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Walmart

Case
Wal-Mart Stores, Inc.: On Becoming the World's Largest Company (2002)

I. CASE ABSTRACT

Wal-Mart Stores, Inc., in 2002, with corporate headquarters in Bentonville, Arkansas, was not only the nation's largest discount department store chain, but also had surpassed Sears, Roebuck & Company as the largest retail organization in sales volume in the United States. It was also considered the largest retailer in the world. The firm operated stores under a variety of names and retail formats including: Wal-Mart, discount department stores; SAM'S Clubs, wholesale and retail membership warehouses; Neighborhood Markets, small grocery/drug store formats; and Supercenters, large combination general merchandise and grocery stores. In the international division, it operated stores in Canada, Mexico, Argentina, Brazil, Germany, United Kingdom, Puerto Rico, South Korea, and China. The McLane Company, a support division with over 36,000 customers, was the nation's largest distributor of food and merchandise to convenience store and selected Wal-Marts, SAM'S Clubs, and Supercenters. Sales for the year ending January 31, 2002 were approximately $218 billion, making Wal-Mart Stores, Inc. the largest company in the world as measured by annual revenue.

A major concern was Wal-Mart's spectacular growth and the dominance of the firm in the market. The firm was perceived to be in the accelerated development or growth stage of the institutional life cycle in which sales are increasing rapidly, profits are high, new stores are being opened, existing stores are being refurbished, the product line is being reevaluated, service offerings are being upgraded, automation is being introduced to store operation, and better management controls are being developed. What makes this situation unique is that the discount department store industry was perceived as being at maturity. The industry faced increased competition, leveling of sales, moderate profits by surviving firms,...