Best Buy Situation Analysis

In general, the company specializes in selling electronics, home office products, entertainment products and footwear, business programs and software, home appliances, and much more technology related products. Best Buy has earned the reputation as one of the top consumer electronics retailers and a leader in the industry. Its total revenues are $42,410,000,000, it employs 140,000 workers, and has a market capitalization of 1 1. 26 billion.The company Is a publicly traded corporation on the New York stock exchange under the signal- BY. It has gained many product and service brands that are recognized worldwide, such as Geek Squad, an in house repair service, which has been one of the company's main competitive advantages throughout its existence. The primary target market customer Is In the 16-35 age range. With 18-24 being the primary target because on average 40% are in college. Primary targets consist of businesses, both genders, middle class families and up.The secondary target i s 36-50 age groups mostly made of parents, new and small businesses, and price concerned consumers. The age group for the core audience Is 25-54 consumers 54% male 42% female and has an average household income of $75,000 (Khan, A). † Mission: The mission of Best Buy is to be the number one retailer of consumer electronics with a focus on roving a wide selection of high quality products at premium low prices while offering personable customer service and the best shopping experience both In store and online.Goals: In the company's 2014 fiscal annual report, Hubert Jolly, President and CEO of Best Buy, outlined the business transformation plan and goals as the 1 OFF shopping experience 2. Attract, grow, engage, and inspire transformational leaders and employees 3. Work with vendors to innovate and drive value 4. Increase return on invested capital 5. Continue leadership role in positively impacting the world Ochs 2 Core Competency: In terms of core competency, the key in terms of success for Best Buy has been its strategic customer-centric values and brand name recognition.Best Buy specializes in providing excellent customer service and the ability to give customers a hands- on shopping experience. Best Buy offers a wide range of products and will continue to work with vendor partners to maintain a strong relationship to guarantee low competitive prices. As far as brand recognition goes, Best Buy is increasing the amount of stores worldwide each year so the company name will continue to stick in customer's minds as well as strategic partnerships such s geek squad.SOOT Analysis Internal Factors Strengths Multiple Channel Sales Strategy Diverse Product Portfolio Reputable Brand Name Excellent Customer Satisfaction Weaknesses Geographical Concentration Limitations Reliance on Minimal Vendors Weakening Financial Position Poor Inventory Management Systems External Factors Opportunities Strategic Partnership Acquisitions Focus Towards Marketing Strategies Onlin e Sales Growth Consumption of Electronics Increasing Expansion of Retail Stores National and International – Foreign Market Penetration Threats Rise of Competitors, Loss of Market Share and RevenuesIncrease of Counterfeit/limitation Goods (China) Organized Retail Crime Increasing, Cyber Crime Threat to Security Market Shifting to Online Sales Medium to high Supplier Power Industry Analysis and Trends: The Consumer Electronics Market is continuously changing and is an ongoing process of evolution. Since technology is growing at a market. Already existing technologies are being re-invented to give the consumer a feeling that the old model(s) is irrelevant. An example is curved TV's and the phone ss.Ochs 3 These two technologies already exist however with a very slight modification, customers react and feel the need to purchase the newer version. This acts to re- invigorate what may seem to be a stagnant market. Online Sales are becoming more crucial to companies to survive in t he electronics consumer market. Amazon. Com being the leader in the industry of online sales has proved its dominance and Best Buy is increasing online retail operations to keep up. Since the recession, the market faced a decline in sales performance the last few years since 2008.However the market is making a slow, gradual come back and the situation in the industry is looking good. The fluctuating economy greatly effects consumer buying habits, and with the recovering economy conditions, consumers will have more money to spend on luxuries like electronics. According to the U. S. Consumer Electronics Sales and Forecasts â€Å"Revenues for the consumer electronics industry are projected to grow 2. 4% in 2014, reaching a new record high of $208 billion Joseph,J. ACE). Best Buy has struggled to maintain its market share with the increase of competition over the last few years but the company is growing in terms of revenue and number of stores increasing worldwide. Best Buy brand and presence is becoming well known globally and more growth opportunities are available for the company internationally. â€Å"Best Buy sees opportunities for innovation and growth in new markets and new geographies as well as in our core U. S. Business our growing global presence requires seasoned and as'. N. Y leaders to carefully manage our expanding family of international brands.Our international leadership team is focused on driving growth for our enterprise around the world (Willet, Robert, BY CEO International). † Competitor Analysis: Best Buys competitors are store-based retailers, internet-based tillers, multiple channel retailers, and vendors who offer products directly to the consumer. â€Å"They are competing amongst many others in the market for position as the top retail brand for electronic goods. U. S. Shoppers spend more than 126 billion dollars a year on electronic goods and more than 26% of it is totaled at Best Buy.For electronic purchases Best Buy remains as the top choice amongst consumers (Khan, A. ). † The major players are mass merchandisers like Walter Corporation, Amazon. Com and Apple Inc. (also a supplier). Unlike Best Buy, Walter offers much ore than Just electronics but they are growing in the electronics industry. In order to keep their prices low, Walter uses a low profit margin, high volume sales technique by squeezing their suppliers to name their price. To combat this, Best Buy must maintain their image as the ‘best shopping experience' retailer with a young, tech as'. N. , knowledgeable sales staff to assist customers and provide customer service unmatchable by Walter. In Ochs 4 addition best buy must maintain a strong, relationship on good terms with its suppliers because they are limited and also offer a price matching policy to match a rice offered by a certain store or retailer. To compete with Amazon. Com Best Buy must promote their brick and mortar, instant gratification business model. Unlike Best B uy, Amazon cannot boast physical, face to face customer service experience improvement to their website and online sales strategy since many consumers are moving towards online purchasing.One of the major risks Best Buy faces currently is the act of show-rooming. This is where customer go to the big box store to gain valuable information from the staff about a product and comparison shop, then go and purchase it elsewhere for a better price (Amazon. Mom). According to CEO Hubert Jolly: â€Å"Best Buy estimates that 1 5 percent of its customers come into the store with the intention of shortcoming, that number is only likely to increase (Macrame, M). † Since Apple is one of Best Buys vendors they must be careful with methods used to compete for customers.One of the main advantages Best Buy has in this situation is that they are actually able to offer their Apple products for a lower price than the Apple Store, while still maintaining strong customer service, warranties, and su pport as one would receive in the Apple store. New Opportunities: Best Buy faces ever rowing fierce competition as the consumer electronics industry continues to grow and new technologies are rapidly being innovated. There is much room for growth and new opportunities Best Buy can take advantage of to remain at the top of the market.One of the most significant threats Best Buy faces is the increasing amount of virtual retail sales in the consumer electronics industry, but this is also an opportunity. The first recommendation for Best Buy is to continuously innovate and improve the website to encourage online sales. Perhaps IT should undergo website redesign to offer easier web navigation/ characteristics similar to that of Amazon. Com. The second recommendation is the need to promote the advantages and benefits of shopping in store rather than at other online retailers like Amazon. Com.Such benefits include direct communication between representative and customer, fewer technologica l issues of ordering, easy returning methods, and the assurance the product will be received in perfect condition and on time rather than damaged or lost in transportation. The third recommendation is to move beyond the current business to consumer model and expand into business to business operations. This would positively increase clientele base and open up a CSS 5 huge new market segment uninhabited by many CE competitors. Next Best Buy needs to reconsider its management structure.Part of the reason for its plummets in sales was poor management style who were reluctant to change company strategy and adapt; they were not ready for competition. Best Buy has made efforts to update management which had a positive outcome. We see in the fourth quarter of the fiscal year 2013 â€Å"the company reported net earnings of $293 million, compared to a loss of $379 million in the previous period, driven by its reduced costs and improved operational efficiency. The effort of the retailer to i mprove profitability, which includes reorganization of its field and store management structure (Wolf, A). Lastly, Best Buys strengths lie in customer service so the ability to attain strong customer relationships will go far. Some ideas to accomplish this is to provide better employee training to specialize employees to understand the customers wants and needs better. This will help make the employees more knowledgeable to offer more expertise help on particular products and features that other competitors simply cannot offer, which ultimately results in happy customers. When satisfied, the company back to the top as the number one electronics retailer.

Prison Term Policy

Darrell Cook In the criminal Justice field, laws has been set and made to ensure the safety and the protection of the citizen of today. When criminals commit a crime they will be punish and will be prosecuted under the law of the crime that they have committed. When it comes to police policy, it is written to assist the courts in the sentencing, depending on the type of crime that was made.Every year the prison policies are changed, criminals that are convicted of a crime may face a longer sentence than a arson that is currently in prison for the same crime, because of the prison policies have changed. Therefore, the prison policy for convicted felonies is being reviewed by the state legislature and must be voted on, so that the bill can be passed. As a criminologist, I have done my research on arm robberies and robberies occurs when someone property is taken by force; meaning when an armed robbery is using some type of weapon to take possession of something from someone.According to my research, Armed Robberies isn't Just taking something from someone that doesn't along to you; its more than that, it's a violent offense when someone is using a firearm or some other type of weapon. When a weapon is including in an arm robbery, it is viewed a more seriousness crime, even when a person is using a fake weapon they still will be charged as an armed robbery. So in my opinion, my recommendation would be to double the maximum prison term for repeat offenders. As first time offenders I don't believed it should be double Max prison term, because in today society you have young teens that are committing arm robberies.When it moms to the young teens, there has to be a question to why they are committing such felony like this. The teens of today are committing these crimes because they are trying to keep up with the latest foot wear and clothes, because their parent's can't afford it. But I do believe and recommend that if these teens continue to commit these crimes over a nd over that they also can receive the Max prison term, like they say â€Å"if you can do the crime you can do the time†. In each state the length of sentence is different for a person that commits and convicted of arm robbery.As the criminologist, this bill going to be voted on rather to double the maximum prison term for anyone that is convicted of robbery. I think it will be a good ideal for the legislature official to review the statistics of armed robberies and the ages of the convicted felonies that commit these violent crimes. Also compare all other normal robberies that are not violent crimes. I also think that citizens of the community should be able to speak about this bill and see what they have to say about this bill being passed. Www. mygeorgiadefenselawyer. Com/Georgia-criminal-offenses†¦ /robbery

Math Ia Type 2 Stellar Numbers.

Math SL Investigation Type 2 Stellar Numbers This is an investigation about stellar numbers, it involves geometric shapes which form special number patterns. The simplest of these is that of the square numbers (1, 4, 9, 16, 25 etc†¦) The diagram below shows the stellar triangular numbers until the 6th triangle. The next three numbers after T5 would be: 21, 28, and 36. A general statement for nth triangular numbers in terms of n is: The 6-stellar star, where there are 6 vertices, has its first four shapes shown below:The number of dots until stage S6: 1, 13, 37, 73, 121, 181 Number of dots at stage 7: 253 Expression for number of dots at stage 7: Since the general trend is adding the next multiple of 12 (12, 24, 36, 48 etc†¦) for each of the stars, so for S2 it would be 1+12=13, and for S3 it would be 13+24=37 General statement for 6-stellar star number at stage Sn in terms of n: For P=9: Since S1 must equal 1 then we can prove this formula by showing that:So the first six t erms are: 1, 19, 55, 109, 181, 271 Therefore the equation for the 9-Stellar star at For P=5: Since S1 must equal 1 then we can prove this formula by showing that: So the first six terms are: 1, 11, 31, 61, 101, 151 So the expression for 5-Stellar at General Statement for P-Stellar numbers at stage Sn in terms of P and = For P-Stellar number equals 10: For P-Stellar number equals 20: The General Statement works for all number fro 1 to positive infinity.The equation was arrived at since the sum of arithmetic series can be found using , since the difference is always 2P then we can replace 2P with d, and since u1 is always equal to 1, we can replace it with 1 every time. The at the end of the equation serves the purpose of making the difference between the numbers in the series constant. This form of the equation will allow for only one variable to change, which will be . One of the things the student realized while solving this investigation was that the second term is always equal to , but the derived equation which is also works.

