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Wal-Mart The Unstoppable Case Summary November 17, 2006

Posted by Laxmi Goutham Vulpala in case studies, MBA.
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 Sam Walton founded Wal-Mart in 1962, when he opened a store in Rogers Arkansas after a disagreement with the board of Ben Franklin about their discounting strategy. Since then Wal-Mart has had a phenomenal growth to become the biggest retailer in the world, As of October 31, 2006, the Company had 1,100 Wal-Mart discount stores, 2,176 Supercenters, 574 Sam’s Clubs and 110 Neighborhood Markets in the United States. It also has expanded globally to almost every part of the world, and had  sales of  $316 billion and net income of  $11.2 billion for year ending January 2006.

Successes and Mistakes
Sam Walton’s Management style of treating employee’s as partners and associates; sharing profits and providing free flow of ideas in the initial years set the base for the growth of Wal-Mart in the later years.

Their State of the art of the supply chain management system tied to all their suppliers and instant tracking of all their sales allowed them replenish the goods quickly on their shelves. By passing middlemen to allowed them to lower their cost structure, and help gain a competitive advantage.

In their initial years after inception, Sam’s strategy of expanding in small towns largely ignored by the big-retailers allowed them to gain a foothold and gained market share and eventually made them unbeatable even in the big cities

In spite of all the huge success in the domestic market, their international expansion has not been as good. Due to the cultural differences they could not successfully replicate their successes. In addition the negative publicity generated because of the jobs losses caused by expansion of Wal-Mart and their lower pay structures for their employees are causing communities to oppose their further expansion.

Lessons Learnt

Taking good care of the employees, and passing the value back to customers with cost-savings achieved by being frugal, will help a company immensely.

Looking for and identifying underserved markets, which ignored by major companies provide new entrants with a strategy to get a foot hold in the market it provides breathing space before taking the competition to the bigger and more lucrative markets.

Bad public image can create backlash against the company and even more so against the larger ones, so care needs to be taken in the initial stages and enough money spent on creating a positive image.

Source (Marketing Mistakes and Successes)


Vihaan’s 2nd Birthday November 14, 2006

Posted by Laxmi Goutham Vulpala in Uncategorized.
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Today is Vihaan’s second birthday, He was surprised and felt shy when he woke up and we sang “Happy Birth Day” to him in the morning. He looked at the banners and said, Vinnu Khush Khush

 Took off from work today so we could go to temple and get some shopping done for the party over the weekend.

Vanguard Success November 10, 2006

Posted by Laxmi Goutham Vulpala in case studies, MBA, Powerpoint Presentations.
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Here is a 30 min case presentation delivered by me a few other teammates that list the reasons for tremendous success of Vanguard.

 Vanguard Presentation

Newell Rubbermaid Destroys a Growth Mode – Case Summary November 2, 2006

Posted by Laxmi Goutham Vulpala in case studies, Uncategorized.


Newell Rubbermaid was formed in 1999 when Newell acquired Rubbermaid, a competitor for $6.3 billion. Prior to the acquisition until the 1990’s Rubbermaid was growing very strongly with the stock routinely returning 25% annually, but it began faltering in mid 1990’s partly because of its inability to meet the service demands from Wal-Mart its major customer. Newell specialized in buying small marginal firms and improving their operations, it focused on buying firms that had a strong brand name but mediocre customer service.

Newell’s assessment was that Rubbermaid was a troubled company and by improving its operations and customer service up to Newell’s performance standards they could enhance the profitability and deliver value to the shareholders. Newell’s plans never materialized after the acquisition as it could not turn around quickly which led to the tanking of stock price leading to a loss of around 50% of the company’s value.

Newell underestimated the problems at Rubbermaid prior to the acquisition, though they used a similar strategy of acquisitions earlier, the size of these firms was small compared to the size of Rubbermaid. Rubbermaid’s on time delivery problems to their biggest customer Wal-Mart surfaced in 1995, in spite of spending around $62 million in technology they could not appreciable improve their delivery provides the most damning indictment of its operations. Newell’s eagerness to acquire a strong brand caused them to overlook the deficiencies at Rubbermaid and overestimating Rubbermaid’s value and synergies the merger would offer.
Lessons Learnt

Rubbermaid did not provide adequate service to its biggest customer Wal-Mart and took too long to correct the situation. When dealing with big retailers Brand Name only goes so far, meeting their service and delivery standards is absolutely essential for the success for a manufacturing company.

Big acquisitions should not be done in haste; enough research needs to be done about the state of the company being acquired and the potential savings and synergies that will result from the acquisition.

Once the firm retracts from growth mode it is difficult to get back on track as it is evident from Newell Rubbermaid, which even after the hiring a high-profile marketing CEO could not turn around the company.
Case Source (Marketing Mistakes and Sucesses Hartley)