Question

On the basis of the wal-mart company answer the following questions.

Planning, sales forecasting and budgeting application criteria:

1 strategic planning and linkage to strategic marketing
2 efficient and effective sales strategy
3 forecasting approaches and methods of sale forecasting
4 purpose and process of sales budget

Answer 1

1. Strategic planning of Walmart is basically based on the three initiatives taken by them: -

- Save money, live better: - This is the first initiative of Walmart which consist of: -

Price leadership: - As they follow everyday low pricing model in which they sell the products at a discounted rate whole year which make them leader in this segment. Price which they offer to their customer is very less compared to other retailers which help them in gaining market share.

Private labels:- Walmart is more focusing on introducing their more private label product options to their customers so that they can offer less price to their customer as well their profit margin will also increase because in private label products, owner has full control over the price.

Integrated brand communication: - Walmart will be reducing their suppliers and products and focusing more on remaining vendors and telling them to increase co-branded advertising campaign.

-Win, Play, show: - This is the second initiative which consist of: -

Win is related to those top priority categories of products which brings most of the business for Walmart ad helps them in gaining market share as well. Walmart tries to market these products.

Play is related to the strategic categories which is at a growing stage and Walmart want these category selling vendors to market the product to Walmart so that these categories products are not removed from the shelves of Walmart.

Show is related to those categories of products which Walmart want to remove but it does not get removed all together at once.

- Fast, friendly, clean: - This is the third initiative which consist of: -

Merchandise Flow: - 48 hours is the replenishment cycle of Walmart. Products flow is very good as they adopt efficient process such as cross docking which helps in reducing operational cost.

Zero waste facilities: - It follows sustainability in its operation activities which starts from manufacturing to placing on shelves to consumption with no waste at all.

2. Walmart effectives and efficient sales strategy is main focused on their pricing and wider product range. As we know that Walmart offers wide product range to its customers at very less price which helps them attracting large number of buyers to store and also helps in gaining higher volume of sales. Customer comes here to almost purchase in bulk like for a month purchase because here they get the choice which they will never get at any other retail stores and that to at very less price. Their supply and distribution system are very strong, and they follow robust model which helps them reducing the lead time and product is available to the customer at a right time.

3. Forecasting Approaches and sales forecasting is totally based on their buying patterns of consumer and historical or past data. Usually all retail chains use past year data for deriving the forecast for a particular category or line of products. Walmart first tries to forecast demand through the current trends and their sample data in which they apply some stats and get to the result related sales forecasting.

4. Sales budget is very important as this all includes the expense of the company related to sales for example promotional expense and distribution expense and many more things which contributes in deriving sales lastly.

Sales budget is processed through the senior sales team only in which Boards are also involved.