Who knows what I thought? I mean, you know, only my psychiatrist can tell me. And that thumb sucking, reluctance to pay a little more — the current cost is in the area of 10 billion. Highlighted below are my favourite excerpts from Walton's book that explain the key drivers to Wal-Mart's success. I didn't just learn from reading every retail publication I could get my hands on, I probably learned the most from studying what John Durnham was doing across the street.
If you do, they'll come back over and over. Give them what they want and a little more. Let them know you appreciate them. I started thinking about what really brought them down. It all boils down to not taking care of their customers , not minding their stores, not having folks in their stores with good attitudes, and that was because they never really even tried to take care of their own people. If you want people in the stores to take care of the customers , you have to make sure you're taking care of the people in the stores. That's the most important single ingredient of Wal-Mart.
What has carried this company so far so fast is the relationship that we, the managers, have been able to enjoy with our associates. By 'associates' we mean those employees out in the stores and in the distribution centres and on the trucks who generally earn an hourly wage for all their hard work. Our relationship with the associates is a partnership in the truest sense. It's the only reason our company has been able to consistently outperform the competition - and even our own expectations.
Because the way management treats the associates is exactly how associates will then treat the customers. And if the associates treat the customers well, the customers will return again and again , and that is where the real profit in this business lies , not in trying to drag strangers into your stores for one-time purchase based on splashy sales or expensive advertising.
Satisfied, loyal, repeat customers are at the heart of Wal-Mart's spectacular profit margins, and those customers are loyal to us because our associates treat them better than salespeople in other stores do. So in the whole Wal-Mart scheme of things, the most important contact ever made is between the associate in the store and the customer. In fact, the biggest single regret in my whole business career is that we didn't include our associates in the initial managers-only profit-sharing plan when we took the company public in These days, the real challenge for managers in a business like ours is to become what we call servant leaders.
And when we do, the team - the manager and the associates - can accomplish anything. Over the years, we've also had a variety of incentive and bonus plans to keep every associate involved in the business as partners. All of us like praise. So what we try to practice in our company is to look for things to praise. We want to let our folks know when they are doing something outstanding, and let them know they are important to us.
Wal-mart: it all began in a small store in Arkansas | Business | The Guardian
Walmart was just another one of Sam's crazy ideas. It was totally unproven at the time, but it was really what we were doing all along; experimenting, trying to do something different , educating ourselves as to what was going on in the retail industry and trying to stay ahead of those trends. From up in the air we could check out traffic flows, see which way cities and towns were growing, and evaluate the location of the competition - if there was any. If everybody else is doing it one way, there's a good chance you can find a niche by going in exactly the opposite direction.
It makes people feel responsible and involved, and as we've gotten bigger we've really had to accept sharing a lot of our numbers with the rest of the world as a consequence of sticking by our philosophy. In a system like that, there's absolutely no room for creativity , no place for the maverick merchant that I was in the early days of the Ben Franklin [store], no place for the entrepreneur or the promoter. I've always thought of problems as challenges. I like to hear what our weakness are , where we aren't doing as well as we should and why. I like to see problems come up and hear suggestions as to how it can be corrected.
And figure out ways to get them talking. The folks on the front lines - the ones who actually talk to the customer - are the ones who really know what's going on out there. You'd better find out what they know. You never know who is going to have great ideas. Working weekends ; it's just something you have to do if you want to be successful in the retail business.
I think that misunderstanding worked to our advantage for a long time , and enabled Wal-Mart to fly under everybody's radar until we were too far along to catch. It always confounded them. They held on to their old variety concept stores too long. With our low costs, our low expense structures, and our low prices, we were ending an era in the heartland. We shut the door on variety store thinking.
Check everyone who is our competition. Inspired by the early success of his dime store, and driven to bring even greater opportunity and value to his customers, Sam opened the first Walmart in at the age of 44 in Rogers, Arkansas.
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Sam's competitors thought his idea that a successful business could be built around offering lower prices and great service would never work. As it turned out, the company's success exceeded even Sam's expectations. The company went public in , and the proceeds financed a steady expansion of the business. Sam credited the rapid growth of Walmart not just to the low costs that attracted his customers, but also to his associates.
He relied on them to give customers the great shopping experience that would keep them coming back. Sam shared his vision for the company with associates in a way that was nearly unheard of in the industry. He made them partners in the success of the company, and firmly believed that this partnership was what made Walmart great. As the stores grew, so did Sam's aspirations. In addition to bringing new approaches and technologies to retail, he also experimented with new store formats—including Sam's Club and the Walmart Supercenter—and even made the decision to take Walmart into Mexico.
Sam's fearlessness in offering lower prices and bringing Walmart's value to customers in the U. His strong commitment to service and to the values that help individuals, businesses and the country succeed earned him the Presidential Medal of Freedom, awarded by President George H.
It was during Sam's acceptance remarks that he articulated what would come to be Walmart's official company purpose. Today, "saving people money so they can live better" is the driving force behind everything we do. Sam Walton believed running a successful business boils down to 10 simple rules and they helped Walmart become the global leader it is today.
We continue to apply them to every part of our business. Sam Walton died in , shortly after receiving the Medal of Freedom, but his legacy lives on. To this day, Walmart remains a leader in the retail industry. We are committed not just to expanding the business to better serve our customers, but also to improving the communities we serve through our efforts to constantly improve what we do and how we do it, and through the impacts we're able to achieve through the Walmart Foundation.
Through this daily dedication to our business and our customers, we honor Mr. Walmart's history is more than just the stores we've built, the partnerships we've made and the customers we've served. So much of our history is in the details. Walmart launched without a true logo. In fact, for the first two years, when the Walmart name appeared in print, the font and style were chosen at the whim of the printer.
In , the company selected a font. It survived for nearly 20 years. Some context might help here. Sam said this — about himself. Also, he was the first of his competitors to adopt computer and satellite technology, which put him ten years ahead of everyone else. I want you to take a pledge with me. I want you to promise that whenever you come within ten feet of a customer, you will look him in the eye, greet him, and ask him if you can help him.
It would help your personality develop, you would become more outgoing, and in time you might become manager of that store, you might become a department manager, you might become a district manager, or whatever you choose to be in the company.
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It will do wonders for you. Now, I want you to raise your right hand—and remember what we say at Wal-Mart, that a promise we make is a promise we keep—and I want you to repeat after me: From this day forward, I solemnly promise and declare that every time a customer comes within ten feet of me, I will smile, look him in the eye, and greet him. So help me Sam.
I also was worried that we might lose the team concept, or fail to keep the family concept viable and realistic and meaningful to our folks as we grow. But I can also tell you this: How many businesses are failing at satisfying their customers every time? What is your plan? That may have been one of the greatest single reasons why IBM was successful. We exist to provide value to our customers, which means that in addition to quality and service, we have to save them money. Every time we save them a dollar, that puts us one more step ahead of the competition—which is where we always plan to be.
The thing I remember most, though, was the way we priced goods. Merchandise would come in and we would just lay it down on the floor and get out the invoice. We paid 50 cents for it. No matter what you pay for it, if we get a great deal, pass it on to the customer. Word would get around that you had really low prices.
7 Top Quotes from Sam Walton, Founder of Walmart
Everything else in the store was priced low too, but it had a 30 percent margin. Health and beauty aids were priced to give away. My answer is of course it could happen again. It will be done again, over and over, providing that someone wants it badly enough to do what it takes to get there. This is probably one of the most inspirational quotes in his whole book.