Wal-Mart's Cost Leadership Strategy

While continuing its aggressive expansion in the food business, the company started launching innovative programs to further penetrate the US markets. For instance, in 2001, Wal-Mart launched a program, called 'Store of the community.' Under the program, Wal-Mart began remodeling its discount stores and Supercenters in the US to fulfill the needs of customers they served, in line with what the customers wanted. Explaining the program, Tom Coughlin, President and CEO of Wal-Mart Stores Division, said, "The one-size-fits-all concept simply doesn't work anymore in the retail industry. Customers tell us what they want and it is our responsibility to meet those needs. Our store associates live and work in each store's community and interact with over 100 million customers each week...

The company plans to achieve this by expanding aggressively in international markets. In the US, Wal-Mart plans to increase its store count and to introduce new product categories. The company plans to increase the total number of stores in the US from 3,400 to 5,000 in the next five years. By 2008, Wal-Mart plans to open 1,000 Supercenters in the US. Analysts and media reports are expressing doubts as to whether Wal-Mart will be able to achieve its ambitious $500 billion revenue target. Given the size of its operations, some analysts felt that Wal-Mart may also face the danger of anti-trust suits. However, not all analysts agree on this issue, as Wal-Mart enjoys significant customer support, and the customers are the ultimate beneficiaries of low prices...