Strategic Audit Of Wal Mart Essay

2685 words - 11 pages

Strategic Audit of Wal-MartOverview and General Performance -The Wal-Mart Corporation is divided into three segments, those being Wal-Mart Stores, Sam's Club, and the International Division. The Wal-Mart Store segment is by far the largest sector of the organization actually accounting for 68% of sales (based on figures compiled on Jan 31, 2004 regarding sales figures from 2003). This area of business consists of all of the domestic business with the exception of Sam's Club.The beginning of Wal-Mart was the birth of a phenomenon that no one planned and no one expected. Founder, Sam Walton opened the first store in 1962 by introducing the first discount-shopping-department type store in a rural area. His philosophy clearly was to bring affordable merchandise and products to people in rural places who might not have access to them otherwise. This thinking proved to be incredibly successful and profitable. Within seven years of the opening of that first store, Wal-Mart became incorporated. One year after that the first distribution center was opened, and the corporation became public on the New York Stock Exchange.By the year 2000, Wal-Mart earned the discount of "Retailer of the Century" (Discount Store News, Nov 8, 1999). In addition, the corporation became one of the "Most Admired Companies in America," (Fortune Magazine), as well as one of the "100 Best Companies to Work For", (Fortune Magazine). In spite of all of these accolades, Wal-Mart has not developed a formal written mission statement because they believe that their primary focus is meeting the ever changing need of the customer. By continuing to provide a way for people, "common folk," to have the same access to brand name, and popular products at a discounted price, with stores in neighborhoods and other convenient locations, Wal-Mart has become an American icon and institution. Wal-Mart has essentially conquered the small-town, Midwest, farm communities of America and strives on continued public and customer service, and positive contribution back to the communities in which it resides.Financial comments and analysis - -In millions of U.S. DollarsBased on 12 months as ending 1/31/2004Revenue 256,320Other Revenue 2,352Total Revenue 258,681Cost of Revenue 198,747Gross Profit 57,582Admin Expenses, etc total 44,909Total Operating Expenses 243,656Operating Income 15,025Interest Expense/non-operating (996)Interest Invest Income/non-operating 164Interest Income/net non-operating (832)Net Income before taxes 14,193Allowance for income taxes 5,119Net Income after taxes 9,075Minority Interest (214)Net income before extras 8,861Discontinued Operations 193Net Income 9,054Wal-Mart has enjoyed consistent growth since the beginning. In the year 2000 they had revenues of $165,013. In 2002 revenue increased to $217,799 billion. This was during a time when the nation's economy was still reeling from the economic downturn caused by the terrorist attacks of 9/11/2001. Revenue increased as their growth...

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