Wal-Mart in Africa

Wal-Mart in Africa
Case Code: BSTR428
Case Length: 15 Pages
Period: 2011-2012
Pub Date: 2013
Teaching Note: Available
Price: Rs.400
Organization: Wal-Mart
Industry: Retail
Countries: Africa
Themes: Globalization, International Business, Emerging Markets
Wal-Mart in Africa
Abstract Case Intro 1 Case Intro 2 Excerpts

Background Note

Wal-Mart was founded in 1962 by Samuel Moore Walton (Walton) in Rogers, Arkansas, USA. Walton worked at JC Penney Corporation, Inc. before starting Wal-Mart. He also ran a franchise of Ben Franklin stores . When working with other retailers and later running a franchise, the conviction grew on Walton that the changing buyer behavior in the US made discount stores the future of retailing, especially in the smaller towns. He traveled across the US before starting his own discount store and was convinced that Americans wanted a new type of discount store which would offer more discounts than the traditional discount stores.

Wal-Mart was founded on the principle of passing on the discounts that retailers could manage from the wholesalers to the consumers and making money through the higher volumes achieved. Walton's business clicked and Wal-Mart made better profits than many of its competing stores. By 1967, Wal-Mart had 24 stores with sales of US$12.6 million. By 1968, it had expanded to Oklahoma and Missouri. Wal-Mart was incorporated as a company under the name Wal-Mart Stores, Inc. in 1969.

Wal-Mart achieved significant growth during the 1970s. It opened its first distribution center and Wal-Mart Home Office in Bentonville in the first year of the decade. In 1977, Wal-Mart acquired 16 Mohr-Value stores based in Michigan and Illinois - its first acquisition. Wal-Mart expanded its business into other retail formats in 1978 and set up pharmacy, auto service center, and jewelry divisions. In 1979, Wal-Mart's annual sales reached US$ 1 billion and it became the first company to reach that goal within the quickest time. It had expanded its stores to 276 by 1980. In the years 1981 and 1982, Wal-Mart entered new states in the US like Georgia, South Carolina, Florida, and Nebraska and expanded its reach....

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