How Did Sam Walton Build Wal-Mart’s Sustainable Competitive Advantage? -Business Strategy and The Key Success Factors

The year 1962 was called the year of discounting. Hundreds of discounting stores had popped up all across the USA. In the same year, three big companies started their discount chains. One company, Woolworths, opened gigantic stores. Everyone thought that the Woolworths chain of stores would conquer the world. But the company vanished from the scene in a few years. The other company, K-Mart entered discounting with a big bang. The third company, Dayton-Hudson opened its first ‘Target’ store in a big city. All three were giants and people were optimistic about their growth. And then one guy started a small ‘discounting store’ called ‘Walmart’ in a small town called Rogers, Arkansas. Nobody gave him any importance. He received no media coverage. He was just one among those hundred small discounting store owners waiting to be eaten up by the three giants.

Within 5 years, Kmart had 250 stores with sales of $800 million to Walmart’s 19 stores with sales of $9 million. By 1970, Target reached $200 million in revenue with 24 stores — well ahead of Walmart. But…. five decades later, Kmart has 365 stores with sales of $25 billion to Walmart’s 11,718 stores with sales of $500 billion. Target’s revenue in 2017 was $72 billion.