Did you know that the world’s biggest retailer started out as a humble small-town store less than 70 years ago? Here, we will explore the visionary leadership of Sam Walton, the founder of Walmart, and the strategies he employed to build an empire.
From learning from established retailers to overcoming challenges in the digital age, Walmart's journey is a testament to the power of innovation and perseverance.
What is Walmart and What Do They Do?
Walmart is a multinational retail corporation that operates a chain of discount department stores and warehouses.
They provide customers with a wide range of products at affordable prices, making everyday items accessible to millions of people worldwide.
Walmart's added value lies in its commitment to offering discounts, exceptional service, and value-driven offerings.
How Walmart Started
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Sam Walton, the visionary behind Walmart, drew inspiration from his experiences working at JCPenney and managing five & dime stores.
Recognizing the potential of low-margin prices, he applied his learnings and transformed small-town stores into thriving businesses.
Walton's emphasis on cost-effective operations and efficient supply chains laid the foundation for Walmart's future success.
"Most everything I've done, I've copied from somebody else".
-Sam Walton
Becoming the Biggest Retail Store in the World
Walmart's growth strategy included aggressive expansion, both domestically and internationally.
By opening stores in strategic locations and leveraging economies of scale, Walmart rapidly expanded its footprint across the United States.
Additionally, innovative practices such as the use of technology, efficient inventory management, and a focus on customer satisfaction propelled Walmart to become the largest retailer in the world.
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How Online Shopping Posed a Challenge
As the retail landscape evolved, online shopping emerged as a formidable challenge for traditional brick-and-mortar retailers. Walmart, a 40-year-old company, faced the task of adapting to the digital age.
In 2015, for the first time since 1970, Walmart suffered its first decline in sales, which led them to take online sales even more seriously and heavily invested in acquiring several eCommerce businesses including:
- Jet.com for $3 billion in 2016
- Bonobos for $310 million in 2017
- Eloquii for $100 million in 2018
- ModCloth for between $50 million to $75 million in 2017
In addition, Walmart utilized its existing infrastructure and extensive network to its advantage.
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They invested in e-commerce, improved their online presence, and leveraged their physical stores as fulfillment centers, blending the convenience of online shopping with the benefits of a vast retail network.
90% of the people in the US live within 10 miles from a Walmart store, since 2013 they started testing a grocery pickup service. With this pickup method a new faster option opened to customers who didn’t want to wait for their packages to arrive.
According to “The Insider Intelligence E-Commerce Survey" conducted in June 2022 by Bizrate Insights, 42% of the people surveyed answered they've used Pick up at store or at the curbside as a delivery method for their purchase in the past month.
The success of Walmart's online retail strategy is evident in its results.
In 2020, Walmart witnessed an impressive surge of 79% in its US eCommerce sales, followed by a further 11.0% increase in 2021, fueled by substantial growth from the preceding year.
Subsequently, in 2022, Walmart experienced a noteworthy 12% rise in online sales.
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With online sales accounting for more than 13% of its total revenue, Walmart has now secured the position of the second-largest eCommerce retailer in the United States.
Value Growth Through the Years
Walmart's success can be measured not only by its financial growth but also by the positive impact it has had on communities.
The company has consistently focused on providing value to its customers, empowering employees, and supporting local economies.
Through job creation, philanthropic efforts, and sustainability initiatives, Walmart has established itself as a socially responsible global leader.
"If you want the people in the stores to take care of the costumers, you have to make sure you're taking care of the people in the stores".
-Sam Walton
A Global Powerhouse with Room to Grow
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The story of Walmart is one of resilience, innovation, and relentless pursuit of success. From its modest beginnings, the company has become an empire, transforming the retail industry along the way.
Sam Walton's visionary leadership and commitment to providing value to customers have been the driving forces behind Walmart's remarkable growth.
As the retail landscape continues to evolve, Walmart serves as an inspiration, reminding us that with the right strategy and determination, any business can overcome challenges and achieve great success.
