Walmart Inc. (WMT): history, ownership, mission, how it works & makes money (2024)

A Brief History of Walmart Inc. (WMT)

Founded by Sam Walton in 1962, Walmart Inc. has grown to become the world's largest retail corporation. The company's journey from a single store in Rogers, Arkansas, to a global giant in retail is marked by innovation, strategic initiatives, and a relentless focus on providing value.

• 1962: Inception - Sam Walton opens the first Walmart store in Rogers, Arkansas.
• 1970: IPO - Walmart goes public, with its stock listed on the New York Stock Exchange under the ticker symbol WMT.
• 1980s: Expansion - The company expands rapidly across the United States, reaching 276 stores by the end of the decade.
• 1991: International Expansion - Walmart enters the international market with a store in Mexico City.
• 1999: Online Presence - Walmart launches its e-commerce website, walmart.com, to keep up with the growing online shopping trend.
• 2000s: Global Dominance - Expands into countries such as Germany, China, and the United Kingdom, making it a truly global retailer.
• 2005: Sustainability Initiatives - Walmart introduces sustainability goals, focusing on renewable energy, reducing waste, and promoting environmentally friendly practices.
• 2016: Acquisition of Jet.com - To strengthen its online retail presence, Walmart acquires Jet.com for $3.3 billion.
• 2018: India Market - Walmart acquires a 77% stake in Flipkart, one of India's largest e-commerce companies, for $16 billion.
• 2020: Pandemic Response - Amid the COVID-19 pandemic, Walmart adapts to increased demand for online shopping, expanding its e-commerce and delivery services.

Walmart continues to evolve, focusing on technological innovations, sustainability, and expanding its global footprint. Its commitment to offering low prices and a wide range of products has cemented its position as a leader in the retail industry.

Who Owns Walmart Inc. (WMT)

Walmart Inc. (WMT) is a publicly traded company, meaning its ownership is spread among a multitude of shareholders who purchase its stock on the open market. However, there are significant shareholders who hold a larger proportion of the company's shares, and their influence is notable in the operation and governance of the company. Below are some of the key owners of Walmart Inc.:

• Walton Family: The Walton family is the largest shareholder in Walmart, maintaining significant control over the company. The family collectively holds about 50% of Walmart's stock through various trusts and personal holdings. The Walton family’s deep involvement stems from Sam Walton, the founder of Walmart, and his descendants.
• Institutional Investors: Several institutional investors hold substantial stakes in Walmart Inc. These include:
  • Vanguard Group: One of the world’s largest asset management companies, Vanguard Group holds a significant percentage of Walmart's shares, making it one of the top institutional investors in the company.
  • BlackRock, Inc.: Another major player in the asset management industry, BlackRock also holds a considerable portion of Walmart's stock.
  • State Street Corporation: This financial services and asset management company is among the top institutional investors in Walmart.
• Individual Shareholders: Apart from the Walton family and institutional investors, there are numerous individual shareholders who own smaller percentages of Walmart shares. These can range from retail investors to company employees who have been given stock options.

The combination of family ownership and institutional investors plays a crucial role in Walmart's corporate governance, influencing key decisions and the strategic direction of the company.

Walmart Inc. (WMT) Mission Statement

Walmart Inc.'s mission statement is to "save people money so they can live better." This succinct yet powerful mission drives all aspects of the company's business operations and initiatives.

The mission statement reflects Walmart's core values and strategic goals, which include:

• Affordability: Walmart aims to offer products at the lowest possible prices to enable customers to save money on their everyday purchases.
• Accessibility: The company is committed to making its products and services widely available, ensuring that a broad spectrum of consumers can benefit from its offerings.
• Customer Focus: Walmart places a high emphasis on understanding and meeting the needs and expectations of its customers, striving to enhance the overall shopping experience.
• Efficiency: To maintain low prices, Walmart continuously seeks innovative ways to improve its supply chain and operations, ensuring cost savings are passed on to the consumer.
• Community Impact: The mission extends to making a positive impact in the communities where Walmart operates, through initiatives such as charitable contributions, sustainability efforts, and job creation.

Overall, Walmart Inc.'s mission statement encapsulates its dedication to providing value and enhancing the quality of life for its customers, employees, and communities.

