The document discusses Walmart's strategy and business model. It summarizes that Walmart pursued a strategy of serving broad needs of many customers in narrow markets. Key elements of Walmart's activity system included efficient distribution networks, low operating expenses, centralized purchasing and inventory control. This fit of activities delivered competitive advantage through everyday low prices.
5. “ No question asked” Return Policy Computer-Aided Store Design Frequent performance Check Reduce “Shrinkage” More Incentives Improving Logistics Wired Merchandise Requests Direct Connection With Vendors Building Distribution Center (150~300 -mile radius) Diversification Small town ↓ Large town It’s Own Trucks and Trailers Quick Delivery & Using Return Trips Much less Inventory Satellite Network Measuring the success of Promotions Marketing On Lowest Prices Efficient Store Operations Focus on Increasing Awareness of New stores Takeover Specialty Departments Bargain-Basement Acquisition More Hard goods Increase in Sales per average ft 2 More Available Selling Space UPC at the Point of Sale Administration More SKUs Human Resources Management Testing Different Mixes Locating VPs in Same Area Everyday Low Prices Reduce Wage Expenses
6. WalMart’s Activity System Store merchandise In distribution center Providing “ Everyday Low Prices” Buy in volume at Attractive prices Centralized purchasing Inventory control Efficient Distribution network Low operating expenses Central computers Linked to vendors Hub and Spoke Distribution network Lease stores $20 million Satellite system Computer aided Design for Merchandise mix Regional vice Presidents live in Bentonville and Flown to stores Employee Salaries “ We care about Our people” “ No questions Asked” Return Policy Increased store Size and increase In the number of Store locations Computerized System in each store UPC at point of sale Store manager Salary. Autonomy in Ordering stock and Setting displays Efficient Inbound Logistics
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10. Business Model Template Brief Outline of Business Models / Nov 06 Alex Osterwalder / alex@arvetica.com
11. VALUE PROPOSITION value proposition 1 value proposition 2 … OFFER describing a company’s offer
12. VALUE PROPOSITION TARGET CUSTOMER value proposition 1 value proposition 2 … target customer 1 target customer 2 … CUSTOMER OFFER describing who a company offers value to
13. CORE CAPABILITIES VALUE PROPOSITION core capability 1 core capability 2 … value proposition 1 value proposition 2 … OFFER INFRASTRUCTURE describing what capabilities are required
14. describing what activities are required VALUE PROPOSITION VALUE CONFIGURATION CORE CAPABILITIES value proposition 1 value proposition 2 … core capability 1 core capability 2 … activity 1 activity 2 … INFRASTRUCTURE OFFER
15. VALUE PROPOSITION TARGET CUSTOMER CUSTOMER RELATIONSHIP value proposition 1 value proposition 2 … relationship type 1 relationship type 2 … target customer 1 target customer 2 … CUSTOMER OFFER describing the relationships a company builds
16. VALUE PROPOSITION TARGET CUSTOMER DISTRIBUTION CHANNEL value proposition 1 value proposition 2 … distribution channel 1 distribution channel 2 … target customer 1 target customer 2 … CUSTOMER OFFER describing how a company reaches its customers
17. TARGET CUSTOMER REVENUE STREAM revenue stream 1 revenue stream 2 … target customer 1 target customer 2 … FINANCE VALUE PROPOSITION value proposition 1 value proposition 2 … OFFER CUSTOMER describing how a company makes money
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20. VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIP TARGET CUSTOMER DISTRIBUTION CHANNEL VALUE CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS gives an overall view of a company's bundle of products and services portrays the network of cooperative agreements with other companies describes the channels to communicate and get in touch with customers describes the arrangement of activities and resources explains the relationships a company establishes with its customers sums up the monetary consequences to run a business model describes the revenue streams through which money is earned describes the customers a company wants to offer value to outlines the capabilities required to run a company's business model INFRASTRUCTURE CUSTOMER OFFER FINANCE describing a company’s business model
21. Template VALUE PROPOSITION COST STRUCTURE CUSTOMER RELATIONSHIP TARGET CUSTOMER DISTRIBUTION CHANNEL VALUE CONFIGURATION CORE CAPABILITIES PARTNER NETWORK REVENUE STREAMS INFRASTRUCTURE CUSTOMER OFFER FINANCE a business model describes the value an organization offers to various customers and portrays the capabilities and partners required for creating, marketing, and delivering this value and relationship capital with the goal of generating profitable and sustainable revenue streams
22. describing the partners that leverage the business model VALUE PROPOSITION PARTNER NETWORK CORE CAPABILITIES value proposition 1 value proposition 2 … core capability 1 core capability 2 … partner 1 partner 2 … INFRASTRUCTURE OFFER
23. VALUE PROPOSITION COST STRUCTURE cost account 1 cost account 2 … value proposition 1 value proposition 2 … FINANCE INFRASTRUCTURE OFFER describing the costs of a business model CORE CAPABILITIES core capability 1 core capability 2 …
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