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Walmart - Deciding Locations for Braches

Essay by   •  December 10, 2010  •  Essay  •  780 Words (4 Pages)  •  1,856 Views

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INTRODUCTION

In the past, many manufacturers of best products and best service providers expect customers to come and knock at the door steps of their factory or organization just to be avail to avail of their high end products. It is now becoming very clear that having the best quality product brand in the market is not enough to guarantee consumer preference. If we will open a business, one of the most vital factor is business location factor where we will open the business. Good or not, a location determines the very success of a business. Compromising with less good location will never do the business any good.

DISCUSSION

Just like any business, Walmart takes its own steps in deciding locations of its branches. In the case given, It is even a deeper consideration whether moving into a small town shall be pushed through. Also, it takes a lot of evidences or encouragement for Walmart's chairman of the board to approve of the plan, especially that many people and businesses, alike, will be affected by the said "moving in" of Walmart.

Particularly, owners of small businesses located nearby will still be bothered by the very fact that a larger establishment of higher variety and can offer the people of the town products at cheaper prices. The specific consequences of Walmart moving in the small town are as follows:

● Additional Competition

Given the unchanged number of population and the increased number of establishments offering relatively same set of products, the market covered by the smaller businesses has to be even reduced to make way for the upcoming tough competition.

● Lower Demand

It is expected that as Walmart moves in, the existing businesses will find it more difficult to attract consumers. This is because of the perceived higher quality of the products offered by the multinational corporation, like Walmart. Also, the existing establishments are to be threatened by the relatively low prices of the products that Walmart is offering.

● Lower Survival Rate

Given the potential decrease in sales, correspondingly, it will become more difficult for the existing business to sustain an income that makes it feasible for them to continue operating.

However, despite the given consequences, it is also certain that Walmart will bring certain benefits to the town, especially to the existing small businesses. some of which are as follows:

● More Accessible Supplier

For the establishments within the town who purchase products and further sell them to the end consumers, Walmart moving nearer their area is an opportunity. They do not have to farther just to be able to buy their supplies.

● More

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