HDI measures the outcomes of the development process. Basic needs and Essay

HDI measures the outcomes of the development process. Basic needs and the Milllenium Development Goals offer strategies by which to achieve such development. Explain and discuss - Essay Example The setting of the Millennium Development Goals (MDGs) called for a measure to evaluate the progress. There the HDI was developed as an alternative measure of the development recorded from using per capita income as before. Using Human Development Index has been seen as a better way of developing a reliable report especially in the drafting of HDR as in the past development was measured in terms of income only (Jahan, 2001). Per capita income had been seen as a good way of doing such an evaluation as in cases where it is high it shows that the economy is strong and that should also translate to other facets of the same government. However, with the introduction of the Human Development concept in the 1990s, it has been established that there is a need to develop a better means in which the development can be measured. This was followed by the publication of the Human Development Report (Jahan, 2001; United Nations Development Program). Therefore, to realize real development, alternative methods such as the HDI are used to consider issues such as poverty, health and income which are covered in the MDGs. Pribula, P. (2010). Human Development Index: How to Cope with with its Limitations. Web. http://www.globalpolitics.cz/clanky/human-development-index-how-to-cope-with-its-limitations Accessed January 10,

Writrer choice Essay Example | Topics and Well Written Essays - 750 words

Writrer choice - Essay Example The notion that only African, as opposed to other races, were only fit to serve as slaves was an invention of whites who were in need of a working class.2 The working class, however, had to be legitimized; the legitimacy was that Africans could not fit elsewhere, but in the institution of slavery. More specifically, this paper compares the works of David walker’s appeal to the colored citizens of the world and Leslie Harris’s in the shadow of slavery. It will be argued that class was fundamental in institutionalization of the racial slavery, and the race solidarity in New York in the seventieth century. David Walker is a male abolitionist of an African- American origin. Further, the outspoken abolitionist was born to a slave father, but the mother was a free black mother.3 However, owing to the status of his mother, David Walker enjoyed that status of being a free black person. The author used his position as a free person to speak against the evils of slavery. In this work, appeal to the colored citizens of the world, the author writes against the evils of slavery in a bid to draw the attention of African American to a need for abolition of this practice. The first goal of his writing is to encourage the solidarity of African living under slavery. Walkers’ position as a free African during a period when slavery is ubiquitous in New York is likely to be instrumental in luring slaves into seeking a free African status. Whites during this era of slavery in New York have established a social class, and justified their actions as far has holding slaves is concern. In essence, the white slave owners believe that Africans are inferior, and do not belong to the social class of whites.4 To illustrate this, the author writes, â€Å"Has Mr. [Thomas] Jefferson declared to the world, that we are inferior to the whites, both in the endowments of

Principles of Health and Social Care Practice Essay

Principles of Health and Social Care Practice - Essay Example This paper discusses that  there is also a need to respect the choice of clients. Sometimes making choices can be quite hard especially when the choices are limited. Healthcare workers should ensure that when clients need to make choices over matters that affect them, the choices available to them are enough not to cause agony on what course of action the clients will take.   For instance, healthcare settings should be structured in a manner that can allow clients with restricted mobility access to areas that they need to. Furthermore, respecting the confidentiality of clients is very significant as clients trust healthcare workers to do that. Breaching this trust will catastrophically affect the healthcare worker-patient relationship.This research declares that  giving a client all the relevant information concerning his/her treatment brings more satisfaction and happiness to the client because the client can make choices based on the information that he/she receives. Through the person-centred approach, the patient is able to easily approach the service provider.  This approach encourages the service provider and the client to work as team. In this manner, the provider is able to meet the client needs effectively while respecting their individuality. This approach makes it possible for a provider to be more specific in addressing the needs of a client.  The patient also feels more responsible and thus he/she is likely to take measures to â€Å"engage in treatment decisions, feel supported to make behavioural changes and empowered to self manage†.

Microsoft Introduction Research Paper Example | Topics and Well Written Essays - 750 words

Microsoft Introduction - Research Paper Example Bill Gates was the first president while Paul Allen was the executive vice-president (Nell 12) Microsoft a corporation, like others has goals, vision and mission. The vision of Microsoft is to create accessible innovative technology, which sheds light on its mission which is to make people and businesses all over the word to realize their potential. The company’s main focus is on software products and services where they develop and also license them. Microsoft operating systems is among its products that mainly allow a computer to operate. Microsoft has packaging software called Microsoft Office that is used in an office set up which include word processor and spreadsheet among others (Randall 22). Microsoft has had three C.E.O’s since it was found with Bill Gates as the first one and Steve Ballmer being the second. Sadya Natella is the third and current C.E.O of Microsoft. He has been working with the company for more than two decades and he is famous for pushing vigorous changes in the company’s culture and products. This has led to him having a reputa tion of proven potential and capability of being the C.E.O of a big corporation like Microsoft. The company’s main headquarters is on One Microsoft way, in Redmond, Washington, United States of America. Microsoft has put a lot of effort to make sure most parts of the world are experiencing its availability. Branches of Microsoft are mainly found in the United States of America with its subsidiaries in more than seventeen countries. Some of these countries are France, India, Canada, Nigeria and Peru, which mostly deal with its software and programming industry. Microsoft is estimated to have one hundred and twenty eight thousand employees (128,000). Microsoft has been focusing keenly on expanding its markets in all the continents of the world to keep up with competition in the computing world. There are three subsidiaries that I have chosen for this project and they are Microsoft

Age discrimination and its effect on the over 30s in todays workplace Research Paper

Age discrimination and its effect on the over 30s in todays workplace - Research Paper Example Age discrimination is all about taking the focus from job competency as reflected in the skill levels and placing it on the individual’s calendar age. Most people tend to view age discrimination as an aspect that relates to older employees but the fact is that ageism involves young employees too. This is for the reason that there are age restrictions that are illegal and their sole intention is to bar young people with proper educational credentials simply because the employer thinks that the credentials will hinder them from performing their duties as expected (Macnicol 3). Pension reforms were ushered in with the advent of industrialization. Social security in form of specified pension amounts lured older employees into retirement as the schemes had financial benefits. However, after the Second World War, the professional arena experienced a change that saw the entry of the younger generation and modern technology into the workplace (Sargeant 27). â€Å"Discrimination exist s in the minds of those that believe they have the right to exercise abusive authority and control over the powerless, the poor and the oppressed† (Hullet 28). This was the genesis of age discrimination as employers started viewing the ‘old’ employees as a professional burden that lacked the required technical know-how, conservative in their style of work, and above all lacked the zeal to work (Macnicol, 14). Nonetheless, there were those employers who stuck with the ‘old guard’ as they felt that the young were immature and inexperienced to enhance their productivity. Another fact that led to the cropping up of age discrimination was the low output achieved by older employees as they were incapable of keeping abreast with the new technology. Even so, their pay was high and they could not be fired because they had a lifetime employment policy. This made employer to review their policies in favor of the young thereby creating age discrimination. General ly, it can be said that age discrimination affects all age groups. Companies, on the other hand, view hiring young people as expensive as they will require further training and close supervision. They also have reservation on hiring old people because they tend to think that they will not get value for their money as older people will work for a short time before retiring and they are expected to pay out their retirement benefit. Age discrimination on a global scale and the USA Age discrimination is a worldwide phenomenon that affects every society in the world. However, this review will look at the European Union and the United States. â€Å"There is ample evidence that discrimination takes place in the EU† (Macnicol 45). Every standpoint has its own definition of old age, for example, in the statistical aspect old age is considered 60 to 65 years of age as pertaining to retirement or social program entry eligibility (Grobe 12). The European commission ranges old from 55 to 65 years of age. However, a 40 year old is defined as an old worker in the United States of America. Even though the current economic crises mostly affected the young people in Germany, there was also

Philosophy and Politics, East and West Essay Example | Topics and Well Written Essays - 1750 words

Philosophy and Politics, East and West - Essay Example Confucius’ social and political philosophies are both rooted in the idea that one should learn self-discipline and treat others with love and concern. He argued that men are responsible for their own actions with regard to how they treat others. Confucius also believed in harmony and having a relationship with the other person, like a father to his son or a mother to her daughter. He also believed in social harmony, which is the great goal of Confucianism. Confucius believed that everyone had a role in the social order and must be do their part in that society. Confucius’ social philosophy is known as Ren, which means being altruistic, compassionate, and loving toward others. This concept means that one should avoid speech that would result to negativity or the appearance of negativity. He also taught that only those who learned self-discipline could accomplish altruism. Ren is to be considered a practice that is broad, and informs one’s interactions with other p eople. Confucius noted that one should not use their social power to oppress those of the lowest power. Instead, one should treat others with respect, the same way one would want to be respected. This is what makes the idea of the superior man in Confucian philosophy. Another part of his social philosophy is Li, or etiquette, rituals, and morals. ... Virtue would enable a ruler to maintain good order without trouble or without relying on his officers and deputies. He believed that in order for a ruler to maintain virtue, an individual must master the practice of Li. Practicing Li, or etiquette, through ceremonies that express humility and thankfulness, gift-giving rituals, acts of politeness, would result in efficacy for the ruler. As said in Confucius’ Analects: The Master said: â€Å"Lead the people with administrative injunctions (zheng) and keep them orderly with penal law (xing), and they will avoid punishments but will be without a sense of shame. Lead them with excellence (de) and keep them orderly through observing ritual propriety (li) and they will develop a sense of shame, and moreover, will order themselves.† (2:3) Confucius’ political philosophy is also rooted in self-discipline, and treating others with love, compassion, and concern. In this area, Confucius had a theory called Zhengming. This re ferred to rectifying the behavior of people so that it corresponds to the language they identify and describe themselves with. Confucius believed that this rectification should start at the top of the government, where he believed the discrepancies originated. If the ruler’s behavior has been rectified, those beneath him will follow and do the same. It is this way of thinking that Confucianism, and all the Chinese philosophies thereafter, developed a political philosophy that is strongly centered on a cultivated social and political merit system. Confucius also held that the concept of Zhengming is important or integral in his ideas of political meritocracy. The proper rectification of names, terms

The Parable of the Good Samaritan Essay Example | Topics and Well Written Essays - 1000 words

The Parable of the Good Samaritan - Essay Example The man of law asks for an interpretation of the law. What is said by Jesus is told in the form of a story, which is known as the Parable of the Good Samaritan. The parable is not an explicit answer, but is an answer that provides the story in such a manner as to provoke thought and further conversation. This story is an essential form of teaching where the teacher poses the situation and the student draws from it the lesson. The story that Jesus tells is that of a man who is robbed and those who see his plight and their reactions. The first is a priest who walks to the other side of the road in order to avoid him. The second is a Levite who also walked to the opposite side of the road to stay uninvolved. The third is a Samaritan who provides the man with help. The Samaritan goes beyond simple help, giving him a ride to a village and asking an innkeeper to look after the robbed man until he is in health. During the process of providing health, the Samaritan bandaged his wounds, used oil and wine on him to help heal him, and let him ride on his donkey. He offers to pay the innkeeper for his service and any extra service that the robbed man may need. The question that Jesus, as the Great Teacher, poses to those hearing him is â€Å"Which of these three do you think was a neighbor to the man who fell into the hands of the robbers?† (Luke:36). The lesson is taught through an example, but without providing the answer to those he is teaching. He expects that through His example, they will find the answer of their own accord. The location of the parable is identified by Hughes and Laney (2001) as the Jordan Valley which is a bit north of the Dead Sea. This route which runs through Wadi Qilt is filled with rocks and rugged terrain where robbers could ambush travelers. There is no specific time given for this story, and it is just as likely that it is a story of example rather than a related story from history. The location makes it likely that the three traveler s who passed by the robbed man might be there, but allows for the significance of the Samaritan to shine through. The location is significant as it is a man traveling from Jerusalem to Jericho, which indicates that he is traveling from morality into lands of less. Hultgren (2004) relates the belief of Augustine who suggested that this descent represented man’s descent from what was holy and immortal to that which was not and was decidedly mortal. The road is a literal descent as it starts at Jerusalem which is at 2700 feet above sea level but ends at Jericho which resides at 850 feet below sea level. Interpretation Chapter ten of Luke begins by describing a mission that is given to seventy-two of Jesus’ followers. He sends them out to gather more believers through their various acts in His name. He expects an exchange from those the followers encounter. If they are welcomed, then they give the gifts that He has given them the power to give, but if they are rejected the y are to make clear that they have rejected men of God who are on His mission. He says to them â€Å"Whoever listens to you listens to me; whoever rejects you rejects me; but whoever rejects me rejects him who sent me† (Luke 10:16). In this case, when he gets to relating the parable, it can be said that he is relating the robbed man to his followers and those who accept them as neighbors as they are then given remedies

Manufacturing and Service Technologies Essay Example for Free

Manufacturing and Service Technologies Essay Manufacturing and Service Technologies technology refers to the work processes, techniques, machines, and actions used to transform organizational inputs into outputs. One important theme in this chapter is how core technology influences organization structure. Understanding core technology provides insight into how an organization can be structured for efficient performance. Core technology is the work process that is directly related to the organization’s mission. A non-core technology is a department work process that is important to the organization but is not directly related to its primary mission. Woodward developed a scale and organized the firms according to technical complexity of the manufacturing process. Technical complexity represents the extent of mechanization of the manufacturing process. High technical complexity means most of the work is performed by machines. Woodward’s scale consists of ten categories and these categories were further consolidated into three basic technology groups: The groups are consisted of small-batch and unit production, large-batch and mass production, and continuous-process production. Small-batch production relies heavily on the human operator; it is thus not highly mechanized. The large-batch is manufacturing process characterized by long production runs of standardized parts. In continuous-process production, the entire process is mechanized. Overall, the management systems in both unit-production and continuous -process technology are characterized as organic, as defined in Chapter 4. Mass production, however, is mechanistic, with standardized jobs and formalized procedures. When adopting a new technology, realign strategy, structure, and management process to achieve top performance. Lean manufacturing uses highly trained employees at every stage of the production process, who take a painstaking approach to details and problem solving to cut waste and improve quality. Lean manufacturing techniques have been implemented in hundreds of organizations all over the world and have led to dramatic improvements in quality, productivity, and efficiency. Service technologies are different from manufacturing technologies and, in turn, require a different organization design. The most obvious difference is that service technology produces an intangible output, rather than a tangible product. Hence, service organizations may have an organization structure with fewer boundary roles, greater geo-graphical dispersion, decentralization, highly skilled employees in the technical core, and generally less control than in manufacturing organizations. The feature of service technologies with a distinct influence on organizational structure and control systems is the need for technical core employees to be close to the customer. The impact of customer contact on organization structure is reflected in the use of boundary roles and structural disaggregation. The text also introduces Non-Core Departmental technology, as the section that shifts to the department level of analysis for departments not necessarily within the technical core. The framework that has had the greatest impact on the understanding of departmental technologies was developed by Charles Perrow. Perrow specified two dimensions of departmental activities: Variety and Analyzability. Variety is the frequency of unexpected and novel events that occur in the conversion process. Analyzability is when the work can be reduced to the mechanical steps and participants can follow an objective, computational procedure to solve problems. The dimensions of variety and analyzability form the basis for four major categories of technology: routine, craft, engineering, and nonroutine. (Daft) The text discusses both core and non-core work processes and their relationship to designing organization structure. The nature of the organization’s work processes must be considered in designing the organization for maximum efficiency and effectiveness. The text illustrates that forces affecting organization design come from both outside and inside the organization. External strategic needs create top-down pressure for designing the organization in such a way as to fit the environment and accomplish goals. This illustrates that today’s companies is that strategy, structure, and technology need to be aligned, especially when competitive conditions change. For example, several years ago, Dell created a business model to uild personal computers faster and cheaper, other computer manufacturers had to realign strategy, structure, and technology to stay competitive. Dell made PCs to order for each customer and sold most of them directly to consumers without expense of distributers or retailers. IBM for example, tried to differentiate their products and charge a premium price switched to a low-cost strategy, adopted new technology to enable them to customize PCs, revamped supply chains, and began outsourcing manufacturing to other companies that could do the job more efficiently.

