There are two categories of key competitors that wal-mart stores experiences, one category is of the medium category, which is of direct competition on similar products or business rivalry with other companies. The second category is one that exerts low pressure; in this category, we have business complementors, who handles similar products to those of wal-mart but are involved in distribution of the products at wholesale thus generating profit for wal-mart.
There are also competitors who sale products that are substitutes to those of wal-mart. Competitors who rival through inducements to buyers by bargains can also be included in this category of low pressure. However, bargaining suppliers present a low-medium competition to wal-mart since is possible for them to capitalise on any faults of wal-mart and become medium competitors for supplying similar products to the consumers (Wal-mart, Industry Analysis). In contrast, wal-mart has surpassed the competition by employing various strategies.
To wade off potential competition from Medium competitors wal-mart being a multi-franchise creates entry barriers through existing channels to distribute its products. Wal-Mart also has branded products, financial capital, and locations that easily discourage the small competitors like Grocers. In addition, wal-mart has upper hand on cost compared to the competitors. Other franchise companies that engage in business rivalry with wal-mart like Kmart, Sears and Target find in ineffective to dislodge wal-mart’s maturity and life cycle industry (Wal-mart, Industry Analysis).
Consequently, super bargain suppliers who represent low to medium pressure find it impossible to overtake wal-marts strategy in holding of the large share of the market. Wal-mart offers huge business volumes of goods to wholesalers and even manufacturers this gives it a strong niche in the market since wal-mart can easily switch to another supplier and create scarcity tactic (Wal-mart, Industry Analysis). Wal-mart has business links to big companies like Coca-Cola and Proctor and Gamble who provide higher bargaining strength in comparison to the small suppliers.
Competitors to wal-mart who fall under the category of low pressure and complimentors do not pose a big threat to wal-mart business. In most cases consumers have, build trust in products branded by wal-mart and will make the obvious choice. Complementors actually arguments wal-marts model of business than competition (Wal-mart, Industry Analysis). Product Mix Competing companies sometimes launch products with aim of gaining on the already existing brand of their competitor.
In the even there emerges product mix which confuses consumers, mostly on packaging materials that closely resemble or by aping technology. Wal-Mart and Target have had product mix in the struggle to create a fashionable attraction to their discounted items. This sometimes results to chic products that cause a head start. For example, Wal-Mart’s brand that had low prices historically and featured a yellow coloration, while Target product was launched having close similarities in features but with inferences discrediting founder of Wal-Mart (Worden, Daring to be Wal-Mart).
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