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Essay / Research Paper Abstract
This 3 page paper briefly explains Porter's competitive strategies and, using student-supplied sources, discusses the strategies Wal-Mart used to become so successful. Competing on capabilities is also reported. Bibliography lists 3 sources.
Page Count:
3 pages (~225 words per page)
File: MM12_PGwlmt3.rtf
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Unformatted sample text from the term paper:
strategic scope and strategic strength (Porter, 1980). Strategic scope is the demand side dimension and it is related to the companys target market and strategic strength is related to the
supply side dimension and is related to the companys core competencies or the strengths of the company (Porter, 1980). Interestingly enough, Wal-Mart has used the concepts of all three of
the generic strategies throughout its history. They have also focused on core competencies. Market segmentation is described as focusing on a target market, a niche market and then developing a
market mix that meets the needs of that defined market (Porter, 1980). When Wal-Mart first opened, the target or niche market was rural communities in the South (Moore, 1993). The
company expanded to other small communities of about 5,000 people, looking for locations that could serve more than one small community (Moore, 1993). Wal-Mart has also focused on cost leadership
since the beginning. Cost leadership is about efficiency (Porter, 1980). To compete based on cost leadership, companies might produce large volumes of relatively standardized products, goods that are produced at
low costs and it must have a large customer base (Porter, 1980). The goal is to take advantage of economies of scale (Porter, 1980). This is what Wal-Mart has done,
albeit, they do not produce the goods but they do employ cost leadership strategies. The stores began by offering products at prices that were as much as 15 percent cheaper
than their competitors, such as small family-owned retail stores (Moore, 1993). To use differentiation strategies, companies must create a product that is unusual or that is at least perceived as
being unique (Porter, 1980). Porter (1980) explained that the product that is viewed as unique must provide superior value for the customer (Porter, 1980). Customers need to see the product
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