American Revolution Essay Example for Free

American Revolution Essay Black American also referred to as African Americans are the US citizens with an African origin. Some of them are descendants of survivors of Africans who were brought to America as slaves to work in sugar plantations. Other black communities in America are as a result of voluntary immigration from the African community. African Americans make the largest minority group in the present United States of America. The African American community has for a long time been neglected and discriminated, they had little or no rights at all, which caused them to form movements to fight and campaign for the recognition of their rights. In the United State, women have been facing harsh treatments from their male counterparts. They have also been denied quite a number of rights. This research is intended to look into the similarities and differences that exist between the progression of the black Americans and American women in the United States. (Felder, 1990) Progression of blacks For many years, blacks Americans in the United States have been the poorest community in the country. They were regarded as slaves and had no rights to own properties and work. As time went by, they were allowed to grow crops and keep livestock. Though they could intermarry with other communities, they were still poor and could not have right over their spouses married from other communities. African Americans were regarded as immigrants to the country and therefore taken inferior to the indigenous communities. After several attempts to fight for their rights, they formed movements to champion for their rights as other communities in the United States. These movements were fighting for equality in different sphere of life including the right to own properties, the right to employment, to vote, and others. The civil rights movement started in early 20th century. These movements were encouraged by the extending role of the government in developing the economy and society. This encouraged the starting of businesses and jobs for blacks, the establishment of judicial law to protect the rights of all Americans rather than protecting businesses and whites only. The former US president, Mr Franklin Roosevelt, who was in power by then, appointed the judges who favored the rights of African Americans. Mr Hugo Black was appointed to head the Supreme Court as the judge. This contributed to blacks accessing schooling like whites without any sort of discrimination as before. The government was clearly supporting the rights of the black community in championing their rights. At the start of the Second World War in Europe, African Americans brought their demand to fair treatment than it was during the First World War. They said through Medias that for them to contribute in the war, African Americans enrolled in the military had to be trained like their white counterparts while other civilians were to work in the same industries the white worked. In 1941, blacks organized a march to Washington lead by Randolph Philip A. to demand the government to have blacks contracted in the defense department as the whites. This encouraged the government to order the creation of equal employment committee to enforce the practice of fair employment. The formation of the committee did not solve the matter but discrimination of the blacks went on. During the war, though the blacks contributed to about less that a quarter of the military personnel, they were trained as pilots in the armed forces without any discrimination. This did not fully solve the matter for there were others who were put in a delicate position without any combat. After the government allowed the equal employment of blacks and whites, many blacks migrated to north for employment in war industries than they had migrated to south during the First World War. This migration was encouraged by an urge to have a much better incomes as others. There was much tension in their new homes in fear of racial oppressions. Those who migrated to the north had to use their economic and political influence in supporting civil right for those who were left in south. (African-American, 2008). The blacks had gained much influence and were widely working against racial discrimination and were even challenging the registrar of voters in southern courthouse and could sue school boards for equality in education provision. The movement was gaining after the blacks were able to fight racism in Europe and in America. The war encouraged more blacks to fight racism in Europe and later extended to Asia. After the war, the blacks had gained momentum which encouraged the president to have uniform civil rights in the country but was rejected by the congress. This movement helped the blacks to have most of the rights that were initially enjoyed by the whites only including right to education, right to vote, and right to participate in politics. Since then, African Americans have greatly enjoyed full rights of citizenship of the United States. As a result of this, blacks are able to strive for higher seats in the government and in other areas. Recently the blacks have progressed to a point of vying the highest seat in the country. Example of this is Illinois senator Mr. Barak Obama. (History made, 2008) After the war, rights movement continued with a success, different forms of discrimination had already been overturned and this time it was on equal education provision and opportunities. After much emphasis on equal education provision that challenged primary and secondary education, the court ruled that segregating racial education was against the constitution. Segregating education faced a major challenge by whites opposing the ruling of the court; this called the whites to have mass resistance in complying with the segregation orders. Firing the black school employees who were on the favor of segregation was another tactic that was used by the whites and creating whites private schools other than boycotting the integrated schools that incorporated both races. During the first years, the schools were not desegregated, but this gradually proceeded as the schools as the segregation had already taken part in the neighborhood. In overcoming this some schools sent their students in different neighborhoods. After much struggle by the whites to fight segregation, they formed a group called Ku Klux Klan (KKK). The group used all form of violence and threats against anybody who was supporting the desegregation or the rights of the blacks. With support from the media they performed all forms of terrorism especially in the southern states in the early second quarter of the 20th century. Though there were still threats and violence, this did not end the struggle for the rights of the blacks, it had to move beyond the education provision to challenge other affected areas like in public transport and other public service provisions. The black community was annoyed by the whites for being rude and abusive. A bus boycott was organized in Alabama after a white passenger expected a black passenger to excuse him from the bus seat, this kind of harassment contributed to organizing for a boycott within a night which was a success, this called in court attention and the segregation in busses were to start immediately factors that helped in ending the continuous harassment of the blacks by the whites in the city. Martin Luther King who chaired the Montgomery Improvement Association, organized a boycott through his organization, King’s plea to Christians was to create a non discriminatory impression of people in the whole country. King wanted the violent and harsh ways to a non violent way of encouraging segregation. In the University of North Carolina, four black students started yet another protest against the whites’ only counters, though it was not a new for of protest, it had spread through out Carolina within days, this lead to desegregation of restaurants across the southern states. This movement showed clearly that whites and blacks are alike and they could show they were against segregation openly. The students found a nonviolent committee in 1960, the formation of the committee was to help the students organize sit-ins movements. It was encouraged that civil rights movements should only be based on individual communities of the blacks. This was to enforce change to the local communities rather than the national change. The voters’ registration campaign started in 1964, though the community level activism had started in 1961, there was a heavy commitment in heavily concentrated black territories mostly in rural areas of southern states. The blacks believed that voting was the only way to empower them and had to ensure that they participated in changing of the racism policies in the south. The activist Robert Moses through Student Nonviolent Coordinating Committee (SNCC) worked hard in registering blacks and teaching them the importance of voting, skills the required and the necessary responses applying for voter registration. The exercise faced a great opposition from the whites they went a head in threatening Robert and even beating and sending him to jail. The efforts of Mississippi to recruit both whites and blacks in colleges and other professions were thought to attract attention from the whole nation. This lead in having more active politician who later formed Mississippi freedom democratic party (MFDP) after they were rejected by the white democrats as members in their delegation. The actions of the whites were challenged when the blacks participated in the media interviews to represent Mississippi. The voting right was initiated by the blacks and began protesting in court houses in Selma, when they were unsuccessful, they proceeded to Montgomery where they faced police beating and were tear-gassed, the scene was televised and shocked many, this encouraged King to lead hundreds of people to a 50 mile march to Montgomery . The Selma march got great supports which in turn lead to enactment of the law which protected southern states blacks to vote. The president Johnson proposed the passage of rigors act by the congress in the 1965. After the amendment of the act, most of the requirements that restricted the blacks from voting were suspended. After this, the blacks were able to vie for major offices seats and were able to win in all districts. (Martin Luther King, Jr. 1958 ,46 ) Progression of women in the US Though the republic of America was founded on ideas of equality, liberty and freedom, it proved to be difficult to achieve in practice. Women in the United States were not regarded as equal to men despite of their important roles they played in forming and shaping the US. Their lives were confined in the domestic world and were not given enough chances to spearhead their causes in the education, social and in political arena This led to the rise of women activism in politics. They started realizing the power of politics in constructing women identity in the society. They realized that they could also play an important role of Republic motherhood by instilling republican and freedom values to their children. There were few women like Abigail Adams, Mercy Otis Warren, and others who become prominent public figure in the political arena. They championed for the rights of women. (History of women, 2008) During the American war with the British, women played great roles like boycotting of British goods and contributing to the economy of the country. They held several demonstrations that opened their eyes to some issues rather than being at home with their children. Some women participated in political activism that progressed women to another level. Some women participated in the in the progression of women by serving in the army. Although it was considered abnormal for women to enter in the war, most of them broke these rules and directly participated in the war. Other women like Deborah Sampson played the role of men in order to be allowed to enter into the war and fight in the front line alongside men. (Morton, 1980) She presented herself as a volunteer using male names to be recruited in the army. The last time she participated in the war, she was recognized as Robert Shertliffe. She served under the command of Captain Nathan for three years performing various duties until she was injured and could no longer continue fighting. She was later relieved of her duties and rewarded for the role she played in the army as a revolutionary warrior. Women played great roles in shaping the future of the counterparts. With the laid foundation by former women, modern women are able to compete with their male counterparts for the big positions in the job market, politics and in education achievements (Ellet, 1969). Hilary Clinton is a good example of a woman who has fought against the odds and was competing for the highest seat in the country. Another example is John McCain’s running mate, Sarah Palin who would be the vise president if McCain wins; another woman who has fought to the higher seat is the American secretary of states Condoleezza Rice. (Mark, 2008) Similarities of blacks and women in America There are several similarities between the blacks and women in the United States. At first, they were regarded as people who were not much important to the society and their work was to serve the white man. They had to proof their capability in order to be regarded as important figure in the community. With formation and participation in movements and demonstrations, they found objections and were termed as illegally demonstrating and were facing brutal beatings and other sort of punishments. Blacks’ participation in the movements and protesting the rule of whites brought about a great change that its impact is felt in the modern America. Blacks have equal rights as whites in the country and the can access anything as their fellow whites are accessing. Were it not for the activists who volunteered and fought against the poor treatment of women by men, women could still be â€Å"stay at home mom† as they used to be. Blacks and women have climbed the ladder to the righted world and they have the right to do whatever a man can do (Wikipedia, 2008). In the current America, being a woman or black has no restriction in exercising ones right. None has more rights than the other and are all protected buy human rights which has not specified the race, religion or gender, provided its human being. The voting right was initiated by the blacks and began protesting in court houses in Selma, when they were unsuccessful, they proceeded to Montgomery where they faced police beating and were tear-gassed. The scene was televised and it shocked many people, which encouraged King to lead hundreds of people to a 50 mile march to Montgomery. The Selma march got great supports which in turn lead to enactment of law which protected southern states blacks to vote. The president Johnson proposed the passage of rigors act by the congress in the 1965. After the amendment of the act, most of the requirements that restricted the blacks from voting were suspended. After this the blacks were able to vie for major offices seats and were able to win in all districts. As each has gained the right to vote is a very important role in the welfare of the country, with all participating, democracy is exercised and only with majority supporters gains the access to any political seat. Conclusion The movement of civil rights in the United States has gone through major challenges before achieving a tremendous success. The total commitment of the activists was of benefit to the whole nation’s blacks and women. The recognition of capability of blacks and women has brought equality and has contributed to the growth of the economy. The movement also helped the blacks to access education like any other American without discrimination and also led to segregation of schools and other public services. The enactment of voting rights gave the blacks and women an opportunity to exercise politics like their white counterparts which in turn brought a better service provision to all citizens. Participation of blacks and women in national welfare activities like in war led to victory of the nation. Reference: African-American, 2008, retrieved from www. en. wikipedia. org/wiki/African_American on 3rd 10/2008 Ellet, E. 1969, The women of the American Revolution, New York; Haskell Felder, J. 1990, Black Origins and Lady Liberty, Daily Challenge. July 16, History made, 2008, Obama becomes first nominee of major party, retrieved from www. elections. foxnews. com/2008/08/27/history-made-obama-becomes-1st-black-nominee-of-major-party History of women, 2008, retrieved from www. en. wikipedia. org/wiki/History_of_women_in_the_United_States on 3rd 10/08 Mark E, 2008, career progression of minority and women, retrieved from /www. defenselink. mil/prhome/careerprog. html, on 3rd 10/08 Martin Luther King, Jr. 1958, Stride Toward Freedom New York: Harper Row Morton, M. 1980, The Liberty Daughters: the Revolutionary Experience of American women 1750-1800. Boston: Little brown Retrieved from www. African-American_Civil_Rights_Movement_ (1955-1968). htm on 3rd10/08 Wikipedia, 2008, African-American civil rights movement (1955-1968)

