Wal-Mart

Discuss the importance of changes in the external environment to an organization like WalMart.

The discount department store industry has been a growing industry in the United States for years and WalMart has established itself as the leader of the pack. Fierce competition among retailers has forced down prices and has allowed WalMart to become the most dominant retailer in the US. Many changes in the external environment have made this possible.

Several economic trends beginning in the late 1980s helped WalMart to gain market share in the industry. The economic slowdown that lasted into the mid 1990s forced retailers to drop their prices to draw in customers. When the economy returned to prosperity in the late 1990s, this competition only increased. Companies such as Sears, Roebuck and Co. met this competition by restructuring and focusing more on their retail business. WalMart was now forced to compete with companies designed to better serve the consumer. Companies such as Target Stores began to shift its focus to its national markets by carrying more fashionable merchandise. Many companies, such as Caldor and Woolworth Company, were unable to stay with the competition and closed down entirely. WalMart was able to buy up many of stores and expand its own market.

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