Question for Business Types. Why has Wal Mart done so well?

Yeah, I know K-Mart is still in business but they are about 5% of what Wal Mart is in the big picture of things. For people who are familiar with both business models, whats the difference? Why did Wal Mart do so well, and K-Mart not? Why hasnt there been more competition for Wal Mart i.e..another large retailer opening up to take a chunk outta WMs consumer share?

I'm just curious. Share your thoughts.

Well, Walmart had gotten a firm grasp on the "great" reletivly new idea of monopolization.

You see, they buy out all the "mom and pop" stores. They completely overtake all other supermarkets. They locate themselves everywhere and force people to go there. It's a brilliant ideology of marketing but, unfortunetly, one that allows few others to take a piece of the pie. By removing the competition and locating yourself everywhere, you have created an iffalable system for creating a monopoly. Capitialism at work, baby. There is no way to stop it. Unless you vote Democrat that is. :p

Doc

P.S. By the way, I'm not a business type. This is just how I believe it works.

See:

http://www.duke.edu/~dat6/Wal-Mart.htm


Walmarts operations, just-in-time inventory, distrubtion hubs (i.e. if you plot the stores on a map, they form a big circle around a distribution center) and things you don't see are what maked them most efficient. They give consumers what they want.

Sam Walton wrote a book called "Sam Walton: Made in America," about his success. You could check that out.

BTW, the Waltons are #6, 7, 8, 9, and 10 on the Forbes list of the world's richest people. Well, technically, they're all tied at #6, but they're separate. Just a little interesting side note.

They all got their Bentonville bucks from Daddy. If Big Sam was still alive he'd be the world's richest man (way ahead of Bill Gates).

One of Wal-Mart's strengths lies in its buying power. They are so big that they can dictate terms to its suppliers (ie. how their products are produced and packaged) that make it most beneficial to Wal-Mart.

Like them or not, they have some excellent upper level management.

Walmart gives you more bang for your buck. They have better selections then K-Mart. They advertise heavily on their Jacqueline Smith and Martha Stewart lines, neither of which I would wear if they were free. Some places have Super Wal-Marts. My daughter is in York, PA and she does all her shopping at Walmart there. It has a grocery store, and for a kid in college saving money is everything.

We have a small Wal-Mart by us. I find it the most unappealing store to shop in. Crowded, narrow aisles, cheezy stuff. The prices might be good, but I won't go there unless I'm desparate. My mental state has a price. Same with Home Depot; too big, too messy, can't find anything, just mountains of stuff. Give me Mom & Pop.

My, they've come a long way from that mountain and the house with paper walls. Night, night John Boy.

The greater. It's all about the old man or woman at the door that keeps us coming back :p

I prefer Target, but their prices are slightly higher. Wal-Mart's success has been pointed out from an economic standpoint nicely by DonsAdvisor.

Wal-Mart, at least the closest one to 'us,' is quite unwelcoming to shop in. It seems to attract "riff-raff" and the eisles are overcrowded with pushy people. Not pleasant. There is one, a Supercenter, that is cleaner, and much more friendly to the customer located about 30-45 minutes away, but it also has more of a selection. It's fun to visit, but it's not my #1 shopping destination. I still prefer specific stores.

If I want a baseball glove to play 1st base (my position), I go to the local sporting goods outlet, or, for a bigger selection, the Dick's franchise.

If I want a new washer/dryer, I go to an appliance store.

If I want a new guitar, I go to a musicians shop.

I go to Wal-Mart if I want something quick, easy, and cheap (although they don't have girls...yet :p ).

uh, back to the topic, boys.

I'm a Walmart whore I just love it. So I must be part red-neck I guess....

I think their basic plan is high-volume sales. They don't make much on a single item sold, but they sell so much that they still profit a lot. I think that's what it is.

I like K-mart too but I don't think they have as much selection and their prices are higher. It's easier to find a parking space though and you can get in and out quickly. I like Target but they have even less selection. I don't like how the store is laid out at Target either, either.

I personally don't care for the mom and pop stores but I actually own one, so.... I try to make it as customer service friendly as possible.

Did anyone see the last episode of the new South Park? Boy, that was funny.

