Name: Muhammad Talha Hassan
S.W.O.T Analysis Assignment
Walmart VS Target
Wal-Mart’s SWOT
Strengths
Weaknesses
Opportunities
Threats
#1 retailer worldwide
Labor related lawsuits
global retailer
Wide range of products
High employee turnover
Expand grocery
department
Organic Products
Cost leadership strategy
Little differentiation
Online shopping growth
International operations
in 27 countries
Negative publicity
Retail market growth in
emerging markets
Increasing competition
from brick and mortar
and online competitors
Rising commodity
product prices.
Increasing resistance
from local communities.
Strengths:
o
o
o
o
# 1 retailer worldwide. Wal-Mart has been one of the largest retailers in the world.
Wide range of products. Wal-Mart offers a wider range of products than any other retailer. It
sells grocery, entertainment, health and wellness, apparel and home related products among
many other categories and offers both branded and own label goods. Wide range of products
attracts more customers to Walmart stores.
Cost leadership strategy. This strategy has helped Walmart to become the low cost leader in the
retail market. It sells products at much lower prices than competitors do, builds warehouse style
superstores that contain extensive range of products but doesn’t offer much additional benefits
or services. All of this result in cost reductions and lower prices for consumers.
International operations in 27 countries. Wal-Mart does not rely on sales from US stores only as
its competitors do. It has earned $135 billion in sales in 2013 from its international operations,
which grew at a much faster rate than sales in the home market.
Weaknesses:
 Labor related lawsuits. Walmart faces labor related lawsuits every year, which costs millions of
dollars for the company. It is criticized for poor work conditions, low wages, unpaid overtime
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work, and female discrimination. In addition to litigation costs, corporate’s reputation has been
damaged and fewer skilled workers are willing to work for it.
High employee turnover. The business suffers from high employee turnover that increases
firm’s costs, as it has to train new employees more often. The main reason for high employee
turnover is low skilled, poorly paid jobs.
Little differentiation. Walmart has no differentiation compared to its competitors, which might
hurt the company in the future if commodity prices or average consumer income would
increase. In this case, low cost leadership strategy wouldn’t be as effective as it currently is and
Walmart’s main competitive advantage would erode.
Negative publicity. The company is often criticized for its questionable practices such as bribery
of authorities or poor work conditions. Negative publicity damages corporate are reputation.
Expand grocery department. Wal-Mart needs to expand their grocery department so that they
can more products in it.
Opportunities:
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Retail market growth in emerging markets. Retail markets grew by at least 5% on average in
emerging markets in the last year, opening huge opportunities for Wal-Mart’s revenue growth.
Wal-Mart also has to increase its presence in these markets to sustain future growth.
Organic Products: The growing demand for healthy and organic food options opened a new
avenue for Walmart to explore and grow their presence
Online shopping growth: Wal-Mart offers a sophisticated online store which provides the
shoppers the convenience of shopping from the comfort of their homes.
Threats:
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Global retailer. As a global retailer, Walmart is exposed to political problems in the
countries and regions where it is currently operational.
Rising commodity product prices. Rising commodity prices squeeze Wal-Mart’s profit margins
and erode its competitive advantage. As prices go up, the cost difference between the retailers
decreases and competition shifts from price to product and service differentiation.
Increasing resistance from local communities. Wal-Mart superstores have a negative impact on
local retailers and communities. Some of the local retailers are usually forced to close off when
Wal-Mart superstore opens in the area. This affects not only the retailers but their families and
the community as a whole.
Increasing competition from brick and mortar and online competitors. Competitors like Target,
Costco, Amazon and Tesco (in UK) are putting huge efforts to eliminate price differences that
Wal-Mart enjoys. Except the lower prices, Wal-Mart doesn’t differ from other low cost retailers
and will experience increased competition from them in the future.
Target SWOT
Strengths
Weaknesses
Opportunities
Threats
Higher quality and
innovative products
Not as many locations as
other companies
Expand in international
markets
Appearance of their
stores.
Limited visibility in
international markets
Price matching of online
retailers
Target products are
more expensive as
compared to
competitors.
Target Corporation
should focus on cost
cutting to reduce the
prices of products.
Increase market share
It provides very good
shopping environment
for the customers
Target Corporation
brand awareness is low
as compared to WalMart.
It lack of labor Unions.
Brand Awareness
program need to
formulate.
The interest rates
increasing with increase
in government taxes.
Terrorism is increasing;
security is the main
concern of the
customers.
The current recession
possibly divert the
customer from high price
products to low price
products.
Credit card business with
financial economic
turmoil
Formulation of labor
Union is required to
increase employee
satisfaction.
Macro conditions
affecting its core
shoppers who are
trading down to other
stores
Target Corporation is the
second largest retailer
after Wal-Mart in US.
I believe the Wal-Mart company is stronger than the Target based on SWOT because first the Wal-Mart
is number one retailer company throughout the worldwide and also they have more shores then the
target. The other thing is that the Wal-Mart company has a cost leadership strategy which helped WalMart to become the low cost leader in the retail market; in other hand Target products are more
expensive as compared to competitors. Also, the important thing is because of heaving high quality
products in less cost, so most people prefer to go in Wal-Mart rather than in target.