Walmart Porter's Five Forces Analysis

Decent Essays
Register to read the introduction… Even if there is another competitor that offers the same product at a lower price, both Wal-Mart and Target guarantee a price match.
The last two forces, substitutes and rivalry, were difficult to distinguish because there are not any other companies that offer the variety of goods that Wal-Mart and Target do (groceries, clothes, toys, etc.). The most prominent substitute is online retailers such as Amazon, but our society’s need for instant gratification nullifies this threat as with online purchases you have to wait to receive shipments.There are businesses that rival individual departments such as Harris Teeter (grocery) or Dick’s Sporting Goods (sporting goods), but there is no other all-encompassing superstore that can rival these.
When looking at rivalry in a departmental context, it is the biggest threat in Porter’s Five Forces because businesses like Harris Teeter or Dick’s Sporting Goods offer higher quality products and more expertise in their customer support. To sum up, Wal-Mart and Target have a firm grasp on the industry and only rivalry threatens their
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Within the last few years Wal-Mart has cut back on their workforce and at times you’ll come across product holes on shelves.
Merchandise Quality
4
Target and Wal-Mart are selling most of the same products. Target differentiates itself by having nicer clothing offerings, and carries some higher-end items.
Suburban Convenience
3
In most suburban areas you will find both a Target and a Wal-Mart. Target’s business model focuses more on these consumers but Wal-Mart still has its stores there too.
Selection Within Categories
4
Both stores offer a similar selection but Target tries to have more exclusive content than Wal-Mart. Clothing lines are a good example.
Sales Help
4
Target appears to offer much better help to consumers through their employees compared to Wal-Mart
Ambience
4
Target stores appear cleaner and the red/white color scheme gives its stores a brighter and more modern appearance.

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One can also say that Wal-Mart implements a differentiation strategy as a secondary strategy. Wal-Mart strives to be a one-stop-shop for all consumer needs. This is evident by the wide range of products and services found in the Wal-Mart stores. A few examples of how Wal-Mart provides a deeper assortment of goods compared to competitors include auto services, as well as supplies and equipment for hunting. Providing such an assortment of goods provides consumers with the convenience of fulfilling all of their needs in one place, which can be considered another competitive advantage of Wal-Mart.
The generic strategy which Target is pursuing is differentiation strategy in which they aim to provide customers with a high quality of goods. Target strives to offer a unique assortment of products through their design partnerships, portfolio of owned Target owned brands, as well as an organized selection of signature national brands. Target has also recently expanded on their “Year Round Price Match Guarantee” policy to combat against online competitors to give consumers the best

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