You sure those gloves are for your hands? [/b][/quote]lol, Part, you'll have to show me the 'proper' way to use a catchers mitt, you big stud. :p :p :p :p

Maybe this will solve Kmart's woes.

Kmart, Sears to Merge in $11 Billion Deal

By MEGAN REICHGOTT, Associated Press Writer

CHICAGO - The discount retailer Kmart Holding Corp. is combining with one of the most venerable names in U.S. retailing, Sears, Roebuck & Co., in an $11 billion deal that will create the nation's third largest retailer.

The company being created by the surprise combination announced Wednesday would be known as Sears Holdings Corp., but will continue to operate the Kmart and Sears stores under their current brand names.

The combined company is expected to have $55 billion in annual revenues, 2,350 full-line and off-mall stores, and 1,100 specialty retail stores. That will mean it will trail only Wal-Mart Stores Inc. and Target Corp. among the biggest U.S. retailers.

It will be headquartered in the northwestern Chicago suburb of Hoffman Estates, where Sears has its headquarters, but will maintain a "significant presence" in Troy, Mich., where Kmart is based.

Under the agreement, which was unanimously approved by both companies' boards of directors, Kmart shareholders will receive one share of new Sears Holdings stock for each Kmart share. Sears, Roebuck shareholders can choose $50 in cash or half a share of Sears Holdings stock. That portion of the deal values Sears shares at $11 billion, a 10.6 percent premium over its value at Tuesday's close.

Kmart chairman Edward Lampert will be the chairman of Sears Holdings, while Sears CEO Alan Lacy will be vice chairman and CEO of the new company. The new 10-member Sears Holdings board will have seven members from Kmart and three from Sears.

"The merger will enable us to manage the businesses of Sears and Kmart to produce a higher return than either company could achieve on its own," Lampert said in a press release.

The merger, expected to close by the end of March 2005, is subject to approval by Kmart and Sears shareholders, regulatory approvals and customary closing conditions.

Kmart filed for Chapter 11 bankruptcy protection in early 2002, leading to the closing of about 600 stores, termination of 57,000 Kmart employees and cancellation of company stock. The retailer emerged from bankruptcy in May 2003 and in March posted its first profitable quarter in three years.

Mired in a retail slump, Sears had long fallen out of favor on Wall Street after losing ground to competitors and enduring sluggish sales for years. The company last fall introduced its Sears Grand stores, which offer grocery and convenience items besides traditional Sears fare such as clothing, home appliances and tools. The concept had delivered promising results for the struggling retailer at its first three stores in metropolitan Salt Lake City, Las Vegas and Chicago, in the suburb of Gurnee.

Kmart, in recent years, has been shedding many of its underperforming stores, a strategy that has helped the once-struggling discount retailer bounce back after it emerged from bankruptcy. Kmart recently agreed to sell 50 stores to Sears for $575 million as part of that strategy.

Kmart's earnings have been improving. On Wednesday, Kmart posted its fourth straight quarterly profit. Its net income in the third quarter ended Oct. 27 reached $553 million, or $5.45 per share, compared with a loss of $23 million, or 26 cents per share, for the same period a year ago.

Its stock price has risen nearly seven-fold to $101.22 on Tuesday from $15 a share when it emerged from bankruptcy.

In recent weeks, it appeared that Sears could be shifting toward a similar real estate strategy after the disclosure that Vornado Realty Trust, a real estate investment trust, had purchased a 4.3 percent interest in the department-store chain. That move left the impression that the value of Sears' real estate holdings may be not be fully reflected in its stock price. Since that Nov. 5 announcement, Sears' stock has jumped 25 percent. It closed at $45.20 in trading Tuesday on the New York Stock Exchange.

Company officials said the merger would help make their properties more profitable through a broader retail presence and improved operational efficiency in areas such as procurement, marketing, information technology and supply chain management.

"The combination will greatly strengthen both the Sears and Kmart franchises by accelerating the Sears off-mall growth strategy and enhancing the brand portfolio of both companies," Lacy said. "This will clearly be a win for both companies' customers while significantly enhancing value for all shareholders."

The merger will not affect agreements to carry home and fashion lines including Martha Stewart Everyday, Lands' End and Sesame Street, the companies said.