Role Of Education In Contemporary Society

Role Of Education In Contemporary Society Discuss functionalist approaches to the role of education in contemporary society This essay will look at functionalism and the approaches held within and use these approaches to explain the affect they have on the role of education in contemporary society. The functionalists approach has been fundamental in helping towards the goal of understanding behaviour and the world we live in. and this methodologies used. This essay will discuss and analyse some key points surrounding these methods and it will highlight the strengths and weaknesses identified in within these methods. The functionalist approach is one of several different perspectives within sociology. Functionalism is a structuralist theory, and sees the individual as less important than the social structures of organizations in society and looks at society as a whole rather than individuals within it. The functionalist approach looks at society as though it was a human body, each part of the body has a function to keep it alive and healthy and each part of society helps to keep society going. (Tony Bilton 2009) Functionalists believe in maintaining consensus, a general agreement between societies as a hole of widely shared values and beliefs. The functionalist approach believes that as individuals we all have a shared responsibility to use the functional prerequisites set out for us such as the NHS, government and Education Services. Education is a term used to describe knowledge and skills acquired both within and outside educational institutions. Education is always changing and research is ongoing, as is research on the provision for achievement for all abilities. The ultimate goal of education is to provide the best possible education. (Tony Bilton 2009) Functionalism is largely derived from sociologists such as Emile Durkheim( 1961)and Talcott Parsons. The Functionalist approach explains that by studying the relationship between education and other social institutions that the educational system does not function alone, it makes a positive contribution to society as a whole. For without society functioning as a whole and without the realization that the individual is part of something much bigger than themselves, social life would be unfeasible, thus making Durkheims Social solidarity a fundamental part of functionalist thinking. (Haralabos 2010 ) ( )Durkheim saw the educational system as a way to be taught societies, norms and values. Durkheim believed that people are placed into education in order to learn life skills which will in turn set the foundations for future employment. This enables people to fulfil roles in society and develop a social conscience, which Durkheim labelled conscience collective and play their part in the division of labour. Durkheim argued that children need to learn to become part of society and education helps with this and it also helps the child to survive in society. Durkheim believed that the education system was better at teaching certain aspects of social rules than that of families or peer groups. He also thought that being taught punishment and self discipline in the educational systems would help the individual see that bad behaviour would not only effect the individual but would also effect society as a whole. It was Durkheims belief that being taught subjects such as History would help children feel an attachment to society and enable them to become more commited to their social groups and this would have a positive effect on the greater good of society. Durkheim viewed the education system as a miniature society and a model of the social system (Haralambos 2010) As effective as Durkheims view of education is there are still some issues surrounding his theories that can be argued like how can the transmission of social solidarity and shared values be correctly measured especially when looking from an interactionist against society as a whole and can one assume that each individual is going to learn the exact same values and social norms when schools teach in different ways and pupils interpretation on things are different. Although Durkheim Although Talcott Parsons(1961)was in agreement with Durkheims view of the education system representing a miniature society argued that the education system acts as stepping stones between the family and society. Parsons states that primary socialization takes place within the confounds of the family and this is where particularistic standards will be placed on the child. However to move on to universalistic standards, the focal socialization is then taken over by the school thus Ensuring children are prepared for their adult roles in society. This ensures the child moves from the ascribed status of the family on to the achieved status and universalistic values of adult society. Parsons believed the basic values of society were taught through the education system and that value consensus was inevitable for society to function resourcefully. Parson argued that each individual regardless of background could significantly achieve in the education system and that equality of opportunity was based on meritocratic principles. Parsons viewed the school as a vital tool in assisting role allocation that each job would be correctly matched to the skills of that child. Davis and Moore (1967) came from a different viewpoint than that of Parsons they agreed on the concept of role allocation but linked it more to the idea of social stratification, they argue that inequality is needed to ensure the most important and influencial roles in society are filled with the most skilful and intellectual members of society. They believe this is done through a filtering process whereby individuals are put into categories and graded on their performance, those that achieve higher qualifications can then get higher positions in society. If individuals were assigned to the wrong roles this would have a negative effect on society and the education system would be seen as failing and this would bring about a degree of inefficiency. that the education system is essential in preparing youngsters for their forthcoming roles in society Parsons believed the basic values of society were taught through the education system and that value consensus was inevitable for society to function resourcefully. Parson argued that each individual regardless of background could significantly achieve in the education system and that equality of opportunity was based on meritocratic principles. Parsons viewed the school as a vital tool in assisting role allocation that each job would be correctly matched to the skills of that child. Davis and Moore (1967) came from a different viewpoint than that of Parsons they agreed on the concept of role allocation but linked it more to the idea of social stratification, they argue that inequality is needed to ensure the most important and influencial roles in society are filled with the most skilful and intellectual members of society. They believe this is done through a filtering process whereby individuals are put into categories and graded on their performance, those that achieve higher qualifications can then get higher positions in society. If individuals were assigned to the wrong roles this would have a negative effect on society and the education system would be seen as failing and this could bring about a degree of inefficiency As effective as Durkheims view of education is there are still some issues surrounding his theories that can be argued like how can the transmission of social solidarity and shared values be correctly measured and can one assume that each individual is going to learn the exact same values and social norms when schools teach in different ways and pupils interpretation on things are different.

Butcher and His Fiend Like Queen in William Shakespeares Macbeth Essay

Butcher and His Fiend Like Queen in William Shakespeare's Macbeth I do agree with this judgement of Macbeth and Lady Macbeth, but only in some aspects of the play by William Shakespeare. There are many arguments for this judgement; these will be discussed in this essay. In act one scene two Macbeth is portrayed as a heartless, merciless and brutal warrior. We get this impression of Macbeth from the report that is given to King Duncan by the captain; "For brave Macbeth (well he deserves that name) Disdaining fortune, with his brandish'd steel, which smok'd with bloody execution" this quote explains how Macbeth is a brave warrior in the face of battle and is not scared of any man. Throughout this play Macbeth has a wild ambition for power. Macbeth craves the power so much he will kill for the title of the king. Killing the king in the time of William Shakespeare is regarded as the worst crime possible. Macbeths craving for power is surfaced after he meets three evil witches in Act one scene three; who prophesise he is to be Thane of Glamis, Thane of Cawdor and to be king there after. "All hail Macbeth, hail to thee Thane of Glamis. All hail Macbeth, hail to thee Thane of Cawdor. All hail Macbeth, that shalt be king hereafter." After hearing this Macbeth is shocked to hear this news as being Thane of Cawdor is a huge title to his ears, let alone being King. As the witches quickly move away Macbeth is curious to know more and what these creatures are speaking of: "Stay you imperfect speakers, tell me more" Macbeth wants their statements to be true and therefore tries to find out more information about what he could be in the future.... ... greedy temperaments cost them their lives, they both are never happy again because they committed the worst possible crime in Scotland, just to be king and queen for a short period of time. Therefore the description of Macbeth as a butcher is false. Butchers are heartless mean men who kill with no regret. Macbeth regrets his actions and therefore he suffers for the rest of his life. Lady Macbeth is even weaker than Macbeth in the final acts; she commits suicide whereas Macbeth faces his fate. Lady Macbeth makes out she is a strong figure and makes Macbeth look up to her with her harsh words and persuasive techniques, she is "fiend like" as she manages slyly to persuade Macbeth to commit the murder. Although Lady Macbeth does not kill Duncan she cannot handle the pressure like Macbeth and they are never happy again.

My Favorite Kind of Vague :: Personal Narrative Jealousy Envy Essays

My Favorite Kind of Vague When dreams mix with realities it’s 2 o’clock on a Sunday morning, and no one is awake but you, scribbling on a notebook pad behind the bathroom door, trying to grasp how something so mild, how heartwarming, could be converted by its counterpart. I read this book last summer, it was required reading, everyone told me it was horrible. The book takes place in the south at this boy’s boarding school called Devon during the summer session, in it Gene, this guy with a terrible sense of self and an even worse self-esteem, engages in a codependent relationship with the magnificent athlete Phineas. Everyone loves Finny, he’s charming, he’s naive, he’s everything Gene isn’t. So anyway, Gene is jealous of Phineas, although they’re best friends, so he develops this concept of Finny being jealous of him, justifying the hatred he develops for him. It becomes apparent that Phineas isn’t at all jealous; Gene’s, consumed with envy, and pushes Finny out of the tree they used to jump out of together, essentially killing his best friend. It’s strange how literary life parallels life so perfectly sometimes. But it really is a good book, I recommend it. But who am â€Å"I†? Well, allow me to introduce myself. I’m Beth. Some may accuse me of being antisocial, but I’m not. I mean, sure, I get calls all the time, but they’re for homework help and advice on weak poetry. It’s not that I mind it; it’s just that I don’t exactly enjoy it. When I was in seventh grade, I cracked a book open at my father’s library, you should probably know he’s a librarian. It was called â€Å"Popularity in 100 steps.† I remember a few guidelines from it â€Å"Be nice to others,† that means listening to them, and giving good advice another was â€Å"Try not to be pessimistic,† another â€Å"Use your fashion sense† and then the big 100 was â€Å"Be yourself.† Well, I’d been being myself for 16 godforsaken years, and it was time for a change. I met her in a hallway, at the time squirming at her singing, her faà §ade of giddiness. She could have authored the awe-inspiring â€Å"Popularity in 100 steps,† her life was based around its rules. She was happy then, happier than she’s ever been since, we hadn’t exchanged words, yet, I was just a nametag, and she was just the ringmaster of a group of 30 boys.

The Validity of Cognitive Dissonance Theory Essay examples -- communic

Description of Theory The term dissonance refers to when one cognitive element is inconsistent with another cognitive element according to the lecture notes of Professor Soreno. Cognitive elements can be categorized in four groups called beliefs, attitudes, values, and perceptions of behavior. Beliefs can be defined as a perception that something exists or not. This perception can range from a central or peripheral type of belief. The more central a belief is, the harder it is to change that belief. An attitude describes the positive or negative feelings we have toward people, things, or ideas. Values are beliefs that are so important to a person, that they practically guide a person’s life. There are two types of values, instrumental and terminal. Perceptions of behavior simply refer to the interpretation of actions by another. For example, when someone waves at a person, in America, it is often perceived as a friendly gesture. When two of these cognitive elements are incongruent, it leads to diss onance, which can very in intensity. People often experience dissonance on a daily basis, but because it is so minute, it is not bothersome. The Cognitive Dissonance theory deals with these small occurrences, but for the sake of understanding, extreme examples help to explain the theory in better detail. According to Festinger, all of the cognitive elements held the same value in producing cognitive dissonance, but some scholars have challenged his theory. In the book, The Handbook of Motivation Science, the authors claim that attitude cognitive element holds a heavier value over the other elements by saying it can change the behavior of a person. They quote, â€Å"In experimental tests of the theory, knowledge about recent behavior is usua... ...s communication studies continue, there will be more tests and conclusions on the Cognitive Dissonance theory that will reveal more about human communication. After all, learning how we communicate with each other is how we are able to grow as a society. References Harmon-Jones, E. (2008). Cognitive Dissonance Theory. In J. Shah, W. Gardener, & V. Gardener, Handbook of Motivational Science (pp. 71-83). New York City: The Guilford Press. Helwig-Larson, M., & Collins, B. (1997, April 1). A Social Psychological Perspective on the Role of Knowledge about AIDS in AIDS Prevention. Current Directions in Psychological Science , Vol. 6 (No. 2). Lepper, M. R., & Greene, D. (1975). Turning Play into Work: Effects of Adult Surveillance and Extrinsic Rewards on Children's Intrinsic Motivation. Journal ol Personality and Social Psychology , Vol. 31, 479-486.

