Gloabal Market
Andy Martinez ISCOM/472
Wal-Mart has implemented lean initiatives to increase profits even before the economic downturn. In 2005, the company implemented a plan to target wealthier consumers—outside of their normal blue collar clientele—with a more modern marketing campaign (Kabel, 2006). The company also began stocking more high-end merchandise to cater to this group of consumers (Kabel, 2006). In order to stay in business, a company must work to increase business during good economic times as well as bad. The combination of the two strategies Wal-Mart has used (just in time and targeting a wealthier customer base) shows that the company knows how to adapt to changing markets; they have awareness of what lean initiatives to implement during economic upswings as well as downturns. In addition to managing a changing market through business lean initiatives, Wal-Mart also focuses on meeting strategic goals to increase the bottom line for the company. One tactic the company started implementing involves opening stores in more urban areas. However, the stores will be much smaller than the typical 150,000 square foot “big box” model. These “Smallmart” stores will allow the company to enter areas where large open areas are few and far between .This strategy allows the company to access a previously unobtainable customer base as well as bring jobs to places with high unemployment and fresh food options where not many exist. The store plans to implement the smaller store format in Chicago, San Francisco, Detroit, and New York.
Another lean initiative would be that Wal-Mart implemented to meet just in time goals involves bringing products back to the shelves. Over 8,000 products were returned to stores—many in grocery and consumable categories—and positive results followed soon after .Wal-Mart’s US CEO Bill Simon explained the strategy and results
Wal-Mart has implemented lean initiatives to increase profits even before the economic downturn. In 2005, the company implemented a plan to target wealthier consumers—outside of their normal blue collar clientele—with a more modern marketing campaign (Kabel, 2006). The company also began stocking more high-end merchandise to cater to this group of consumers (Kabel, 2006). In order to stay in business, a company must work to increase business during good economic times as well as bad. The combination of the two strategies Wal-Mart has used (just in time and targeting a wealthier customer base) shows that the company knows how to adapt to changing markets; they have awareness of what lean initiatives to implement during economic upswings as well as downturns. In addition to managing a changing market through business lean initiatives, Wal-Mart also focuses on meeting strategic goals to increase the bottom line for the company. One tactic the company started implementing involves opening stores in more urban areas. However, the stores will be much smaller than the typical 150,000 square foot “big box” model. These “Smallmart” stores will allow the company to enter areas where large open areas are few and far between .This strategy allows the company to access a previously unobtainable customer base as well as bring jobs to places with high unemployment and fresh food options where not many exist. The store plans to implement the smaller store format in Chicago, San Francisco, Detroit, and New York.
Another lean initiative would be that Wal-Mart implemented to meet just in time goals involves bringing products back to the shelves. Over 8,000 products were returned to stores—many in grocery and consumable categories—and positive results followed soon after .Wal-Mart’s US CEO Bill Simon explained the strategy and results
References: Kabel, M. (2006). Retailer Faces Bruised Image, Makes Fixes. Marketing News, 40(1), 25.