how the firm functions in different parts of the world

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In this Assignment, you will broaden the scope at how the firm functions in different parts of the world and what it can do to maximize its effectiveness as a global organization. A strategic audit will be performed and forecasts will be made for the next 2 years.

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Unit 6 [GB540: Economics for Global Decision Makers] Assignment: Fortune 500 Companies For this Assignment, you may use a Fortune 500 Company that you have already researched. The focus here is on both domestic (American) and global operations. The Assignment incorporates how the firm functions in different parts of the world and what it can do to maximize its effectiveness as a global organization. Course outcomes practiced and assessed in this Assignment: GB540-4: Integrate concepts of regional, national, and global economic behavior with macroeconomic theory. PC-4.1: Assess the value of multiculturalism and diversity in a global environment. Directions Begin by reviewing the following websites as resources for your Assignment: Organisation for Economic Co-operation and Development (OECD). (2017). Economic indicators. Retrieved from http://www.oecd.org/std/oecdmaineconomicindicatorsmei.htm U.S. Department of Commerce. (n.d.). Key economic indicators. Retrieved from https://www.commerce.gov/economicindicators U.S. Bureau of Labor Statistics. (n.d.). Major economic indicators. Retrieved from https://www.bls.gov/bls/newsrels.htm Select 6–10 macroeconomic indicators that are of particular relevance to your firm and explain how they affect the performance of the company. Outline strategies on how the firm should respond to the changes in the economic indicators with the goal of maximizing revenues in the years ahead. How have they done in the past? What is their current state? What kinds of plans and possibilities do they have for the future? Is there room for improving what they do? Should new ventures be added or old ones subtracted? Then, discuss the firm’s global operations, and their influences on the regional and national levels. You also need to assess the value of multiculturalism and diversity in operating (managing) a company in a global environment. As you can see, the field is wide open for you to construct your paper in the most relevant way you see fit. 1 of 3 Unit 6 [GB540: Economics for Global Decision Makers] Criteria As part of the Assignment, you will need to include the following: ● Your Assignment should have a coversheet with the following information: Title of the paper, Your Name, Course Number and Section Number, and Date ● It must be a minimum of 5-pages long (excluding the title page, references, etc.) ● Be sure to include the criteria located in the rubric below within your paper. ● It must be APA formatted with citations to your sources and your last page should list all references used. Review the APA formats found in the Writing Center. ● You must use a variety of three objectives, high quality, and current sources. Peer reviewed articles, articles published in journals, textbooks, and library resources found in the Library are examples of high quality resources. ● Note that Wikipedia, Investopedia, etc. are not considered as reliable resources for this research. Directions for Submitting Submit your Assignment to the Unit 6 Assignment Dropbox by the end of Unit 6. GB540 Unit 6 Assignment Content and Analysis Points Possible Selected a global fortune 500 company. 10 Selected and defined 6-10 macroeconomic indicators of particular relevance to the firm chosen. 10 Discussion for each of the macroeconomic indicators includes an explanation of its relevance to the performance of the firm. 10 Discussed strategies of how the firm will respond to changes in the macroeconomic indicators to maximize revenue. 10 Provided an appropriate analysis of the firm’s global operations and integrating information at the regional and national levels. 10 Examined how well the firm has operated in the past. 10 Analyzed the firm’s current financial state and performance. 10 Discussed plans and possibilities the firm has for the future. 10 Presented an appropriate explanation and analysis of where there is a room for improvement. 10 Evaluated whether the firm should add new ventures. 10 Included an analysis of how well the firm’s strategies that have worked to date. 10 Points Earned 2 of 3 Unit 6 [GB540: Economics for Global Decision Makers] Assessed the value of multiculturalism and diversity in a global environment. 10 Writing, grammar, and includes at least three reliable references in APA formatting. In-text references are included in the contents. 10 Total PC-4.1 130 Assess the value of multiculturalism and diversity in a global environment. Not Assessed No work was received by the instructor. N/A No Progress 0 Student work demonstrates no understanding or progress towards achievement of this outcome. Introductory 1 Student work demonstrates the ability to identify multiculturalism and diversity issues. Emergent 2 Student work demonstrates the ability to identify multiculturalism and diversity issues, and articulate them in a global context. Practiced 3 Student work demonstrates the ability to identify, articulate, and explain a multiculturalism and diversity issue in a global context. Proficient 4 Student work demonstrates the ability to analyze the benefits of multiculturalism and diversity in a global context. Mastery 5 Student work demonstrates the ability to analyze the benefits and challenges of multiculturalism and diversity in a global context and recommend solutions. 