Page 7 - [STUDY CASE_GROCERY WARS] Report
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On the other hand, Walmart is a dominant player known for its brick-
and-mortar stores and is considered the largest seller of groceries in
the USA. However, Walmart has little presence in the online market as
it is still working to catch up with leading online market retailers like
Amazon. Walmart has a loyal base of offline shoppers from where it
attracts enormous traffic to drive its grocery sales. For the competitive
force model, Walmart’s suppliers have low bargaining power because
Walmart is a giant retailer and holds power. The bargaining power of
the buyer is also low because they already offer items at a cheap price
and customers are unlikely to find the same product at a lower price. It
also has a low threat from substitute products because Walmart offers
one the lowest price giving them a competitive edge. Been the
biggest retail brand its also has low threat from new entrants.
However, the competitive rivalry among the existing player is
moderate because it has quite of bit of competitors like Target, Best
Buy, Amazon and Costco but don’t pose a major threat because it has
competitive edge in term of price strategy.
As the Porter model focuses on identifying only competitive forces
and generic strategies, let’s move to a value chain model that focuses
on specific activities on which competitive strategies can be applied
and have a maximum strategic impact from the use of information
technology.
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