in television impassions and glamorous representatives such as Jackal Smith, (former Charlie’s Angels) who has her own line of cloths for Smart. So, in other words, Smart strategy consisted mostly in advertising and remodeling their stores. Smart did not adapt to changes in the marketplace, this was one of the reasons that Smart had to go to the bankruptcy in addition to that, Smart had a series of bad management decisions. The business community could not understand why such a great store name like Smart company could have been completely devalued. Wall-Mart At the beginnings of Wall-Mart, Sam never thought that he could compete with a store s big as Smart.
Smart was way ahead of the game, it had almost the double of stores than Wall-Mart where Smart had 2,223 discount stores Wall-Mart had 1,198. While Smart sales were $25. 63 billion, while Wall-Mart had $15. 96 billion. Big red “K” logo had great visibility for advertising in addition to that its large urban presence. Although Wall-Mart had a more consistent record of earnings and revenue growth, in the eyes of many experts it had never played in the major leagues. Unlike Smart, whose stores sat on expensive urban real estate and competed against other big counters, Wall-Mart sat in pastures outside small towns and picked off the customers of aging mom-and-pop shops.
To present time Wall-Mart Stores operates numerous retail store formats in Argentina, Brazil, Canada, Chile, China, Costa Rica, El Salvador, Guatemala, Honduras, India, Japan, Mexico, Nicaragua, Puerco Rice, and the I-J. Mission Statement ‘We help people save money so they can live better. ‘ Wall-Mart -A market leader like no other -It is the largest discount store in the world -Low cost retail store -International -Have not been able to penetrate metropolitan areas in the US -It has over 60 wage- Opportunities -Take the retail store leadership in China and India -having variety of food and organic food could bring more revenue due to the fact that people are getting healthier every day and looking for fresh organic food. Emphasize on the internet sales to be able to grow even more and quicker Threats -Too many employees like Wall-Mart has it increases the cost in health and insurance payments -Volatility in prices, cost inflation and rapid changes -Resistance from the competitors Wall-Mart Strategy According to Wall-Mart executives there are three types of shopping. 1 Stock-up session, which brings families to Walter’s 3,200 nationwide Superstructures. 2. – Basic grocery run, when shoppers want to go someplace nearby and more navigable, such as one of Walter’s 300 “neighborhood markets. ” 3. -eliminated access stop, when shoppers head for the traditional convenience store.
Bill Simon describes this 3 types of shopping as an “ecosystem” Cross-Case Analysis Based on the information obtained by the SOOT analysis for both retail stores, Smart and Wall-Mart we can pin-point the SF of each. Critical Success Factors Smart-SF wall-Mart- SF Strong Name Brand Largest Discount Store in the World Huge Selection of Food Products Low Cost Retail Store Great employee benefits and good compensation policy Globalization Similarities They both have low prices, the store look very similar, the name Smart and Wall-Mart resemble each other, their mission statement is along the same message, and customer service they both strive for the best. Differences The biggest difference between this two stores is the adaptation to change.
I believe that this was the key strategy that Smart did not acknowledge. In addition to that, there is also a huge difference in the sales volume and the number of stores round the world. Conclusion At this point we all know that Smart is slowly going out of business and Wall-Mart is quickly growing. Smart never updated their inventory tracking system, whereas Wall-mart invested millions of dollars on their tracking system, this could be another breaking point for Smart, not being able to track their inventory and replenish as the shelves went empty like Wall-Mart does was the start of the down fall, losing numerous customers to Wall-Mart where the customer could always find what they look for.