A conversation with a representative from Procter & Gamble exemplifies the power Walmart had acquired. For example, he began requiring manufacturers to open offices near Walmart’s Arkansas headquarters. Walton was shrewd, and he was able to continuously beat competitors on pricing by using his growing company’s sales volume and financial clout to influence manufacturers. “The reason Walmart is a success is because they gave people what they wanted,” says Charles Fishman, journalist and Walmart expert. In 1991, Walmart began spreading around the world.Ĭonsumers flocked to Walmart stores, where they could rely on getting the lowest prices on products they bought every day, instead of expecting the price markups other stores made using the high-low pricing model. In 1980, just 18 years after the first store opened, Walmart had spread across the U.S. In 1972, the company’s stock began trading on the New York Stock Exchange. But I always had confidence that as long as we did our work well, and were good to our customers, there would be no limits to us,” Sam Walton said, according to a 1984 article from The New York Times. “I had no vision of the scope of what I would start. The model worked, and the company grew rapidly. Walton’s idea was to build big stores that discounted everything they stocked, and to place them in small towns.” “The practice wasn’t exactly new, but at the time, discount stores tended to be small, to be located in cities, and to only discount specialty items. “He decided to adopt a new strategy- discounting-dramatically cutting prices in hopes of undercutting his competition and making up the difference in price through a higher volume of sales,” Entrepreneur reports in a profile of Walton. Penney, Sears, Kmart and Woolworth’s, while following the pricing lead of the era’s small discount stores. He had worked in retail for years when he opened the first Walmart store in 1962 that started out as a single-location underdog behind J.C. He was an experimenter, thrifty money manager, a taker of opportunities and a dogged worker. Walton was a character who was known to pick up coins off the ground even after he was leading a multibillion-dollar company.
We’ll end the article looking to the future, with exclusive insight from Charles Fishman, world-renowned Walmart expert and author of “The Wal-Mart Effect.”Ī brief history of Walmart has to start with the story of Sam Walton, the entrepreneur who launched the phenomenon that, as of 2015, was still the world’s largest company. In the following pages, we’ll look at Walmart’s 1962 start as a fledgling business in Arkansas, its years of rapid growth and its newest initiatives. Knowing how the company goes to market, as well as its strengths and weaknesses, could be critical to your success. Plus, the company’s sales have been flat and, earlier this year, the retailer initiated its first large-scale closure of stores, shutting down 269 locations.īut Walmart is still a gigantic retailer, and regardless of what retail categories you sell, you are competing against this giant. The company, though, is no longer the innovator it was, trailing more nimble companies such as Amazon when it comes to capitalizing on e-commerce and using new technology in business. Today, Walmart is bigger than ever, and its 50-year-old retailing model still works. The company rapidly became an expert in buying huge amounts of merchandise, pressuring manufacturers to price products lower and lower and creating logistical efficiencies.
Starting in the 1960s, Walmart began turning retail upside down when it pioneered mass expansion of big-box discount stores.
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To view the complete PDF of this story, click here.īy Kate Klein, Sara Logel biggest traditional retailer has an impressive resume: logistics powerhouse, everyday-low-price pioneer, global influencer and billionaire maker.
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