Five Years Strategic Plan Essay

Executive summary You are employed by a Swiss subsidiary of a transnational company in the processed food business whose products are sold via retailers and direct to the food service industry in a number of countries. Recently in Swiss subsidiary has been allocated responsibility for the Asia-Pacific Region and you have been assigned the task of spearheading the firm’s push into china and adjacent countries. In the light of opportunities and constraints to be awaited on the chinese market, the evaluation of alternative entry options showed that our best opportunity was on health food products related to the dairy products actual massive trend. We also decided to adress chinese cultural sensitivity issues by entering in long term close relationship with customers instead of being too focused on quick deals and to adapt our networking strategy to chosen entry strategy. We also examined how we should select a strategic partner, should the Chinese government advise us to do so, and how we should be adapting our global marketing processes to the issues raised by national sovereignty in China. Finally, we decided to include as adjacent market either Thailand or Vietnam in order to benefit from the existing trade relationship between them and China, even if countertrade obligations are to be met. INTRODUCTION The overall purpose of this paper is to present our five years strategic plan which objective is to enable our firm to become a major player in the processed food market adressed to retailers and food service industry. Among our very wide range of products, we will examine alternative market entry options in the light of potential opportunity and constraints, then examine the question of the influence of cultural sensitivity on negociations and on introduction of our product to chineses market. The next step of our analysis will be to examine the impact of adhesion of China to WTO on market environment and the consequences of cultural sensitivity to network and relationships. Our next field of investigation will be to examine the threat represented by a potential obligation to enter a strategic alliance with a local player and by our global company culture regarding national sovereignty issues. And we will finally include perspective of developping an adjacent market with eventually compulsory countertrade involved. Section 1 Alternative chinese market entry option for breakfast cereals and cereal bars in the light of potential opportunities and constraints. The recent huge success of dairy products in China, although a majority of the population is lactose intolerant and milk was never part of the traditional chinese food is showing that chinese market has become increasingly open to adopting foreign fooding habits. This is even reinforced by the success encoutered by Mc Donald’s and Starbucks. But one very interesting element of dairy products success is that its main reason and marketing idea is to value its good impact on health. This is what makes us think that the best way to introduce our firm’s product range is to be highly positionned on health benefits to be awaited from consuming our products, their total safety through high level controls. In terms of politics, China is a stable country, which has invested huge efforts into modernisation of its institutions and legal framework in order to enter the World Trade Organisation (WTO) in 2001. Contract enforcement and business matters involving foreigners are to be brought before high courts specifically trained. Intellectual property protection is still a broad problem through counterfaiting and brands like Starbucks are now facing parasite competitors who sell similar products to much lower prices. Chinese market is a huge opportunity but the country still lacks infrastructure and geographic entry has to be limited to main big cities, with a view of extending to the ever increasing number of middle sized cities growing all around the country. The idea of staying in urban areas is linked to two factors: our products are distributed through retailers networks, and food service industry which can only be found in big cities in China at the moment. As we work with retailers and food service industry, indirect market entry strategy through intermediary could prove worthy, at least at the beginning, as long as our products are not known. We could benefit from the intermediary’s network and his expertise on selling foreign products to chinese market. However, using and intermediary is not the prefered solution as it would increase our costs, and as chinese market is very price sensitive due to copycats, keeping good price/value ratio is a key strategic point. With direct market entry methods, we would have more control on market reactions and be able to lower our export costs. Alternative solutions to enter market range from specialised trade fairs (on dairy products, health products, breakfast and snacking products, etc†¦) to a campain of trial gifts to be organised with either yoghurt or milk distributors, or by giving free samples in school, university and working areas cafeterias. We could also reach agreements with already installed foreign companies who would be interested in distributing our products on their shelves. Considering our objective of becoming a major player on processed food within the next 5 years, it would probably be worth it to make a large upfront investment to develop internal expertise in chinese market, in order to maintain our own relationships in the target market, which could be later used in order to introduce other product range on the same market. Therefore, and in the context of a long term investment, prefered market entry would be on health safe products targeting families and young working singles. SWOT Analysis Opportunities: Economic climate : a double digit economic development favourable to high quality trendy foreign food processed products with an attraction to health promising food. Demographic changes turning a rural population into city office working people whose life standards have increased dramatically over the last few years. Market opening through China’s entering WTO system and making legal and administrative environment more import friendly Threats: Competitive activity: other global firms are already on the market and Mc Donald’s, Vuitton and Starbucks experience of the market show that any brand valuation generates its army of copycat making it difficult to keep up with very low prices in a very price sensitive market. Culture: Reluctance to adopt new foreign fooding habits in a very traditional culture Pricing: chinese market is very sensitive to pricing and client segment will have to be chosen carefully and matched to pricing range. Strength: Health food image connected to dairy products Processed food in a booming ever increasing market Product adaptability: Cereals can be flavoured according to Chinese market tastes Networking: Company’s excellent ethic reputation Large target: Product attractive to kids and adult alike Weaknesses Not enough differentiation in products Need high advertising budget to gain trendy attracting image Section 2 How culture might impact on (i) negotiating in china and (ii) introducing your firm’s product into china. The usual tip when you prepare a business trip to China is to carry business cards, bring an interpreter, wear a conservative suit. These advice are easy to follow and have proven usefull, but they are too superficial to get you into the kind of association with chinese you need to be able to negociate agreements and introducing on a long term perspective the firm’s products in China. Graham and Lam (2003) have described the roots of chinese culture which have bound chinese people for 5,000 years and show through chinese business negociation: agrarism which superseedes business(survival depends on group cooperation and harmony, loyalty and obdience to familly hierarchy), confucianist morality (relations of ruler and ruled between husband and wife, parents and children, older and younger, and of equal between friends), being more concerned by means than by end in negociations, the fact that chinese tend to see easily the big picture, and finally that chinese people are very cynical about rule of law and rules in general, only trusting their families and their bank account. The elements that are important in chinese negociation are: have personal connections (friends, relatives and close associates), use an intermediary in order to avoid suspicion and distrust, be formal in order to show social status, pay attention to interpersonal harmony (smile, be nice and friendly), see the big picture and leave the detail to a later stage, be patient in order to get concessions on prices, never embarrass or provoque a lost of composure to a chinese (equivalent to loosing face), value endurant work more than talent. As a result of the above, introducing our products into China will probably require either a very long time necessary to build a trusted network, or the use of an intermediary. It is of first importance to try to establish close contact with significant actors of the retail and food service industry. The pricing of the products will probably also be of concern, as, if too low, it might not have the value effect, but, too high, it might repell consumers more tempted by a local copycat.    Impact of recent access of China to the WTO on other environmental variables which can be encountered when doing business in China and how it might benefit to our ability to establish worthwhile business in China. When China joined WTO in 2001, it made a transition from a centrally planned economy to a market driven economy. The institutional framework for foreign trade was inexistent, the information transparency culture still to be invented, existing judicial and administrative system inadapted. A tremendous amount of work was requested before China could integrate WTO system. China agreed with its major trading partners to open chinese market within 3 to 4 years to foreign companies in various sectors, including telecommunications, distribution and wholesaling, financial services, and banking and insurance. The change in laws included codifying existing administrative practices into written laws and regulations, therefore increasing transparency and predictability, covering around 200. Foreign trade law had to be modifyed. Regulations on international trade of goods and rules of origins were created. Regulations on transnational mergers and acquisitions and franchising were developped according to their new objectives. Anti-dumping, subsidy, countervailing and safeguard measures were prepared, and altogether, the capacity of the Government to provide legal information to the public was strengthened. Under the China’s central planning system, foreign trade was administered with both tariff and nontariff controls, including quantitative controls which WTO rules require to eliminate. To ensure that the WTO’s nondiscrimination principle is met in the judicial process, China issued an order that took effect on 1 March 2002 to elevate the jurisdiction over commercial cases involving foreigners from the primary courts to the higher level of courts, the question of training the judges to the appropriate regulation still being an issue at the moment. (Mitchell:2004). Altogether, when entering WTO system China had the tools to a market economy. These modifications created a foreign investment friendly framework, but the cultural reluctance to rules and the natural reliance to human bonds are still to be watched when doing business in China (Usunier & Lee:2005). It had a great impact on having major competitors entering the chinese market with success and provides market with the stability and rules needed to establish worthwhile invesment. Section 3 Significance of the focus in China on relationship and network on our chosen entry strategy. As, in China, all business is subject to relationship and network, and as we have chosen to invest into a direct market entry strategy, we will have to rely on building our network with key players. Relationship marketing involves creating, maintaining and enhancing strong relationships with customers and other stakeholders. This type of marketing is moving away from focusing on individual transactions and moving towards to focusing on on building value-laden relationships and marketing networks. This type of marketing is long term oriented, very demanding as it is aimed at delivering long term value and satisfaction to customer (Kotler &al:2005) It also involves building relationships at different levels: economics, social, technical and legal resulting in high consumer loyalty. Kotler (2005:476), distinguishes five different relationships that can be formed with customers: basic (sale is made but no follow up on satisfaction) Reactive (salesman encourages customer to come back if any question arises) Accountable (salesperson contacts customer shortly after the sale to check that product meets expectations) Proactive (salesperson or company person phones customer from time to time to suggest other products) Partnership (company works with its customers to discover ways to deliver better value) Considering that we intend to sell our product to a large number of customers with medium profit margin, the adapted relationship level would be â€Å"accountable†. Therefore, salesperson would phone retailer or food service company shortly after the sale to check if product meets expectations. Of course, identifying key customers and being more proactive with them would also enhance efficiency of such relationship marketing. Company would probably take advantage to using other marketing tools as giving special treatment and reward to good customers, or inviting them to special events. Chosen strategy network map and discussion on focal and subsidiary relationship involved. First step is to identify key player in retail networking and food service industry, like main wholesalers to be met at trade fair, mass retailers like supermarkets, trendsetters to be identified on TV or sports like football. Next step is to initiate contact with them with a focus on long term relationship and not on result. These relationship, due to their weight on market and the advantage that can be gained from being referenced with them have to be favoured at a first stage. Then, once this network is established, and in order to continue expansion, identify other distribution channels than wholesalers or mass retailers and initiate subsidiary relationship with them, as smaller restaurants, or hotels. Section 4 Adressing the issues related to rumour that Chinese government might request that we enter into a strategic alliance with a Chinese owned firm: selecting and managing strategic alliance partners in china. As in many asian country there is a rumour that we may have to enter a strategic alliance with a chinese partner in order to be allowed to market processed food in China. As Charles Revson, founder of Revlon cosmetics said once â€Å" I don’t meet competition, I crush it† and this should be remembered when entering a strategic partnership with a chinese partner. In fact, as cultural analysis hereabove showed, chinese only trust their family and their bank account, so, in order to enter a sound alliance, a few criterias must be met. Criterias for selecting strategic partner in China should be: good reputation of loyalty and integrity on the market, but also of product quality for reputation purposes natural feeling and common values, understanding of what our goals are and willingness to collaborate extensive network on our targeted customers, on the areas where we have the greatest growth or the most profitable areas proven synergy opportunity between our two companies instead of competition long term relationship seems possible through mutual cooperation (strategic alliance must be a win-win situation in order to be sustainable on the long term) Impact of the issues of national sovereignty in China on application of our standard marketing approaches in order to enhance global image and additional profits through economy of scale. China is very sensitive on the issue raised by separatist claims by   Taiwanese nationalists, Tibet and Xinjiang separatists. Our standard marketing approaches, designed to enhance global image and enable additional profits through economy of scale, mustn’t be a threat to our main objective which is to become a major player in dairy products in China. Therefore, our standard marketing approaches should be amended in order to avoid any differenciation between the average product sold within China and the ones sold in these three areas. The main market should be priviledged against the particularism of the three separatists areas. No marketing argument that our product would be specifically adressed to the separatists areas should be set forth and it should under no circumstances become a selling argument or even be mentioned, because it would probably cause us to loose main market. Section 5 Criteria to select an adjacent market between Taiwan, Thailand, Myanmar, Vietnam The first criteria to take into account is capacity to use both markets to enhance presence on each other. Creating synergies in a market entry phase might be vital and the level of trade relationship already existing between China and that country is the right measurment. The second one is to choose a market which might be governed by the same cultural trends in order to be able to adopt the same marketing approach to both. A third criteria, maybe more operational, is distance and accessibility (custom tariffs, roads, etc†¦) between both territories. This might enable to base product in one country and ship to the other from thereof. Fourth criteria might be existing trade relations with Switzerland which might make it easier for us to start networking, as the swiss image would already be a commercial advantage. Myanmar being subject to economic sanction from China due to compulsory labor is not a valid adjacent market, though it has entered the asian liberalisation trend and was even acknowledged by the UN Conference on Trade and Development in 2001 as a member that performed ‘well to better’ in the trade liberalisation process under the WTO’s principles It also does not have the right development stage to be interesting and human rights issues might be damaging our image. It has very little commercial bonds with Switzerland. Thailand had rather recent diplomatic relations with China (dating 1975) but shows since then a real will to become a partner of choice of China. Both nations have common roots and share common ancestors. The commercial agreement between the two countries (Sino Thai Free Trade Agreement) only covers fruits and vegetables at the moment but could possibly be extended. Thailand is also member of the WTO. Its main advantage is to already have strong network trade connections with Switzerland (on machinery, watches, etc†¦), where we are based, which could be a decisive advantage for us in terms of network. Taiwan is actually administrated by China which makes it a priviledged area to invest in. It also has a long tradition of trade with China which makes it a good candidate due to the need for trade network to enhance each others, and as a little dragon, it also has the wealth to be interesting, but choosing it would probably not be the best in terms of advantage on chinese market as it does not really add anything different to being only present in China. Also it does not have any specific links with Swiss market. Vietnam has a common frontier with China and is following more or less the same path towards becoming a market economy and entered WTO in january 2007. Though it does not have the same laws, it has a similar development trend, close traditions and the close commercial links with China in all sectors that makes it a suitable adjacent market. It is also a so called little dragon, a booming economy that could be a very profitable market. The trading network between Vietnam and Switzerland is not too developped though Switzerland is present in Vietnam with a swiss embassy in Hanoi. Finally, in order to develop a global brand image in asia, it might be a good choice to choose between Thailand and Vietnam. How to turn the risk of being obliged to countertrade into a profitable trade More than 80 countries nowadays use or require countertrade exchanges. A concensus of experts opinions (Okaroafo, 1989) has put the percentage of the value of world trade volumes related to countertrade at between 20 to 25%. Counter trade usually occurs when countries lack sufficient hard currency. There are five main variants of countertrade which could be of different value to our firm. Entering a barter (exchange of goods or services directly for other goods or services without the use of money as means of purchase or payment) could eventually be interesting if we manage to find good quality bulk products that could be integrated in our products, like fruits or packaging. Using the switch trading practice (in which the country would exchange allowing our importations against an obligation to make a purchase on the domestic market) could also be of interest to us for the same reasons. A buyback (buying machinery necessary to our production in exchange for products) agreement is not a really interesting deal for us as it involves very heavy transportation. Finally, entering an offset agreement (offsetting a hard-currency purchase of an unspecified product) would be a very dangerous operation as we would have to cover currency exchange variations. Proactive strategy to trade profitably with the selected country In order to be ready when the ban on import occurs, we will implement a proactive strategy by identifying products that could be of use in our production process. Then we will start making contacts with producers of these products and gain market knowledge of prices and quality available, identify suitable suppliers that meet our quality requirements and are able to supply us with the adequate quantities. Therefore, when we will be forced to countertrade, we will already have our network in place. Conclusion: As stated in this document, our five year strategic plan on entering Chinese market involves: entering market with health food linked to dairy products mass trendiness with direct marketing tools Always keep in mind the cultural sensitivity of China in order to use it as a competitive advantage instead of a falling trap. Utilise the huge work done by China to be able to keep up with WTO entering necessary standards in terms of transparency and legal framework to our profit in developping our business Invest in developping extended network and long term relationship marketing in order to open the route to introducing our other products on the market later If needed, choose carefully strategic partners Amend global marketing policy in order to avoid sovereignty issues Choose between Thailand and Vietnam as adjacent market, even if countertrade is involved. Reference Table SunfaithChina Ltd,September 2006,†Market Analysis report on China Yoghourt industry†, http://www.mindbranch.com/listing/product/R521-158.html Chen, C, February 2003, â€Å"Got Milk?†, Wall Street Journal http://www.mindfully.org/Food/2003/China-Dairy-Drinks28feb03.htm John L. Graham and N. Mark Lam, 13 october 2003, â€Å"Negotiating in China†, Havard Business School, Excerpted with permission from â€Å"The Chinese Negotiation,† Harvard Business Review, Vol. 81, No. 10, October 2003 Mitchell, A â€Å"Implementing WTO rules: The Importance of Law Reform, Remarks of Arthur M. Mitchell, General Counsel Asian Development Bank, February 2004, apeC Workshop on Best Practices in WTO Capacity Building, http://www.adb.org/Documents/Speeches/2004/sp2004050.asp Vertariu, P., (1992), â€Å"Trends and Developments in International Countertrade,† Business America, (November 2), 2-6. Okaroafo, S., (1989) â€Å"Determinants of LDC Mandated Countertrade,† International Management Review, (Winter), 1624 â€Å"Interview: Thailand aims to further enhance Thailand-China strategic partnership† People’s Daily, Beijing, 28 June 2005, http://www.bilaterals.org/article.php3?id_article=2180 Swiss Federal State Secretariat for Economic Affairs, 2005, â€Å"Report on Swiss Economic Development Cooperation with Vietnam† Kotler,P, and al: (2005), â€Å"Principles of Marketing†, Pearson Education Ltd Usunier, J-C and Lee, J (2005) â€Å"Marketing across cultures†, Pearson Education Ltd Buksbaum, L (1999), â€Å"Choosing strategic partner that really partner†, press release on Inc.com, (http://www.inc.com/articles/1999/11/19511.html)

