This video will analyze Walmart company using a SWOT analysis. It will discuss the key Walmart strengths, weaknesses, opportunities and threats that affect the company in 2018, which might help you get a better understanding about the Walmart and its business.
The most important strength Walmart has is being the largest retailer in the world, with unmatched scale of operations and strong market power over suppliers and competitors.
Walmart is the world’s largest company by revenue and the largest retailer in the world. The company is a retail market leader in the U.S. and is a major competitor in all geographic markets in which it operates.
What does ‘being the largest retailer in the world’ mean to Walmart? Economies of scale; Efficient and effective use of resources; Huge gains from implementing best practices; Experimenting with less risk; Market power over suppliers and competitors.
As for the disadvantages, Walmart’s major weakness is overdependence on sales from the domestic U.S. market.
Walmart’s sales from its domestic operations (includes Walmart U.S., Sam’s Club and other revenues) were US$380.580 billion in 2018. In 2018, 76.1% of all company revenue and more than 85% of its operating income came from the U.S.
Walmart’s reliance on sales from one market weakens the company, as decreasing demand in the U.S. may seriously affect the company’s growth.
Let’s move on to the opportunities and the key opportunity for Walmart is the e-commerce market, which is forecast to reach US$4.5 trillion by 2021.
The e-commerce market is expected to expand significantly faster than the traditional retail sector, from US$2.290 trillion in 2017 to US$4.479 trillion by 2021, a growth rate of 95.6%. Based on these forecasts, e-commerce will account for 14% of total retail sales by 2020.
Most of Walmart's ecommerce businesses are experiencing strong growth in e-commerce, especially in the U.S., China and the UK. Therefore, the company should focus on improving its e-commerce capabilities to take advantage of the growing online shopping market.
One of the threats that affect Walmart is a growing risk of data breaches.
For almost every transaction, the company collects customers’ credit or debit card information, either through in-store payments or online. It stores that credit/debit card data and protects it from theft. Nonetheless, data breaches can occur and customer data does get stolen and exposed from time to time.
With the growing number of data breaches, there is always a potential risk of Walmart being breached again.
These are the key Walmart SWOT strengths, weaknesses, opportunities and threats. If you’d like to access many more of them, please visit our website https://www.strategicmanagementinsight.com/swot-analyses/walmart-swot-analysis.html and purchase the Walmart SWOT analysis from there.
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