Wal-Mart Operations Wal-Mart\'s Has Grown to Be

Wal-Mart

Operations

Wal-Mart's has grown to be one of the most powerful organizations in the world and its biggest assets is it powerful retail brand name. The company has branded itself as the low cost leader in their industry and consumer perceive the brand as offering value for money, convenience and a wide range of products all in one store (Marketing Teacher, N.d.). Although Wal-Mart does not produce many goods internally, it offers a retail service that connects suppliers from all over the world with consumers via its network of retail outlets. Wal-Mart is known for its dedication to providing retail goods the lowest prices possible to consumers in their industry. Wal-Mart has some of the most sophisticated supply chains and distribution networks available and the company creates value through quantities of supply.

Supply and Demand

There are many factors that influence Wal-Mart's ability to achieve equilibrium in supply and demand. Some of the most recent issues that is affecting the sales that the company will be able to achieve in the current quarter will be items such as higher payroll taxes, income tax refund delays, and higher gas prices (Hsu, 2013). The delays in income tax refunds as well as higher gas prices both affect their consumer bases level of disposable income while the payroll tax increase causes the company to incur additional expenses. However, since Wal-Mart is the low cost leader in the market, during macroeconomic problems the company can see an increase in many of the goods that it sells. This is primarily due to the fact that cash strapped consumers will gravitate to Wal-Mart's low cost position.

There are many issues that can affect the company's retail supply levels as well. Since the company's supply chain consists of somewhere around the neighborhood of a hundred thousand suppliers or more the company has a significant amount of exposure to regional issues. For example, one issue that Wal-Mart has been dealing with lately is a fire that occurred in a Bangladesh factory that was owned by a subcontractor of Wal-Mart who was manufacturing private label clothing for the company (Raza, 2013). This fire killed over one hundred employees and was responsible for a significant amount of negative publicity for the company.

Not only did the fire in Bangladesh disrupt the supply chain for that individual product line, but it also caused much wider supply chain disruptions. It is difficult for Wal-Mart to have a significant amount of control over the entire supply chain given the sheer magnitude of the number of suppliers in which it does business with. Wal-Mart has to trust its suppliers and subcontractors to run their own operations in regards to Wal-Mart's expectations. However, many of these suppliers operate unethically in regard to Western standards. Therefore, when the fire occur this put additional pressure on Wal-Mart to more closely monitor the activities in their supply chain that were conducted by subcontractors.

Wal-Mart's Recent Performance