Wal Mart Annual Report Analysis

EXECUTIVE OFFICERS Eduardo Castro-Wright Vice Chairman, Wal-Mart Stores, Inc. M. Susan Chambers Executive Vice President, Global People Brian C. Cornell Executive Vice President, President and Chief Executive Officer, Sam’s Club 2 010 Financial Report 15 Five-Year Financial Summary 16 Management’s Discussion and Analysis of Financial Condition and Results of Operations 30 Consolidated Statements of Income 31 Consolidated Balance Sheets 32 Consolidated Statements of Shareholders’ Equity 33 Consolidated Statements of Cash Flows 34 Notes to Consolidated Financial Statements 52 Report of Independent Registered Public Accounting Firm 3 Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting Thomas M. Schoewe Executive Vice President and Chief Financial Officer 54 Management’s Report to Our Shareholders 55 Fiscal 2010 End-of-Year Store Count H. Lee Scott, Jr. Chairman of the Executive Committee of the Board of Directo rs 56 Corporate and Stock Information Leslie A. Dach Executive Vice President, Corporate Affairs and Government Relations Michael T. Duke President and Chief Executive Officer Rollin L. Ford Executive Vice President, Chief Information Officer Thomas D. Hyde Executive Vice President, Legal, Ethics, nd Corporate Secretary C. Douglas McMillon Executive Vice President, President and Chief Executive Officer, Walmart International S. Robson Walton Chairman of the Board of Directors Steven P. Whaley Senior Vice President and Controller 14 Walmart 2010 Annual Report 107077_L01_FIN_02. indd 14 4/6/10 12:10:45 AM 2010 FINANCIAL REVIEW Five-Year Financial Summary (Amounts in millions except per share and unit count data) As of and for the Fiscal Years Ended January 31, 2010 2009 2008 2007 2006 (1) Operating Results Net sales Net sales increase Comparable store sales in the United States (2) Walmart U. S.Sam’s Club Gross pro? t margin Operating, selling, general and administrative expens es, as a percentage of net sales Operating income Income from continuing operations attributable to Walmart Per share of common stock: Income from continuing operations attributable to Walmart, diluted Dividends $405,046 1. 0% -0. 8% -0. 7% -1. 4% 24. 8% $401,087 7. 3% 3. 5% 3. 2% 4. 9% 24. 2% $373,821 8. 4% 1. 6% 1. 0% 4. 9% 24. 0% $344,759 11. 6% 2. 0% 1. 9% 2. 5% 23. 4% $308,945 9. 8% 3. 4% 3. 0% 5. 0% 23. 1% 19. 7% $ 23,950 14,414 19. 3% $ 22,798 13,254 19. 0% $ 21,952 12,863 18. 5% $ 20,497 12,189 18. 0% $ 18,693 1,386 3. 72 1. 09 $3. 35 0. 95 $3. 16 0. 88 $2. 92 0. 67 $2. 72 0. 60 $ 33,160 102,307 170,706 36,401 70,749 $ 34,511 95,653 163,429 34,549 65,285 $ 35,159 96,867 163,514 33,402 64,608 $ 33,667 88,287 151,587 30,735 61,573 $ 31,910 77,863 138,793 30,096 53,171 Unit Counts Walmart U. S. Segment International Segment Sam’s Club Segment 3,708 4,112 596 3,656 3,605 602 3,550 3,098 591 3,443 2,734 579 3,289 2,158 567 Total units 8,416 7,863 7,239 6,756 6,014 Financia l Position Inventories Property, equipment and capital lease assets, net Total assets Long-term debt, including obligations under capital leasesTotal Walmart shareholders’ equity $ (1) In connection with the company’s ? nance transformation project, we reviewed and adjusted the classi? cation of certain revenue and expense items within our Consolidated Statements of Income for ? nancial reporting purposes. Although the reclassi? cations impacted net sales, gross margin and operating, selling, general and administrative expenses, they did not impact operating income or income from continuing operations attributable to Walmart. The changes were effective February 1, 2009 and have been re? ected for ? scal years 2010, 2009 and 2008. 2) Comparable store and club sales include fuel. For ? scal 2006, we considered comparable sales to be sales at stores and clubs that were open as of February 1st of the prior ? scal year and which had not been converted, expanded or relocated since that date. Fiscal 2008 and ? scal 2007 comparable sales includes all stores and clubs that have been open for at least the previous 12 months. Additionally, for those ? scal years, stores and clubs that are relocated, expanded or converted are excluded from comparable sales for the ? rst 12 months following the relocation, expansion or conversion.Fiscal 2010 and 2009 comparable sales include sales from stores and clubs open for the previous 12 months, including remodels, relocations and expansions. Fiscal 2008 and prior ? scal years’ comparable sales do not re? ect reclassi? cations effective February 1, 2009, as noted above. Walmart 2010 Annual Report 15 107077_L01_FIN_02. indd 15 4/6/10 12:10:45 AM Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview Wal-Mart Stores, Inc. (â€Å"Walmart,† the â€Å"company† or â€Å"we†) operates retail stores in various formats around the world and is committed to saving people money so they can live better.We earn the trust of our customers every day by providing a broad assortment of quality merchandise and services at every day low prices (â€Å"EDLP†), while fostering a culture that rewards and embraces mutual respect, integrity and diversity. EDLP is our pricing philosophy under which we price items at a low price every day so that our customers trust that our prices will not change under frequent promotional activity. Our focus for Sam’s Club is to provide exceptional value on brand name merchandise at â€Å"members only† prices for both business and personal use.Internationally, we operate with similar philosophies. Our ? scal year ends on January 31 for our U. S. , Canada and Puerto Rico operations. Our ? scal year ends on December 31 for all other operations. We intend for this discussion to provide the reader with information that will assist in understanding our ? nancial statements, the changes in certain key items in those ? nancial statements from year to year, and the primary factors that accounted for those changes, as well as how certain accounting principles affect our ? nancial statements.We also discuss certain performance metrics that management uses to assess our performance. The discussion also provides information about the ? nancial results of the various segments of our business to provide a better understanding of how those segments and their results affect the ? nancial condition and results of operations of the company as a whole. This discussion should be read in conjunction with our Consolidated Financial Statements as of January 31, 2010, and the year then ended, and accompanying notes. Our operations comprise three business segments: Walmart U.S. , International and Sam’s Club. The Walmart U. S. segment includes the company’s mass merchant concept in the United States, operating under the â€Å"Walmart† or â€Å"Wal-Mart† brand, as well a s walmart. com. The International segment consists of the company’s operations outside of the 50 United States. The Sam’s Club segment includes the warehouse membership clubs in the United States, as well as samsclub. com. Sales By Segment Net sales in ? scal 2010 were a record $405. 0 billion, up 1. 0% from ? scal 2009. Sam’s Club 11. 5% International 24. 7%Throughout this Management’s Discussion and Analysis of Financial Condition and Results of Operations, we discuss segment operating income and comparable store sales. The company measures the results of its segments using, among other measures, each segment’s operating income which includes certain corporate overhead allocations. From time to time, we revise the measurement of each segment’s operating income, including any corporate overhead allocations, as dictated by the information regularly reviewed by our chief operating decision maker.When we do so, the segment operating income for each segment affected by the revisions is restated for all periods presented to maintain comparability. In connection with the company’s ? nance transformation project, we reviewed and adjusted the classi? cation of certain revenue and expense items within our Consolidated Statements of Income for ? nancial reporting purposes. The reclassi? cations did not impact operating income or consolidated net income attributable to Walmart. The changes were effective February 1, 2009 and have been re? ected in all periods presented.Comparable store sales is a measure which indicates the performance of our existing U. S. stores and clubs by measuring the growth in sales for such stores for a particular period over the corresponding period in the prior year. In ? scal 2008, our method of calculating comparable store sales included all stores and clubs that were open for at least the previous 12 months. Additionally, stores and clubs that were relocated, expanded or converted were exclud ed from comparable store sales for the ? rst 12 months following the relocation, expansion or conversion. During ? scal year 2008, the company reviewed its de? ition of comparable store sales for consistency with other retailers. As a result of that review, since February 1, 2008, Walmart’s de? nition of comparable store sales includes sales from stores and clubs open for the previous 12 months, including remodels, relocations and expansions. Changes in format continue to be excluded from comparable store sales when the conversion is accompanied by a relocation or expansion that results in a change in square footage of more than ? ve percent. Since the impact of this revision is inconsequential, the company will not restate comparable store sales results for previously reported years.Comparable store sales are also referred to as â€Å"same-store† sales by others within the retail industry. The method of calculating comparable store sales varies across the retail indus try. As a result, our calculation of comparable store sales is not necessarily comparable to similarly titled measures reported by other companies. In discussions of our consolidated results and the operating results of our International segment, we sometimes refer to the impact of changes in currency exchange rates. When we refer to changes in currency exchange rates or currency exchange rate ? ctuations, we are referring to the differences between the currency exchange rates we use to convert the International segment’s operating results from local currencies into U. S. dollars for reporting purposes. The impacts of currency exchange rate ? uctuations are typically calculated as the difference between current period activity translated using the current period’s currency exchange rates and the comparable prior year period’s currency exchange rates, respectively. We use this method for all countries where the functional currency is not U. S. denominated. Walmar t U. S. 63. 8% 16 Walmart 2010 Annual Report 107077_L01_FIN. ndd 16 4/6/10 8:25:50 PM Management’s Discussion and Analysis of Financial Condition and Results of Operations The Retail Industry We operate in the highly competitive retail industry in both the United States and the countries we serve internationally. We face strong sales competition from other discount, department, drug, variety and specialty stores, warehouse clubs, and supermarkets, many of which are national, regional or international chains, as well as internet-based retailers and catalog businesses. We compete with a number of companies for prime retail site locations, as well as in attracting and retaining quality employees whom we call â€Å"associates†). We, along with other retail companies, are in? uenced by a number of factors including, but not limited to: general economic conditions, cost of goods, consumer disposable income, consumer debt levels and buying patterns, consumer credit availabili ty, interest rates, customer preferences, unemployment, labor costs, in? ation, de? ation, currency exchange ? uctuations, fuel and energy prices, weather patterns, climate change, catastrophic events, competitive pressures and insurance costs. Further information on risks to our company can be located in â€Å"Item 1A.Risk Factors† in our Annual Report on Form 10-K for the ? scal year ended January 31, 2010. Company Performance Metrics The company’s performance metrics emphasize three priorities for improving shareholder value: growth, leverage and returns. The company’s priority of growth focuses on sales growth; the priority of leverage encompasses the company’s metric to increase our operating income at a faster rate than the growth in net sales by growing our operating, selling, general and administrative expenses (â€Å"operating expenses†) at a slower rate than the growth of our net sales; and the priority of returns focuses on how ef? ientl y the company employs our assets through return on investment (â€Å"ROI†) and how effectively the company manages working capital through free cash ? ow. Growth Net Sales Fiscal Years Ended January 31, (Dollar amounts in millions) 2009 2010 Percent increase Net sales Percent of total 2008 Percent increase Net sales Percent of total Net sales Percent of total Walmart U. S. International Sam’s Club $258,229 100,107 46,710 63. 8% 24. 7% 11. 5% 1. 1% 1. 3% -0. 4% $255,348 98,840 46,899 63. 7% 24. 6% 11. 7% 6. 9% 9. 1% 5. 8% $238,915 90,570 44,336 63. 9% 24. 2% 11. 9% Net Sales $405,046 00. 0% 1. 0% $401,087 100. 0% 7. 3% $373,821 100. 0% O ur net sales increased by 1. 0% and 7. 3% in ? scal 2010 and 2009, respectively, when compared to the previous ? scal year. Net sales in ? scal 2010 increased due to increased customer traf? c, continued global expansion activities and the acquisition of our Chilean subsidiary, Distribucion y Servicio (â€Å"D&S†) in January 2009 , offset primarily by a $9. 8 billion unfavorable currency exchange rate impact in our International segment and price de? ation in certain merchandise categories in our Walmart U. S. segment. Net sales in ? cal 2009 increased due to our global expansion activities and comparable store sales increases, offset by a $2. 3 billion unfavorable currency exchange rate impact. Despite the unfavorable impact of currency exchanges rates, the International segment’s net sales as a percentage of total company net sales increased in ? scal 2010 and 2009, respectively. Volatility in currency exchange rates may continue to impact the International segment’s net sales in the future. Comparable Store Sales Comparable store sales is a measure which indicates the performance of our existing U. S. tores by measuring the growth in sales for such stores for a particular period over the corresponding period in the prior year. Comparable store sales in the United States decreased 0. 8% in ? scal 2010 and increased 3. 5% in ? scal 2009. Although customer traf? c increased in ? scal 2010, comparable store sales in the United States were lower than ? scal 2009 due to de? ation in certain merchandise categories and lower fuel prices. Comparable store sales in the United States in ? scal 2009 were higher than ? scal 2008 due to an increase in customer traf? c, as well as an increase in average transaction size per customer.As we continue to add new stores in the United States, we do so with an understanding that additional stores may take sales away from existing units. We estimate the negative impact on comparable store sales as a result of opening new stores was approximately 0. 