Wal Mart Case Analysis using Porter's Model Study

Wal Mart Analysis using Porter's Model - Case Study Example This helps in improving the supply chain and lowering the cost of distribution. Third competitive advantage is its advanced technology of data mining. With the help of data mining, they are able to gather useful data for the suppliers, improves customers satisfaction with the help of accurate demand forecast. The cost is reduced as there is no excess of inventor. The forth competitive advantage is Wal Mart work force culture. It values more for the customers; it is not compromised in any ways. The stores are able to response quickly to the changing demand. Lastly it’s the EDLP (everyday low price). With the help of EDLP customer satisfaction is improved through low price. The advertising cost is also reduced and steady price improves the supply chain (Quelch, p.189-192). The individuals can easily shift to some other competitors who offers product at a lower price than Wal-Mart. But the consumers will lose the convenience with the organization. Thus the power of consumer is me dium. Entry barriers for new players are high compared to its competitors due to high initial set up costs such as distribution channels and this is because Wal-Mart has good distribution systems, huge brand name. Wal-Mart has an absolute cost advantage. Therefore the threat of new entrant is low. Threat of substitute is low as there are not many companies which offer low pricing and convenience. The customers may switch off to other speciality stores but they would not find the low pricing strategy of Wal-Mart.