Picking Walmart’s P.O.C.K.E.T.S. Michael Bergdahl International Speaker, Author & Walmart Competition Authority Casas GEO March 2011

Lions or Gazelles?

“Bird-Dawg”

X X Bentonville, Arkansas Walmart Headquarters

STRATEGIES of the World's Largest Company TACTICS of the World's Richest Man

1962 Sam Walton’s first store Rogers, Arkansas

Walmart Big Facts - World’s Largest Employer – 2.3 million - Weekly, 200 million customers shop its stores. - 89% of the USA public shop its stores annually - Its 2010 sales exceeded US$400 billion.

Sam Walton’s Goal was never to be the biggest...

Walmart 2011 USA, Japan, United Kingdom, Canada, Mexico, India, China, Argentina, Brazil, Guatemala, Honduras, Costa Rica, El Salvador, Nicaragua & Puerto Rico & South Africa USA, Japan, United Kingdom, Canada, Mexico, India, China, Argentina, Brazil, Guatemala, Honduras, Costa Rica, El Salvador, Nicaragua & Puerto Rico & South Africa

Mexico is Walmart’s 2 nd largest market!

Do you shop at Walmart? Why?

Walmart Venezuela & Colombia?

The Walmart Way To provide superior customer service Goal to be the best at serving customers To make customers the focus of everything

The Casas GEO Way To provide superior customer service Goal to be the best at serving customers To make customers the focus of everything

The Walmart Way Goal: To be the #1 Retailer in every Market

The Casas GEO Way Goal: To be the #1 Home Builder in every Market

The Walmart Way P.O.C.K.E.T.S. Price Operations Culture Key Item Promotion/Product Expenses Talent Service

1.Be #1 in Every Market 2.The Best Place to Live 3.GEO Culture 4.Meet the Budget 5.GEOmore The Casas GEO Way GEOstrategy – Doing everything for the client

“How did Walmart turn its Price Strategy into such a powerful competitive advantage?” Price Price Strategy Question:

Answer: Other retailers focused on how much they could charge for their products... Price

Sam Walton’s Discounting Principle Buy an item for 80¢ & price it at $1.00 Sold 3 times as much as he could at $1.20 Though he made ½ the profit per item He generated a greater profit overall Price

Shopping Cart Comparison “Walmart saves its customers US$2500 per year on groceries!” Price

Walmart’s Pursuit of Value 1. Buying at lowest prices 2. Controlling their own expenses 3. Get suppliers to lower expenses 4. Pass savings along to customers Price

Pricing Ideas for The Casas GEO Way Price Control your costs – pass savings on to customers Provide a better quality home for a comparable price Value price leader – “Building Communities”

Operations Strategy Question: “What makes Walmart’s Store Operations so unique?” Operations

Answer: Walmart is a logistics, distribution, transportation, & technology driven company

120,000 products 8300 stores 120 DC’s Cross docking distribution centers No Warehouses Largest privately owned IT systems in the world 7000 privately owned truck fleet – largest in the USA Operations

Hurricane Katrina “Walmart’s trucks arrived in New Orleans days before the United States Federal Government!” Operations

Benchmarking Best Practices Vendor Partners P&G Disney FedEx Operations

Operations Ideas for The Casas GEO Way Operations 1. Continuous Improvement 2. Leverage Technology 3. Demand Superior execution: By your leaders By your employees By your suppliers

Culture Strategy Question: “How did Sam Walton turn the people at Walmart into a competitive advantage?” Culture

Answer: “Sam Walton believed if you take care of your people...” Culture

What Makes Walmart... Walmart? Istanbul, Turkey Culture

The Sam Walton Way 1 agenda 3 values 7 POCKETS strategies 10 rules – his tactics Sam Walton

Walmart refers to its... - Employees as Business Partners - Customers as Neighbors or Friends - Managers as Coaches - Suppliers as Vendor Partners Culture

Culture Ideas For The Casas Geo Way Culture Communicate Your Primary Mission - SERVICE Drive decision making down - EMPOWERMENT Adapt quickly – EMBRACE CHANGE

“What is Walmart’s strategy for selecting products?” Key Item Promotion / Products Strategy Question: Key Item Promotion / Products

“An outside-in approach” Answer: Key Item Promotion / Products

One Agenda Sam Walton required every employee at Walmart to think like a Retail Merchant Key Item Promotion / Products

Saturday Morning Meetings Product Presentations by the Buyers Key Item Promotion / Products

Vendor Partnerships 3 kinds of suppliers Key Item Promotion / Products

Product mix is adapted “Walmart’s leaders manage as if it were a small company!” Key Item Promotion / Products

Key Item Promotion / Product The Casas GEO Way Key Item Promotion / Products Provide a product with superior value Be known as the best builder Be known as the best place to live

Expenses “How important is expense control to Walmart’s strategy?” Expenses

Answer: “Walmart’s success is driven equally by buying products at the lowest prices and continuously reducing costs.” Expenses

Sam Walton’s People Greeters Theft control specialists Expenses

Expense Control at Walmart Everyone is expected to negotiate The Walmart Price Walmart leverages Scale Expenses

Expense Control at Walmart Everyone is expected to negotiate The Walmart Price Walmart leverages Scale Expenses

Expense Control The Casas GEO Way As volume rises – expenses go down Leaders need to lead by example Pass savings along to clients Expenses

Talent “How did Sam Walton get hundreds of thousands of employees to execute his aggressive tactics?” Talent

Answer: “Sam Walton hired average people, encouraged them to perform at above average levels.” Talent

H.E.A.T.K.T.E. HE ATKT E High Expectations Are The Key To Everything Talent

Talent Pool - Bentonville - hired off the farm - 75% of managers promoted internally - The Walmart Way is most important Talent

Talent Ideas for The Casas GEO Way Hire for attitude and teach the skills Deal with Non-performers Adapt The Casas Geo Way standards Talent

Service “What is the importance placed on customers and customer service at Walmart?” Service

Answer: “ The focus of all of Walmart’s Strategies is to improve the customer’s experience.” Service

All for one and one for all Internal Customer Service Service

The Walmart Cheer Service Who is Number One?

Sam Walton’s Legendary Service Standards “99.9% of Customers are honest” The Customer is the Boss 2 rules of Customer Service Service

Service Ideas for The Casas GEO Way Empower employees to resolve complaints All for one and one for all mentality Drop everything else to serve your customers Service

The Walmart Way & The Casas GEO Way Focus everything on your clients

The Casas GEO Cheer Service Who is Number One? CasasGEO