3 of 3 1 Running head: WALMART Walmart Company Kaplan University January 3, 2017 Marshalee Spence WALMART 2 Walmart is a retail company that operates internationally. As an American multinational company, the firm operates on hypermarkets, grocery, and departmental stores. The firm has its headquarters in Bentonville, Arkansas. According to Global Fortune 500 in the year 2016, Walmart company is the largest firm in the world in terms of revenue. The company continues to grow in all spheres, and it is expected to increase its revenue in the coming years. This paper, therefore, seeks to explore the history, political, social and economic forces affecting the company, financial performance and SWOT analysis of the firm as well as factors needed to predict, plan and alter the future of the retail company for the better. Sam Walton is known as the founder of the company in the year 1962. In the year 1945, Walton bought a branch of the Ben Franklin stores which was then under the Butler brothers. Walton did this with the aim of selling his products at a lower price to have a higher volume of sales while at the same time getting a small amount of profit. In actuality, his vision was to create customer loyalty and build a firm that was to operate and meet the needs of the society of all classes at large. In his first five years, he made an increase in revenue despite the challenges which he faced in the first years. After some period, the lease for the location expired, and Walton opened a new store which was located at Bentonville (Farris, Farris, Shames, Shames, Mitchell & Mitchell, 2017). Within the first five years, the firm expanded to 24 stores in entire Arkansas. It is during the year 1968 that the firm opened its first store outside Arkansas. As such, stores were opened in Oklahoma, Claremore, Missouri, and Sikeston. The year 1969 saw the company incorporated as Wal-Mart, Inc. this resulted in the change of the name into Wal-Mart Stores, Inc. in 1970. By this time, the company had 38 stores with 1500 workers. Its first home office and a distribution center were then opened in Bentonville. The company was selling stock at this particular period as a publicly held firm while WALMART 3 operating in five starts in the US. Walmart continued to grow rapidly, and in 1987, the company had 1198 stores and sales of $15.9 billion. The following year, Walton was replaced as the CEO by David Glass. However, Walton still remained to be the chairman of the board of the company. Walmart moved from being number three retail company in the US to becoming number one defeating its close competitors such as Kmart and Sears. Pennsylvania and California stores were opened in the year 1990. This made the company the most powerful retailer in the US, and as such, it expanded to Mexico and Canada in 1991 and 1994 respectively. From then, the company grew internationally opening stores in north and south America. H. Lee Scott became the CEO and president of the company in 2000 as the sales reached a whopping $165 billion. Walmart appeared on the Fortune 500 list for the first time in 2002 as the largest corporation in America. Since then, the company has been on the list due to its growth and expansion in different parts of the world. Currently, Walmart is found in many parts of the world and has a high volume of sale due to its friendly price to consumers. Walmart company, however, faces some forces which affect its working. These are social forces which to a large extent determine the buying behavior of consumers. For example, consumer demographics have changed over time where the new technology has impacted on how consumers make their purchases. On political forces, Walmart which operates internationally is affected by the changing nature of trade laws in different nations where it serves. Economically, the company has for a long period been affected by the currency exchange rate especially between the US dollar and other currencies (Perkins, 2016). Additionally, labor cost has been another economic force affecting the company. Other forces include high unemployment rate in the US, the dynamics of tax rates in different nations and economic stability. WALMART 4 Walmart recent and current financial performance table. Year 2014 2015 2016 2017 469.16Bilion 476.29Bilion 485.65Bilion 482.13Bilion 485.14Bilion Cost of goods 352.49Bilion 358.07Bilion 365.09Bilion 360.98Bilion 361.26Bilion 349.2Bilion 355.91Bilion 351.53Bilion 351.18Bilion 8.5Bilion 8.87Bilion 9.17Bilion 9.45Bilion 10.08Bilion Depreciation 8.5Bilion 8.87Bilion 9.17Bilion 9.45Bilion 10.08Bilion Gross 116.67Bilion 118.23Bilion 120.57Bilion 121.15Bilion 123.89Bilion Sales 2013 sold including D&A Cost of goods 343.99Bilion sold excluding D&A Depreciation and Amortization Expense Income(GI) WALMART 5 From the above table, Walmart company has experienced growth in the last five years. The statistics show there has been an increase in the number of sales in from the year 2013 until the year 2017 (Daniel, Neves & Horta, 2017). This, in turn, has resulted in an increased gross income in the company. This can be articulated to the integration of the new technology in some of the nations where the company operates. Use of an online platform to enable consumers to order and purchase products and services from the company has been