6% in ? scal 2010 and 1. 1% in ? scal 2009. With our planned slower new store growth, we expect the impact of new stores on comparable store sales to stabilize over time. Fiscal Years Ended January 31, 2010 2009 2008 Walmart U. S. Sam’s Club (1) -0. 7% -1. 4% 3. 2% 4. 9% 1. 0% 4. 9% Total U . S. -0. 8% 3. 5% 1. 6% (1) Sam’s Club comparable club sales include fuel.Fuel sales had a negative impact of 2. 1 percentage points in ? scal year 2010, and positive impact of 1. 2 and 0. 7 percentage points in ? scal years 2009 and 2008, respectively, on comparable club sales. Walmart 2010 Annual Report 17 107077_L01_FIN_02. indd 17 4/6/10 12:10:46 AM Management’s Discussion and Analysis of Financial Condition and Results of Operations Leverage Fiscal Years Ended January 31, (Dollar amounts in millions) 2009 2010 Operating income Percent of total Percent increase Operating income 2008 Percent of total Percent increase Operating income Percent of total Walmart U.S. International Sam’s Club Other $19,522 5,033 1,512 (2,117) 81. 5% 21. 0% 6. 3% -8. 8% 5. 2% 1. 9% -8. 1% -9. 9% $18,562 4,940 1,646 (2,350) 81. 4% 21. 7% 7. 2% -10. 3% 6. 8% 4. 6% -0. 1% 30. 3% $17,383 4,725 1,648 (1,804) 79. 2% 21. 5% 7. 5% -8. 2% Total operating income $23,950 100. 0% 5. 1% $22,798 100. 0% 3. 9% $21,952 100. 0% We believe growing operating income at a faster rate than net sales growth is a meaningful measure because it indicates how effectively we manage costs and leverage operating expenses. Our objective is to grow operating expenses at a slower rate than net sales. nd ending total assets of continuing operations plus accumulated depreciation and amortization less accounts payable and accrued liabilities for that period, plus a rent factor equal to the rent for the ? scal year multiplied by a factor of eight. Operating Expenses In ? scal 2010, operating expenses increased 2. 7% when compared to ? scal 2009, while net sales increased 1. 0% over the same period. Operating expenses grew at a faster rate than net sales due to higher health bene? t costs, restructuring charges and higher advertising expenses. In ? scal 2009, operating expenses increased 9. % compared to ? scal 2008 while net sales increased 7. 3% over the same period. Operating expenses grew at a faster rate than net sales in ? scal 2009 primarily due to higher utility costs, legal matters, higher health bene? t costs and increased corporate expenses. ROI is considered a non-GAAP ? nancial measure under the SEC’s rules. We consider return on assets (â€Å"ROA†) to be the ? nancial measure computed in accordance with GAAP that is the most directly comparable ? nancial measure to ROI as we calculate that ? nancial measure. ROI differs from ROA (which is income from continuing operations for the ? cal year divided by average total assets of continuing operations for the period) because ROI: adjusts operating income to exclude certain expense items and adds interest income; adjusts total assets from continuing operations for the impact of accumulated depreciation and amortization, accounts payable and accrued liabilities; and incorporates a factor of rent to arrive at total invested capital. Operating Income For ? scal 2010, we met our objective of growing operat ing income at a faster rate than net sales. Our operating income increased by 5. 1% when compared to ? cal 2009, while net sales increased by 1. 0% over the same period. Our Walmart U. S. and International segments met this objective. Our Sam’s Club segment fell short of this objective primarily due to a $174 million charge to restructure its operations, including the closure of 10 clubs. For ? scal 2009, we did not meet our objective because our operating income increased by 3. 9% when compared to ? scal 2008, while net sales increased by 7. 3% over the same period. The Walmart U. S. and Sam’s Club segments fell short of this objective due to increases in operating expenses.The International segment fell short of this objective due to accruals for certain legal matters and ? uctuations in currency exchange rates. Although ROI is a standard ? nancial metric, numerous methods exist for calculating a company’s ROI. As a result, the method used by management to cal culate ROI may differ from the methods other companies use to calculate their ROI. We urge you to understand the methods used by another company to calculate its ROI before comparing our ROI to that of such other company. Wal-Mart Stores, Inc. Operating Income (Amounts in millions) 24,000 Returns Return on Investment Management believes return on investment is a meaningful metric to share with investors because it helps investors assess how effectively Walmart is employing its assets. Trends in ROI can ? uctuate over time as management balances long-term potential strategic initiatives with any possible short-term impacts. ROI was 19. 3 percent for both ? scal years ended January 31, 2010 and 2009. $18,000 Wal-Mart Stores, Inc. operating income increased 5. 1% in ? scal 2010, driven by a 5. 2% increase in Walmart U. S. $12,000 $ 6,000 We de? e ROI as adjusted operating income (operating income plus interest income, depreciation and amortization and rent expense) for the ? scal year divided by average invested capital during that period. We consider average invested capital to be the average of our beginning 0 08 09 10 Fiscal Years 18 Walmart 2010 Annual Report 107077_L01_FIN. indd 18 4/6/10 10:19:20 PM Management’s Discussion and Analysis of Financial Condition and Results of Operations The calculation of ROI along with a reconciliation to the calculation of ROA, the most comparable GAAP ? nancial measurement, is as follows: For the Years Ended January 31, Dollar amounts in millions) 2010 2009 Numerator Operating income (1) + Interest income (1) + Depreciation and amortization (1) + Rent (1) $ 23,950 181 7,157 1,808 $ 22,798 284 6,739 1,751 = Adjusted operating income $ 33,096 $ 31,572 Denominator Average total assets of continuing operations (2) + Average accumulated depreciation and amortization (2) – Average accounts payable (2) – Average accrued liabilities (2) + Rent x 8 $166,900 38,359 29,650 18,423 14,464 $162,891 33,317 29,597 16,9 19 14,008 = Average invested capital $171,650 $163,700 CALCULATION OF RETURN ON INVESTMENT Return on investment (ROI) 19. 3% 19. 3%CALCULATION OF RETURN ON ASSETS Numerator Income from continuing operations (1) $ 14,927 $ 13,753 Denominator Average total assets of continuing operations (2) $166,900 $162,891 Return on assets (ROA) 8. 9% 8. 4% As of January 31, 2010 Certain Balance Sheet Data (1) Total assets of continuing operations Accumulated depreciation and amortization Accounts payable Accrued liabilities 2009 2008 $170,566 41,210 30,451 18,734 $163,234 35,508 28,849 18,112 $162,547 31,125 30,344 15,725 (1) Based on continuing operations only and therefore excludes the impact of closing 23 stores and the divesture of other properties of The Seiyu, Ltd. now Walmart Japan) pursuant to a restructuring program adopted during the third quarter of ? scal 2009. All of these activities have been disclosed as discontinued operations. Total assets as of January 31, 2010, 2009 and 2008 in the table above exclude assets of discontinued operations that are re? ected in the Consolidated Balance Sheets of $140 million, $195 million and $967 million, respectively. (2) The average is based on the addition of the account balance at the end of the current period to the account balance at the end of the prior period and dividing by 2. Walmart 2010 Annual Report 19 107077_L01_FIN_02. indd 19 /6/10 12:10:47 AM Management’s Discussion and Analysis of Financial Condition and Results of Operations Free Cash Flow We de? ne free cash ? ow as net cash provided by operating activities of continuing operations in a period minus payments for property and equipment made in that period. We generated positive free cash ? ow of $14. 1 billion, $11. 6 billion and $5. 7 billion for the years ended January 31, 2010, 2009 and 2008, respectively. The increase in our free cash ? ow is primarily the result of improved operating results and inventory management. The following table sets fort h a reconciliation of free cash ? w, a nonGAAP ? nancial measure, to net cash provided by operating activities of continuing operations, a GAAP measure, which we believe to be the GAAP ? nancial measure most directly comparable to free cash ? ow, as well as information regarding net cash used in investing activities and net cash used in ? nancing activities. Fiscal Years Ended January 31, (Amounts in millions) Free cash ? ow is considered a non-GAAP ? nancial measure under the SEC’s rules. Management believes, however, that free cash ? ow, which measures our ability to generate additional cash from our business operations, is an important ? ancial measure for use in evaluating the company’s ? nancial performance. Free cash ? ow should be considered in addition to, rather than as a substitute for, income from continuing operations as a measure of our performance and net cash provided by operating activities as a measure of our liquidity. Additionally, our de? nition of free cash ? ow is limited, in that it does not represent residual cash ? ows available for discretionary expenditures due to the fact that the measure does not deduct the payments required for debt service and other contractual obligations or payments made for business acquisitions.Therefore, we believe it is important to view free cash ? ow as a measure that provides supplemental information to our entire statement of cash ? ows. Although other companies report their free cash ? ow, numerous methods may exist for calculating a company’s free cash ? ow. As a result, the method used by our management to calculate free cash ? ow may differ from the methods other companies use to calculate their free cash ? ow. We urge you to understand the methods used by another company to calculate its free cash ? ow before comparing our free cash ? ow to that of such other company.We generated positive free cash flow of $14. 1 billion, $11. 6 billion and $5. 7 billion for the years ended Jan uary 31, 2010, 2009 and 2008, respectively. The increase in our free cash flow is primarily the result of improved operating results and inventory management. Net cash provided by operating activities Payments for property and equipment Free cash ? ow Net cash used in investing activities Net cash used in ?nancing activities 2010 $26,249 (12,184) $ 14,065 2009 2008 $ 23,147 $ 20,642 (11,499) (14,937) $ 11,648 $ 5,705 $(11,620) $(10,742) $(15,670) $(14,191) $ (9,918) $ (7,422)Results of Operations The following discussion of our Results of Operations is based on our continuing operations and excludes any results or discussion of our discontinued operations. Unusual or infrequent items that impacted our income from continuing operations during the ? scal years ended 2010, 2009 and 2008 were as follows: †¢ In ? scal 2010, the company announced several organizational changes, including the closure of 10 Sam’s Clubs, designed to strengthen and streamline our operations. As a result, we recorded $260 million in pre-tax restructuring charges. †¢ In ? cal 2010, we recorded $372 million in net tax bene? ts primarily from the repatriation of certain non-U. S. earnings that increased U. S. foreign tax credits. †¢ In ? scal 2009, the company settled 63 wage-and-hour class action lawsuits. As a result of the settlement, the company recorded a pre-tax charge of approximately $382 million during the fourth quarter of ? scal 2009. †¢ In ? scal 2008, we reduced our accrued liabilities for our general liability and worker’s compensation claims. As a result, operating expenses were reduced by a pre-tax amount of $298 million. 20 Walmart 2010 Annual Report 07077_L01_FIN. indd 20 4/7/10 12:14:15 AM Management’s Discussion and Analysis of Financial Condition and Results of Operations Consolidated Results of Operations Fiscal Year Net Sales (1) % Change from Prior Fiscal Year 2010 2009 2008 $405,046 401,087 373,821 1. 0% 7. 3% 8. 4% Operating Income (1) Operating Income as a Percentage of Net Sales Comp Sales Unit Counts Square Footage (2) $23,950 22,798 21,952 5. 9% 5. 7% 5. 9% -0. 8% 3. 5% 1. 6% 8,416 7,863 7,239 952,204 918,008 867,448 (1) Amounts in millions (2) Amounts in thousands Our consolidated net sales increased by 1. 0% and 7. 3% in ? cal 2010 and 2009, respectively, when compared to the previous ? scal year. Net sales in ? scal 2010 increased due to increased customer traf? c, continued global expansion activities and the acquisition of D&S in January 2009, offset primarily by a $9. 8 billion unfavorable currency exchange rate impact in our International segment and price de? ation in certain merchandise categories in our Walmart U. S. segment. Net sales in ? scal 2009 increased due to our global store expansion activities, comparable store sales increases, offset by a $2. 3 billion unfavorable currency exchange rate impact.Volatility in currency exchange rates may continue to impact the International segme nt’s net sales in the future. Our gross pro? t, as a percentage of net sales, (our â€Å"gross pro? t margin†) was 24. 8%, 24. 2% and 24. 0% in ? scal 2010, 2009 and 2008, respectively. Our Walmart U. S. and International segment sales yield higher gross pro? t margins than our Sam’s Club segment. In ? scal 2010, gross pro? t margin increased primarily due to the continued focus on enhanced merchandising strategies and better inventory management in our Walmart U. S. and Sam’s Club segments. The gross pro? margin increase in ? scal 2009 compared to ? scal 2008 was primarily due to lower inventory shrinkage and less markdown activity as a result of more effective merchandising in the Walmart U. S. segment. Operating expenses, as a percentage of net sales, were 19. 7%, 19. 3% and 19. 0% for ? scal 2010, 2009 and 2008, respectively. In ? scal 2010, operating expenses increased primarily due to higher health bene? t costs, a pre-tax charge of $260 million rel ating to the restructuring of U. S. operations and higher advertising expenses. In ? scal 2009, operating expenses increased rimarily due to higher utility costs, a pre-tax charge of approximately $382 million resulting from the settlement of 63 wage-and-hour class action lawsuits, higher health bene? t costs and increased corporate expenses compared to ? scal 2008. Our effective income tax rate was 32. 4% for ? scal year 2010 and 34. 2% for ? scal years 2009 and 2008. The ? scal 2010 effective tax rate decreased compared to ? scal 2009 due to $372 million in net tax bene? ts that primarily resulted from the repatriation of certain non-U. S. earnings that increased our utilization of U. S. foreign tax credits.As a result of the factors discussed above, we reported $14. 9 billion, $13. 8 billion and $13. 