Essay on Case Study Walmart

1274 Words Nov 27th, 2007 6 Pages
I. Introduction

Wal-Mart is a world-wide active American retail trade company and currently the largest retail company in the world. Beginning in 1962, Wal-Mart has made the transition from a small firm in Arkansas to the largest employer with 3, 800 store units in the United States with record revenues today. But nevertheless, since Wal-Mart launched its online branch, it had to suffer from substantial setbacks from competitors such as Amazon.com or Ebay.
The intention of this case study is to evaluate Wal-Marts.com's profitability of success regarding its situation in 1999.

II. Discussion Questions
II.1 What is the impact of Wal-Mart.com on customer-borne transaction costs?

Wal-Mart's business philosophy is based on the simple
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Amazon.com and Ebay have been a threat to Wal-Mart.com ever since it was launched. Nevertheless, Wal-Mart has considerable advantages in brand recognition, buying power, and technology. According to the article from Wendy Zellner none of the other e-tailing leaders have the financial heft Wal-Mart possesses. Burt P. Flickinger III of Reach Marketing states that "Wal-Mart can take tremendous volume discounts that it gets and apply that to an Internet pricing model that no current or future Internet company could possibly hope to challenge."(When Wal-Mart flexes its Cyber muscles, W. Zellner, ll.31-32)
Wal-Mart.com will be able to secure Wal-Mart's position as a price setter creating higher barriers to entry in the off- and online retail sector, thus capturing value. Superior factors of production in terms of cooperation with experienced companies such as Hewlett Packard or Fuji and an advanced project management will yield extra value for Wal-Mart. The so called bricks ‘n clicks integration, where Wal-Mart.com is directly connected with the local stores, will directly link both, the offline channel and online channel. Another factor which will capture value is the fact that customers and the experience gained from using Wal-Mart.com can be used for Wal-Mart.

II. 4 Should Wal-Mart have pursued e-commerce more aggressively sooner?

According to experts, you have to get in early and big to succeed in E-commerce. Wal-Mart.com

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