integral to its rapid growth in the year 2017. There are many economic forces which have affected the revenue and profit of Walmart company. For instance, the cost of labor has been one of the major economic challenges facing the company. Walmart has been criticized for underpaying its workers. As a result, the company had to raise its minimum wages in the year 2015 to avoid the bad image it had to the public regarding its salary to employees. Economic stability is another force which affects the working of the firm. During times of recession like it happened in the year 2008, the revenue and profit of the company were affected significantly. The 2008 economic crisis is a good example where the net sales decreased in all its stores across the world. Change in tax rates and a high unemployment rate especially in the US has affected the working of the company adversely. The performance of Walmart is also affected by social forces. For example, the lifestyle, beliefs, and culture of people in certain regions affects the performance of any company. Walmart which operates globally is affected by such social factors in areas where people lifestyles and culture does not favor the use of products and services produces by Walmart. Such has been a great challenge to the company (Morillo, McNally & Block, 2015). Additionally, in some nations, there is a trend of using cheap and local products which have become a threat to WALMART 6 Walmart performance. Besides, the increased use of online shopping where millennials use their smartphones and personal computers to shop has dealt a big challenge to Walmart which is a physical retailer in many parts as it is yet to embrace online presence globally. Political forces such as political instability in nations where the company operates have been a big challenge to its performance. This is because in a nation where there is political instability the economy is likely to deteriorate hence affecting the purchasing power of the people (Perkins, 2016). Further, the changing nature of trade laws in different countries impacts negatively on the performance of Walmart. SWOT analysis gives an analysis of both the internal and external forces which are significant to the development of a company. Walmart company has several strengths which include its large size globally, worldwide supply chain and high efficiency in its supply chain. The size of the company enables it to support growth and expansion. The worldwide supply chain offers resilience to certain market risks. Weaknesses of Walmart comes from its generic strategy. They entail the meager profit margin and its model which is easily copied. However, the company has opportunities such as its expansion in developing nations, efficiency in human resource practices and high-quality standards (Huang & Yu, 2015). These opportunities can be utilized by Walmart to improve further while counteracting the threats and weaknesses. Walmart also faces some threats like personal online selling, healthy lifestyle trend because most of the product in Walmart are not healthful. In addition, stiff competition from other retail companies is a challenge. There are factors which Walmart will need to predict to enhance its performance in the future. For instance, consumer empowerment is a necessity prediction. This is because customer satisfaction is the main goal of retail companies and empowering customers in the future will WALMART 7 boost the performance of Walmart. Another factor is a shared value. Walmart will grow even further in future through shared value that is of benefit to both the shareholder and the society. As such, it is imperative to predict this factor. To plan for the future, it is imperative that Walmart puts into considerations becoming a flexible merchant where it will incorporate healthful products into its market. Additionally, it needs to focus on improving the use of technology in its stores. Walmart, however, will need to change its pricing strategy to appeal to consumers of different economic levels. Furthermore, its generic strategy which leads to its weaknesses needs to be adjusted to lower the effects of such weaknesses. To conclude, Walmart company has been developing and dominating the retail industry. As noted in the above discussion, the company has been performing well in the recent past and is still expanding to developing nations today. However, it faces political, social and economic challenges in different regions of the world where it operates. Despite the challenges, Walmart remains to be a dominating force in the contemporary society when it comes to retail industry. WALMART 8 References Daniel, M., Neves, R. F., & Horta, N. (2017). Company event popularity for financial markets using Twitter and sentiment analysis. Expert Systems with Applications, 71, 111-124. Farris, P. W., Farris, P. W., Shames, E. R., Shames, E. R., Mitchell, J., & Mitchell, J. (2017). Levi's at Wal-Mart?. Darden Business Publishing Cases, 1-24. HUANG, J., & Yu, J. I. A. (2015). Wal-Mart Development in Chinese Market: Problems and Countermeasures—Based on the Enterprise Culture and Ethics. International Business and Management, 10(2), 11-15. Morillo, J., McNally, C., & Block, W. E. (2015). The Real Walmart. Business and Society Review, 120(3), 385-408. Perkins, J. (2016). The New Confessions of an Economic Hit Man. Berrett-Koehler Publishers.
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Running head: MACROECONOMIC INDICATORS AND FIRM PERFORMANCE

