... In this note, we give some tips on how to undertake a five forces analysis and apply
the framework to an analysis of the discount retailing industry as described in WalMart Stores Inc. ...
Supplier Power — Low
_ WalMart keeps individual suppliers to less than 2. ... , Gitano) are very dependent on their WalMart account. ...
_ WalMart features services and characteristics (greeters, etc. ...
Threat of Substitutes —Low
_ Department Stores (Sears, ZCMI) – higher prices, greater service
3
_ Catalog Sales – similar prices, less service
_ Warehouse Clubs – lower prices, less service
_ WalMart is an attractive alternative for price-concious consumers
Rivalry—Low (Implied by limited threats from the other forces.)
_ KMart and Target have much more contact with WalMart than WM has with them. ...
Supplier Power — Uncertain
_ Increasing partnering between WalMart and its suppliers will restrict WalMart’s ability to
bargain heavily with suppliers. ...
_ KMart may be trying to leapfrog WalMart in the supercenter retailing format.
_ The market contact between KMart, Target, and WalMart is increasing.
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