Strengths, Weaknesses, Opportunities and Threats of Walmart
The Internal Strengths of a company are what makes them who they are, also they are what contributes to the success of that company. Some of the internal strengths of Walmart, according to Smithson and SWOT Analysis, are:
- The largest retailer in the world- Walmart is the largest retailer and employees the most people in the world. This contributes to reputation and allows them to be everywhere for their customers
- Global expansion- Walmart is in 22 countries over the world. This gives them an advantage in their overall revenue and profit.
- Inventory and Distribution Systems- Walmart has distribution centers all over the world so each store can get their inventory a lot faster.
- Different types of stores and networks- Walmart has a variety of stores from supercenters, neighborhood markets, club stores, and small stores. This allows for a variety for its customers.
- Online shopping- online shopping is a new experience for Walmart customers. With this new addition to Walmart they will be an even bigger force in the retail business.
- Technology- Walmart uses technology in their company to keep things speedy and accurate. Walmart uses tools in their company to keep their inventory up to date and to keep up with sales. (Ex. Mc40’s and inventory scanners).
The weaknesses of a company are also what describes them. The weaknesses of Walmart, according to Smithson and SWOT Analysis, are:
- Public Image- Walmart has been known for their poor public image because of things like: not treating employees right, destroying local stores and communities, and not being ecofriendly.
- Treatment of employees- Walmart has been known for not treating employees right. Some example are employee wages, employee benefits, and hours.
- Local communities- Walmart is known to be the destroyers of local store and communities. That gives them a bad reputation.
- Not flexible- Walmart’s stores have the same items in all stores. They really can’t base their items off of what sales in that part of the community.
- Profit- Walmart makes a lot of money, but they decreased in profit margin by 7.2% from 2016 to 2017. (SWOT 2018)
- Competition- Walmart has competitors in retail such as Amazon, Target, Sears, ETC.
External opportunities are part of the external environment which focuses on opportunities and threats. Walmart’s External opportunities, according to Smithson and SWOT Analysis, are:
- Form Strategic alliances Form alliances with other strong companies, a chance to increase revenue and profit
- New locations- new locations equals more customers, which contributes to more money.
- Continue current strategy- just keep doing what they are doing, just adapt to what needs to change here and there.
- Expanding in more countries- even though they are in 22 countries already being an expandable company can get them even more money and power.
- Technology Technology can increase anything in the business’s everyday doings. It allows for the company to be more effective and efficient.
- Online shopping- Walmart just started the online part of their company. They need to keep the online part updated and keep advertising it to bring it more attention.
- Expanding the inventory- Walmart has a lot of merchandise already, but if they can keep expanding their inventory they can become even more of a powerhouse. This will allow them to increase their customer base.
Threats can be anything to the company that can take away from their business or effect it in a negative way. The threats to Walmart, according to Smithson and SWOT Analysis, are:
- The target of competition- Since Walmart is the top-dog and everyone is coming after them. They base what they do to compete against Walmart.
- Political problems in other countries- since Walmart is in so many countries, they have to abide by 22 different sets of laws and government regulations.
- Price competition- Walmart has to deal with prices for the same product from different companies. Since they have a price match guarantee they have to give customers the lowest price and it could end up effectively being a negative thing.
- Small business Vs Walmart the small businesses of the world try to be negative about Walmart and its effect on them.
- Profit- Walmart had a decrease in profit. Profit is always a big thing for businesses.
- Employee unions- Since Walmart had rumors about not treating their employees right, then the employee unions are a threat to Walmart.
- Tariff taxes- since Walmart has locations overseas, they will have tariff taxes on imports and exports.