Walmart Business Enviroment
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At Wal-Mart, growth has been guided by a scheme of focusing their financial and human resources in areas where they can release the most value. Their results clearly exhibit that this is the right strategy. Last year, they opened seven new Wal-Mart Supercentres in Canada. The response from their customers has been excellent, and they plan to open 21 new supercentres soon. They also added 120 new stores in Mexico and are very convinced by the performance and continued growth opportunities for all six store formats there. Asdas turn-around strategy continues to deliver results.
While store development and expansion has experienced significant growth, it is not the only measure of success. The division has posted impressive financial results as well. Wal-Mart International announced that 2007 fiscal year end sales reached $77.1 billion, a 30.2 percent increase over the previous year, and that operating profit rose to $4.2 billion, an increase of 21.5 percent over the prior year.
Despite obvious cultural and business challenges, Wal-Mart International has experienced success because of its ability to transport the companys unique culture and effective retailing concepts to each new country. The division makes a rigorous effort to adapt to local cultures and shows interest in the local community.
Wal-Mart has effectively implemented a strategy seeking to lower costs and deliver products and services with minimal inconvenience. This is being achieved through reducing costs, controlling energy consumption by monitoring and controlling lights, heat and A/C or even controlling inventory efficiently. Wal-Mart has also successfully incorporated ease in their strategy, as some stores are open 24-7, and as they offer multiple services, it can be said that they are effectively becoming a one stop shop.
About 40% of products sold in Wal-Mart are private label store brands. Wal-Mart began offering private label brands in 1991 with the launch of Sams Choice, a brand of drinks produced by Cott Beverages exclusively for Wal-Mart. Sams Choice quickly became popular, and by 1993 was the third beverage brand in the United States.
When it comes to the financial results, Wal-Mart delivered a solid performance. They had record net sales of $345 billion, an increase of 11.7 percent over fiscal year 2006. Their net income from continuing operations rose 6.7 percent over last year to a record $12.2 billion. Furthermore, Wal-Marts international sales increased by over 30% to $77 billion for the year.