WAR AGAINST WALMART

1
WAR AGAINST WALMART
SECOND EPISODE
vs.

• Devrim Hasanefendioglu
• Nov. 28, 2005 - UTM

2

• 1st EPISODE
• Mission
• Keep
• small-town
• soul
• alive!

Al Norman 1 ENEMY OF WALMART
3
2nd EPISODE Mission Keep supplier profitability
alive!
Dont be fool by the size!
4

• LOW PROFITABILITY
• Large Sale Volume ? High Profitability
• Customer Concept Approach Profitable Growth
• WalMart
• Bargain Hunter
• Modified Rebuy
• Rubbermaid
• Low prices payment discounts
• Inventory cost on-time penalties
• Software investment
• 300 million 20 years payback period
• Price hikes 250 million loss 1995
• Retaining Cost Lifetime Value

5

• USELESS POWER
• Rubbermaid
• 94 customer loyalty
• 2nd powerful brand
• 1 most admired corp. 1993-94
• High Brand Equity
• Cost effective
• Bargaining power
• Charge more
• WalMart dominant actor
• No benefits of market power

6

• RISKY ACCOUNT
• When you hitch your wagon to a star,
  you are at the mercy of that star.
• Getting thrown away
• Affecting other marketing decisions
• Neglecting other customers
• Receiving similar privilege demands
• The fall of the star
• Retail life-cycle concept discount-store
• Every empire has an end
• New trends in retailing Internet
• Competitive advantage sustainability
• Value pricing policy

7

• UNRELIABLE PARTNERSHIP
• Other victims

• Supply Chain System partnership
• Partnership vs. Slavery
• What to do How to do
• Bearing the most inventory marketing costs
• Daring no price increase demand
• We're not going to take your price
  increase, and we really don't care what it
  does to you!

8

• ALTERNATIVES
• Benefiting high brand equity
• Balancing distribution portfolio
• Midsize retailers Internet
• Entering global markets
• Spending 300 million not for WalMart
• RD and Marketing
• Continuous innovation competitive adv.
• Missionary sales force customer loyalty
• Being cost effective
• Vanguard, Southwest Dell
• JIT Production Lean Management

9

• CONCLUSION
• Say NO! against WalMarts unlimited demands!
• Avoid being WalMarted!
• Fire WalMart!
• Let your competitors ruined by WalMart!

10
Questions?
Thank you!