Wal Mart Stores Inc has acquired a number of companies that helped it in diversity and development of its item's profile. This is the detailed explanation of the Porter's design of five forces of Wal Mart Stores Inc Business, given in Exhibition B.
Competitiveness
Wal Mart Stores Inc is one of the top company in this competitive industry with a number of strong rivals like Unilever, Kraft foods and Group DANONE. Wal Mart Stores Inc is running well in this race for last 150 years. The competitors of other business with Wal Mart Stores Inc is quite high.
Threat of New Entrants
A number of barriers are there for the new entrants to happen in the consumer food market. Just a few entrants succeed in this industry as there is a need to comprehend the consumer need which requires time while current rivals are well aware and has actually advanced with the consumer loyalty over their items with time. There is low hazard of new entrants to Wal Mart Stores Inc as it has quite large network of circulation worldwide dominating with well-reputed image.
Bargaining Power of Suppliers
In the food and drink market, Wal Mart Stores Inc owes the biggest share of market needing higher number of supply chains. This causes it to be an idyllic purchaser for the providers. Thus, any of the supplier has never expressed any grumble about cost and the bargaining power is also low. In action, Wal Mart Stores Inc has actually also been worried for its suppliers as it believes in long-lasting relations.
Bargaining Power of Buyers
Hence, Wal Mart Stores Inc makes sure to keep its customers satisfied. This has actually led Wal Mart Stores Inc to be one of the faithful business in eyes of its purchasers.
Threat of Substitutes
There has actually been a fantastic threat of replacements as there are replacements of some of the Nestlé's items such as boiled water and pasteurized milk. There has actually also been a claim that some of its products are not safe to use resulting in the decreased sale. Hence, Wal Mart Stores Inc started highlighting the health benefits of its products to cope up with the alternatives.
Competitor Analysis
It has become the second largest food and drink market in the West Europe with a market share of about 8.6% with just a distinction of 0.3 points with Wal Mart Stores Inc. Wal Mart Stores Inc draws in regional clients by its low cost of the item with the regional taste of the products preserving its first place in the international market. Wal Mart Stores Inc company has about 280,000 employees and functions in more than 197 countries edging its rivals in many regions.
Keep in mind: A brief comparison of Wal Mart Stores Inc with its close competitors is given in Exhibition C.
Exhibit B: Porter’s Five Forces Model