Macroeconomic Indicators and Firm Performance
Name
University Name
Course
Jan 14, 2018

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MACROECONOMIC INDICATORS AND FIRM PERFORMANCE

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Introduction
The company chosen for the case study is Wal-Mart Stores, Inc.In 2017, Walmart
ranked first in the list of Fortune 500 companies with estimated revenue of $485,873
million(“Walmart,” n.d.).Walmart is one of the largest chains of retail stores that offer a
range of items under various categories such as grocery,health,home décor and
appliances,health and wellness.The company was founded by Sam Walton in 1962
headquartered in Bentonville, Arkansas, U.S. The company also implements program such as
every day low prices(ELC) to offer products at a lower cost.Walmart uses e-commerce
websites to sale retail products online.It has successfully developed its brand image, and
people easily recognize the company with its name.
The objective of the paper is to analyze the impact of macroeconomic factors on the
financial performance of the company.The paper seeks to provide strategies the firm should
respond to the changes in the economic indicators with the objective of maximising
revenue.The paper also includes analysis of Walmart’s global operations and integrating
information at the regional and national levels with its current financial state and
performance.Further, Walmart plans and possibilities for the future is discussed along with
the possibility of adding new ventures.
Macroeconomic Indicators
Macroeconomic factors are key indicators of economic performance that significantly
affect both local and multinational companies. The revenue of the company is significantly
affected by macroeconomic factors like GDP of the economy, consumer price index (CPI),
unemployment rate, balance of payments, producer price index and interest rates.

MACROECONOMIC INDICATORS AND FIRM PERFORMANCE

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GDP: Gross Domestic Product (GDP) is a monetary measure of the market value of
all financial goods and services. It represents the size of the economy Walmart tends to
follow the trend of GDP growth and reduction(Coe,2009).The trend makes sense as
consumption forms an integral part of GDP which would peg the GDP and retail sales to one
another. When the GDP of the economy rises, production of goods and services increases
causing an increase in the sale of company’ products. Consumption includes the most
significant component of GDP.When the consumption is higher, consumer confidence level
in purchasing goods is higher causing an increase in sales of goods and ser...


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