Post on 13-Jan-2016
transcript
How to Compete & Thrive in a Walmart World
KEY ITEM PROMOTION
“Picking Walmart’s P.O.C.K.E.T.S”
SESSION #3
What YOU think about most of the time . . .
Is what you become!
Sam Walton’s Secret:
I do not choose to be a common man !!!
Sam Walton’s Secret:
“What is the key to Sam Walton’s strategy for selecting products and services for
Walmart’s Stores?”
Merchant Strategy Question:
“Sam Walton used an outside-in approach to gather product
ideas.”
Answer:Answer:
Outside / In
1. Study competitors copy BP
2. Ask supplier partners
3. Collect ideas from employees
4. Ideas are free, “steal shamelessly”
Why Outside / In
Innovation
Versus
Imitation
Saturday Morning Meetings
Product Presentations
by the Buyers
Customer Centered Focus
Every WalMart Employee is expected to think like a
Retail Merchant
Merchant Mentality via VPI
Volume
Producing
Item
Vendor PartnershipVendor Partnership
Information Sharing
Trust Based Partnerships
Automated Replenishment
VendorvilleNo 3rd Party Brokers
Meetings at WalMart HQ
1000+ Suppliers
3 KINDS OF
WALMART
SUPPLIERS
Walmart’s Buyers Negotiate on behalf of Customers
No Gift Policy
Demand “The WalMart Price”
Vendors must improve efficiency
Demand In-Stock Execution
Hurricane Hurricane KatrinaKatrina
“Walmart’s trucks arrived in New
Orleans days before the United States
Federal Government!”
Weather Technology
Snow Storms
Hurricanes
Store Wars
“The battle for the Carts and Minds of
Consumers”
Store Wars Between:
Retailers Horizontally
Walmart & Vendors Vertically
The Weapon - Private Label
Store Wars Between:
Scan Based Trading
“Pay Per Scan”
“One Stop Shopping”
In-Store “Non-emergency Care” Clinics
Pharmacy Design
Optical Center
Hair Salon
Auto Repair
Groceries
General Merchandise
Financial Services
Retail Marketing “5 P’s”
Product
Price
Place
Promotion
People
Retail Marketing Segmentation StrategyHispanic
Asians
Empty Nesters / Baby Boomers
Affluent
Suburban
Rural
Merchandising Execution
The Wheelbarrow
Merchant Ideas For You
Use an Outside / In approach
Copy best practices of others
Allow people to be merchants
Never forget: The customer is the boss
How to Compete & Thrive in a Walmart World
EXPENSES
“Picking Walmart’s P.O.C.K.E.T.S”
SESSION #3
Expenses“How important is expense control to Walmart’s overall
retailing strategy?”
Sam Walton
Answer:Answer:
“The success of Walmart’s Every Day Low Price (EDLP) strategy is made possible by
driving costs out at every step of the supply chain.”
Expenses“Every time Walmart
spends a dollar foolishly, it comes out of our
customers' pockets.”
Sam Walton
“Walmart executives, managers and employees are
cautious when it comes to spending money!”
“Being cheap is valued at Walmart”
“Walmart’s relentless pursuit of low prices is as
much a result of controlling expenses as it is a result of their buyer’s ability to buy
at low prices.”
“They pass expense savings along to their customers”
Walmart’s People Greeters
Theft control specialists
Expense ControlExpense ControlOffice Supplies & Profit SharingOffice Supplies & Profit Sharing
Paper usagePaper usage
Overtime BudgetOvertime Budget
No Headcount Increases No Headcount Increases
RelocationRelocation
Executive TravelExecutive Travel
Technology – Temperature of StoresTechnology – Temperature of Stores
The Sam Walton Way “Expense
Control Standards”
“Get employees to manage expenses like they were
personally writing the check”
Leading Expense Control
“Sam Walton was absolutely fanatical about controlling
expenses”
Expense Control LessonsExpense Control LessonsThe Walmart WayThe Walmart Way
As volume rises – expenses go downAs volume rises – expenses go down
Lead by your own exampleLead by your own example
Focus on the small thingsFocus on the small things
Culturally integrate cost controlCulturally integrate cost control
Measure, review and rewardMeasure, review and reward
Expense Control Ideas For You
Lead by your own example
Asked staff to spend like they were writing the check
Offer incentives for meeting expense goals?
Questions
?????????Join My LinkedIn Group
www.michaelbergdahl.net
How to Compete & Thrive in a Walmart World
KIP / EXPENSES
“Picking Walmart’s P.O.C.K.E.T.S”
SESSION #3