How Walmart Inc. (WMT) Works

Walmart Inc. (WMT) operates as a global retailer, providing a wide variety of products and services at low prices to millions of customers across the world. Founded in 1962 by Sam Walton, Walmart has grown to become one of the largest and most influential retail companies in the world. Here’s a look at the mechanisms that keep Walmart running efficiently:

Walmart operates in several retail formats, each catering to different customer needs:

• Supercenters: These combine a full grocery store with a wide assortment of general merchandise, allowing customers to complete their shopping in one trip.
• Discount Stores: These focus primarily on non-grocery items such as electronics, apparel, and home goods.
• Neighborhood Markets: Smaller stores focusing mainly on groceries, pharmaceuticals, and some general merchandise.
• Sam's Club: Membership-only warehouse clubs that offer bulk items at discounted prices.

Walmart’s sophisticated supply chain and logistics network is a cornerstone of its business model:

• Distribution Centers: Walmart operates numerous distribution centers strategically located to optimize the flow of goods.
• Technology Integration: Advanced technologies, such as data analytics and machine learning, forecast demand and manage inventory efficiently.
• Vendor Relationships: Strong relationships with a multitude of suppliers ensure a steady stream of merchandise at competitive prices.

Walmart employs various strategies to attract and retain customers:

• Everyday Low Prices (EDLP): This pricing strategy ensures that customers always receive low prices without waiting for special sales events.
• Omnichannel Retailing: Integration of physical stores with online shopping platforms allows for a seamless shopping experience, including services like Buy Online Pickup In Store (BOPIS).
• Walmart App and Walmart+: The app offers convenience and additional savings, while Walmart+ provides benefits like free delivery and fuel discounts for a subscription fee.

With more than 2.2 million employees worldwide, Walmart places significant emphasis on workforce management:

• Training Programs: Extensive training programs ensure that employees are well-prepared to meet customer needs and operate efficiently.
• Career Development: Opportunities for advancement and growth within the company help retain talent and build a committed workforce.
• Employee Benefits: Walmart offers competitive wages and a range of benefits including health insurance, retirement plans, and educational assistance.

Walmart is also committed to corporate social responsibility:

• Sustainability Initiatives: Efforts like reducing carbon emissions, sustainable sourcing, and waste reduction are central to its CSR strategy.
• Community Engagement: Walmart supports local communities through philanthropic efforts, including donations and volunteering.
• Ethical Sourcing: The company ensures that products are sourced ethically and sustainably, respecting human rights and labor laws.

How Walmart Inc. (WMT) Makes Money

Walmart Inc. (WMT) is one of the largest retail corporations in the world, and it generates revenue through various streams. Here’s an overview of the principal ways Walmart makes money:

Retail Sales

Walmart operates a vast network of retail stores, which include Walmart Supercenters, Walmart Discount Stores, and Neighborhood Markets. The company's primary source of revenue comes from the sale of a wide range of products including groceries, apparel, electronics, and household items. The retail sales segment can be further broken down into the following categories:

• Grocery Sales: With a significant focus on grocery items, Walmart offers a vast selection of fresh produce, dairy products, meats, and packaged foods.
• General Merchandise: This includes apparel, electronics, toys, and various other household goods that Walmart sells through its physical stores and online platform.
• Health and Wellness: Pharmacy services and health products are critical revenue sources, with Walmart operating numerous pharmacies within its stores.

E-commerce

Walmart has significantly invested in its online platform, Walmart.com, along with other digital services like the Walmart app. The e-commerce segment allows Walmart to extend its reach to customers who prefer shopping online. This segment includes:

• Online Sales: Revenue generated through the sale of products via Walmart’s website and mobile app.
• Marketplace Fees: Commissions charged to third-party sellers who list and sell products on Walmart’s online marketplace.

Membership Programs

Walmart offers several membership programs that provide various benefits, including free shipping and discounts. Key membership programs include:

• Walmart+: A subscription-based service that offers benefits such as free next-day and two-day shipping, fuel discounts, and access to a mobile scan-and-go service in stores.
• Sam's Club: A membership-only retail warehouse club that provides bulk purchasing options and various other benefits to members.

Financial Services

Walmart also makes money through a range of financial services offered to its customers, which include:

• Money Transfers: Walmart provides money transfer services in partnership with companies like MoneyGram and Ria.
• Walmart Credit Card: Revenue from interest and fees associated with the Walmart-branded credit cards issued in collaboration with financial institutions.
• Check Cashing and Bill Payment Services: In-store financial services that provide additional revenue streams.

Advertising

Walmart has developed a robust advertising platform, Walmart Media Group, which allows brands to advertise on its website and in stores. Revenue from advertising includes:

• Sponsored Products: Brands pay to have their products featured prominently in search results and on various pages of the Walmart website.
• Display Ads: Fees collected from brands for placing display ads on Walmart’s digital properties.