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Thursday, 3 October 2019

What Today’s Top Retail Firms Can Teach You


These companies boast a huge staff roster while they make a lot of money, too. So, how did they get there? Keep reading to learn how you can turn your company into one that sees as much success as today’s most profitable retail firms.

Amazon

Amazon is the second biggest retailer in the world while they hold the top spot online. Back in the 90s, they were simply a small ecommerce website that had sold books, but today they have turned into this behemoth that makes more than $234 billion in sales online. What’s more, is that they haven’t stopped there, leading in areas such as cloud computing and groceries, to name a few. However, this success did not happen overnight for them. 

Similar to Walmart, which we will talk about next, Amazon started to create the warehouse foundations right from the start to prepare them for what’s to come in the long term. In addition, while they kept their operating profit margins fairly low in comparison to the average percentages, this allowed them to make a strong relationship with their shoppers which was very beneficial in the future. Indeed, they tried to keep their prices as low as possible while offering as wide of a variety as they could in order to catch the attention of customers and get them to buy. Over the years, they simply put back into the company all that they made in order to solidify their delivery infrastructure. Therefore, if companies can take anything from Amazon, it’s that regardless of the kind of growth that you are getting, it is important to continue trying to improve and strengthen your footing. Don’t look at stock prices, for instance, but rather put in a good portion of what you make back into your company that way you can better it for the long term.


Walmart

Today, Walmart has 5,263 stores which have amassed sales totaling $387.66 billion; an amount that is difficult to even fathom. However, before reaching the heights that it has today, Walmart began as a collection of small discount stores that were only located in little towns. The founder, Sam Walton, used Meijer’s business model as a basis for his own model, but made improvements to better cater to his vision. Walton was smart to have begun in smaller areas as this allowed him to conquer rivals with ease. He also made sure that these stores were not far from the regional warehouses. Over time, the business grew, seeing a lot of success between the 70s and 80s due to the fact that regulations in trade became looser, which made it easier to obtain cheap items from China so that they could continue to offer items at the lowest prices possible. After all, that is their motto to this day. Indeed, if someone is looking for items that are inexpensive, the first firm that comes to mind is Walmart. As you can see, throughout all of these years, Walmart continued to stay true to its main purpose regardless of its expansion. This pricing strategy has proven to amount to a lot of success which is why it is recommended that firms find their own purpose that they can stick to from day one and then fifty years into the future. It is also crucial that everyone in the firm has the same objective, to help ensure that the goal is always met by every staff member.

Costco

Costco is yet another example of a store that sells items at the lowest costs. As you can see, this is a strategy that works, especially when you consider the fact that they make $121 billion in sales every year. That being said, they have done a good job of ensuring that they aren’t comparable to that of Walmart as they have shoppers that have higher incomes. This is due to the fact that customers need to become members if they want to shop there and they only sell a particular amount of items that are sold in huge amounts. For instance, shoppers can only choose from about four different kinds of toothpaste while Walmart will offer around 60 different types of toothpaste. However, as a result, they are able to get much better bulk discounts from their suppliers. The company itself is also pretty lean in comparison to others as they are only spending about 10% of its revenue on overhead in comparison to the 20% that Walmart spends. In addition, they do not put in any money into advertisements. They also have lower electricity costs since items remain packaged on the shelves which don’t need skylights which actually makes it fun for shoppers as they get to do a bit of exploring in order to find what they need. Indeed, trying to make its customers excited lies at the core of the firm’s culture. Their culture is like no other as they boast higher wages and great health advantages. Therefore, as you can see, having a good working environment is more important than trying to please corporate. While they might get feisty with big name brands, they never show their teeth to their own staff. 

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