Walmart- a business giant, the king of discounts and the largest retailer in the world. This sentence describes a business started from a small franchise store in Newport Ark. More than 70 years ago. The man standing behind the largest store chain in the world is Sam Walton, a man who changed the way we see business today.
Franchise five-and-dime stores or the years before Walmart
It is important to note these years when Sam Walton was running his franchise stores, as this was what triggered him to start searching for an innovative business model, which will break the market. Commenced in 1945, until 1960 Sam Walton already had 14 franchise stores. At this time he reached the idea of a discount model, which will increase profit through the highest volume of sales. His suppliers denied his idea, didn’t wanted to lower their prices, so Sam dove into the deep waters of his own business.
The first Walmart stores
The year was 1962, the place Rogers Ark., and Sam opened his first Walmart store. Sam’s retail model is something unique, as the person standing behind it. Before risking his savings, Sam had already researched the market looking for the best discount retail practices. Another important point of his strategy is the decision to open stores in small living areas with a fewer population. This backed up his success since the location of the warehouse was and still is the important premise.
Today 90% of all Walmart stores are within 15 minutes walking from people’s homes.
Walmart’s trademark is the payment it guaranteed to its employees. This is one of Sam Walton’s now-hows to ensure proper payment for his employees, therefore make them happy and loyal to the business. One more of Walmart’s notable examples of good business practice is hiring a few people as possible, but paying them more.
Within the next seven years, Walmart expanded from 1 to 6 stores. By 1969 Walmart was on the stock exchange market, selling at a price $47. Meanwhile, the chain was an innovator not only in retail but technologies as well. The brand used computers to for data information exchange between the different stores. Computed calculations helped Sam to optimize his business, and decrease losses, due to miscalculations.
Acquiring smaller companies
What a company already running on the stock market is moving forward buying smaller companies to enlarge its chain. By 1974 Sam Walton ran 18 Walmart stores. Walmart’s biggest advantage- the low prices, was applied to the new departments the retail chain added. With the acquisition of more small businesses, jewelry, pharmacy, and even auto service departments opened.
Biggest competitor on the market
Another ten years have rolled. In 1980 Walmart had stores in the half of the Sates. With the company expanding fast and the attractive discounts, Walmart was the biggest rival of small stores. Throughout these 20 years of business success, Walmart had become a leader, using its influence to transform the market, through marketing initiatives. As early in 1985, Sam Walton decided to launch his first “Made in America” initiative, to stimulate American suppliers to produce more products and lower the price. This is an action still running; you can even now see products labeled “Made in the USA”.
In 1998 Walmart invested in its first supercenter while having nearly 2000 stores in the country. In the next years, the chain opened stores and supercenters first in Mexico, then in Hon Kong, Canada, Argentina, Chile, UK, and Brazil. They reached $ 100 billion annual sales and soon became the largest private-run company in the world.
After the millennium Walmart moved to another level investing in energy efficiency programs. They launched several experimental stores, which used only renewable energy, installing large solar modules, wind turbines and other environmental- friendly infrastructure.
Today Walmart has over 2.3 million employees, 11 695 stores all over the world and the astounding number of $ 482 billion.