3 billion of income from continuing operations for the ? scal years ended January 31, 2010, 2009 and 2008, respectively. Walmart U. S. Segment Fiscal Year Net Sales (1) % Change from Prior Fiscal Year 2010 2009 2008 $258,229 255,348 238,915 1. 1% 6. 9% 5. 6% Operating Income (1) Operating Income as a Percentage of Net Sales Comp Sales Unit Counts Square Footage (2) $19,522 18,562 17,383 7. 6% 7. 3% 7. 3% -0. 7% 3. 2% 1. 0% 3,708 3,656 3,550 602,908 589,299 566,629 (1) Amounts in millions (2) Amounts in thousands The segment net sales growth in ? cal 2010 resulted from an increase in customer traf? c and strength in our grocery and health and wellness categories, as well as our continued expansion activities. In ? scal 2009, the segment net sales growth resulted from a comparable store sales increase of 3. 2%, in addition to our expansion activities. Strength in the grocery, health and wellness and entertainment categories, as well as strong seasonal sales throughout the year also contributed to the ? scal 2009 net sales increase. The segment net sales growth in fiscal 2010 resulted from an increase in customer traffic and strength in our grocery and health and ellness categories, as well as our continued expansion activities. Walmart 2010 Annual Report 21 107077_L01_FIN. indd 107077_L01_FIN. indd 21 4/6/10 8:25:51 PM Management’s Discussion and Analysis of Financial Condition and Results of Operations Comparable store sales were lower in ? scal 2010, despite increased customer traf? c, due to a decrease in average transaction size per customer driven by price de? ation in certain merchandise categories. Comparable store sales were higher in ? scal 2009 due to an increase in customer traf? c, as well as an increase in average transaction size per customer. In ? scal 2010, gross pro? margin increased 0. 7 percentage points compared to the prior year due to more effective merchandising, better inventory management and lower inventory shrinkage. In ? scal 2009, gross pro? t margin increased 0. 4 percentage points compared to the prior year primarily due to decreased markdown activity and lower inventory shrinkage. The improvements in b oth years were attributable to merchandising initiatives that have improved space allocation, enhanced our price leadership and increased supply chain ef? ciencies. Segment operating expenses, as a percentage of segment net sales, increased by 0. 4 percentage points in ? cal 2010 compared to ? scal 2009 due to lower segment net sales increases compared to the prior year, higher health bene? t costs, higher advertising expenses and a pre-tax charge of $73 million relating to the restructuring of Walmart U. S. operations. Segment operating expenses, as a percentage of segment net sales, increased 0. 4 percentage points in ? scal 2009 compared to the prior year due to hurricane-related expenses, higher bonus payments for store associates, higher utility costs and an increase in health bene? t costs. International Segment Net Sales (1) 2010 2009 2008 Operating Income (1) Operating Income a s a Percentage f Net Sales Unit Counts Square Footage (2 ) $100,107 98,840 90,570 Fiscal Year % Ch ange from Prior Fiscal Year 1. 3% 9. 1% 17. 8% $5,033 4,940 4,725 5. 0% 5. 0% 5. 2% 4,112 3,605 3,098 269,894 248,803 222,583 (1) Amounts in millions (2) Amounts in thousands At January 31, 2010, our International segment was comprised of our wholly-owned subsidiaries operating in Argentina, Brazil, Canada, Japan, Puerto Rico and the United Kingdom, our majority-owned subsidiaries operating in ? ve countries in Central America, and in Chile and Mexico, our joint ventures in India and China and our other controlled subsidiaries in China.The ? scal 2010 increase in the International segment’s net sales primarily resulted from our expansion activities and the inclusion of the results of D&S, acquired in January 2009, offset by the unfavorable impact of changes in currency exchange rates of $9. 8 billion. For additional information regarding our acquisitions, refer to Note 9 to the Consolidated Financial Statements. The ? scal 2009 increase in the International segment’s n et sales was primarily due to net sales growth from existing units and our international expansion program, offset by the unfavorable impact of changes in currency exchange rates of $2. billion. The fiscal 2010 increase in the International segment’s net sales primarily resulted from our expansion activities and the inclusion of the results of D&S, acquired in January 2009, offset by the unfavorable impact of changes in currency exchange rates of $9. 8 billion. In ? scal 2010, the International segment’s gross pro? t margin increased 0. 2 percentage points compared to the prior year. The increase was primarily driven by currency exchange rate ? uctuations and the inclusion of D&S. In ? scal 2009, the International segment’s gross pro? t margin decreased 0. percentage points compared to the prior year. The decrease was primarily driven by growth in lower margin fuel sales in the United Kingdom and the transition to EDLP as a strategy in Japan. Segment operating e xpenses, as a percentage of segment net sales, increased 0. 3 percentage points in ? scal 2010 compared to the prior year primarily as a result of the inclusion of D&S, acquired in January 2009. Segment operating expenses, as a percentage of segment net sales, in ? scal 2009 were consistent with ? scal 2008. In ? scal 2010, currency exchange rate changes unfavorably impacted operating income by $540 million.In ? scal 2009, currency exchange rate changes unfavorably impacted operating income by $266 million. Volatility in currency exchange rates may continue to impact the International segment’s operating results in the future. 22 Walmart 2010 Annual Report 107077_L01_FIN. indd 107077_L01_FIN. indd 22 4/6/10 8:25:51 PM Management’s Discussion and Analysis of Financial Condition and Results of Operations Sam’s Club Segment Fiscal Year Net Sales (1) % Change from Prior Fiscal Year Operating Income (1) Operating Income a s a Percentage of Net Sales Comp Sales Unit C ounts Square Footage (2 ) $46,710 46,899 44,336 0. 4% 5. 8% 6. 6% $1,512 1,646 1,648 3. 2% 3. 5% 3. 7% -1. 4% 4. 9% 4. 9% 596 602 591 79,401 79,906 78,236 2010 2009 2008 (1) Amounts in millions (2) Amounts in thousands The decrease in net sales for the Sam’s Club segment in ? scal 2010 primarily resulted from lower fuel prices compared to the previous ? scal year. In ? scal 2009, the segment net sales growth resulted from a comparable club sales increase, including fuel, of 4. 9% and continued club expansion activities. Membership and other income, as a percentage of segment net sales, decreased slightly for ? scal 2010 when compared to ? scal 2009.Membership and other income, as a percentage of segment net sales, decreased slightly for ? scal 2009 when compared to ? scal 2008. Liquidity and Capital Resources Comparable club sales decreased during ? scal 2010 due to the negative impact of 2. 1 percentage points from lower fuel prices when compared to the previous ? scal year, partially offset by sales increases in fresh food, consumables and certain health and wellness categories. In ? scal 2009, comparable club sales increased due to growth in food, pharmacy, electronics and certain consumables categories, as well as an increase in both member traf? and average transaction size per member. Fuel sales had a positive impact of 1. 2 percentage points in ? scal 2009 on comparable club sales. Gross pro? t margin increased 0. 6 percentage points during ? scal 2010 compared to the prior year due to continued strength in sales of consumable, fresh food and other food-related categories. Gross pro? t margin increased 0. 1 percentage points during ? scal 2009 compared to the prior year due to strong sales in fresh food and other food-related categories, consumable categories and the positive impact of a higher fuel gross pro? t rate.Segment operating expenses, as a percentage of segment net sales, increased 0. 8 percentage points in ? scal 2010 compared to the p rior year due primarily to a pre-tax charge of $174 million related to the restructuring of Sam’s Club operations, including the closure of 10 clubs. Segment operating expenses, as a percentage of segment net sales, increased 0. 2 percentage points in ? scal 2009 compared to the prior year. In ? scal 2009, operating expense increases were impacted by higher utility and health bene? t costs and hurricane-related expenses. Cash flows provided by operating activities upply us with a significant source of liquidity. We use these cash flows, supplemented with long-term debt and short-term borrowings, to fund our operations and global expansion activities. Generally, some or all of the remaining free cash flow funds the dividends on our common stock and share repurchases. Cash ? ows provided by operating activities supply us with a signi? cant source of liquidity. We use these cash ? ows, supplemented with long-term debt and short-term borrowings, to fund our operations and global expansion activities. Generally, some or all of the remaining free cash ? w funds the dividends on our common stock and share repurchases. Fiscal Years Ended January 31, (Amounts in millions) 2010 Net cash provided by operating activities Payments for property and equipment Free cash ? ow 2009 2008 $ 26,249 $ 23,147 $ 20,642 (12,184) (11,499) (14,937) $ 14,065 $ 11,648 $ 5,705 Net cash used in investing activities Net cash used in ?nancing activities $(11,620) $(10,742) $(15,670) $(14,191) $ (9,918) $ (7,422) Cash ? ow provided by operating activities was $26. 2 billion, $23. 1 billion and $20. 6 billion for the years ended January 31, 2010, 2009 and 2008, respectively. The increases in cash ? ws provided by operating activities for each ? scal year were primarily attributable to an increase in income from continuing operations and improved working capital management. Working Capital Current liabilities exceeded current assets at January 31, 2010, by $7. 2 billion, an increase of $7 89 million from January 31, 2009. Our ratio of current assets to current liabilities was 0. 9 at January 31, 2010 and 2009. We generally have a working capital de? cit due to our ef? cient use of cash in funding operations and in providing returns to shareholders in the form of stock repurchases and payment of dividends.Walmart 2010 Annual Report 23 107077_L01_FIN. indd 107077_L01_FIN. indd 23 4/7/10 1:06:36 AM Management’s Discussion and Analysis of Financial Condition and Results of Operations Capital Resources During ? scal 2010, we issued $5. 5 billion of long-term debt. The net proceeds from the issuance of such long-term debt were used for general corporate purposes. During ? scal 2009, we issued $6. 6 billion of long-term debt. Those net proceeds were used to repay outstanding commercial paper indebtedness and for other general corporate purposes. Management believes that cash ? ws from continuing operations and proceeds from the issuance of short-term borrowings will be suf? cient to ? nance seasonal buildups in merchandise inventories and meet other cash requirements. If our operating cash ? ows are not suf? cient to pay dividends and to fund our capital expenditures, we anticipate funding any shortfall in these expenditures with a combination of short-term borrowings and long-term debt. We plan to re? nance existing long-term debt as it matures and may desire to obtain additional long-term ? nancing for other corporate purposes. We anticipate no dif? culty in obtaining long-term ? ancing in view of our credit ratings and favorable experiences in the debt market in the recent past. The following table details the ratings of the credit rating agencies that rated our outstanding indebtedness at January 31, 2010. The rating agency ratings are not recommendations to buy, sell or hold our commercial paper or debt securities. Each rating may be subject to revision or withdrawal at any time by the assigning rating organization and should be evaluated independently of any other rating. Global Expansion Activities Cash paid for property and equipment was $12. 2 billion, $11. 5 billion and $14. billion during the ? scal years ended January 31, 2010, 2009 and 2008, respectively. These expenditures primarily relate to new store growth, as well as remodeling costs for existing stores. We expect to incur capital expenditures of approximately $13. 0 billion to $15. 0 billion in ? scal 2011. We plan to ? nance this expansion and any acquisitions of other operations that we may make during ? scal 2011 primarily from cash ? ows from operations. Fiscal 2011 capital expenditures will include the addition of the following new, relocated and expanded units in the U. S. : Fiscal Year 2011 Projected Unit Growth Walmart U.S. Segment Sam’s Club Segment 145-160 5-10 150-170 Total U. S. Additionally, the International segment expects to add more than 600 units during ? scal year 2011. The following represents an allocation of our capital expe nditures: Rating Agency Commercial Paper Standard & Poor’s Moody’s Investors Service Fitch Ratings DBRS Limited Long-term Debt A-1+ P-1 F1+ R-1(middle) AA Aa2 AA AA To monitor our credit ratings and our capacity for long-term ? nancing, we consider various qualitative and quantitative factors. We monitor the ratio of our debt to our total capitalization as support for our long-term ? nancing decisions.At January 31, 2010 and January 31, 2009, the ratio of our debt to total capitalization was 36. 9% and 39. 3%, respectively. For the purpose of this calculation, debt is de? ned as the sum of short-term borrowings, long-term debt due within one year, obligations under capital leases due in one year, long-term debt and long-term obligations under capital leases. Total capitalization is de? ned as debt plus total Walmart shareholders’ equity. Our ratio of debt to our total capitalization decreased in ? scal 2010 primarily due to a decrease in short-term borrowings. W e expect to incur capital expenditures of approximately $13. 0 billion to $15. billion in fiscal 2011. We plan to finance this expansion and any acquisitions of other operations that we may make during fiscal 2011 primarily from cash flows from operations. Allocation of Capital Expenditures Projected Capital Expenditures New stores, including expansions and relocations Remodels Information systems, distribution and other Total U. S. International Total Capital Expenditures Actual Fiscal Year 2011 Fiscal Year Fiscal Year 2010 2009 31% 15% 29% 17% 34% 10% 21% 23% 20% 67% 69% 64% 33% 31% 36% 100% 100% 100% Common Stock Dividends We paid dividends of $1. 09 per share in ? scal 2010, representing a 15% increase over ? cal 2009. The ? scal 2009 dividend of $0. 95 per share represented an 8% increase over ? scal 2008. We have increased our dividend every year since the ? rst dividend was declared in March 1974. On March 4, 2010, the company’s Board of Directors approved an increase in the annual dividend for ? scal 2011 to $1. 21 per share, an increase of 11% over the dividends paid in ? scal 2010. The annual dividend will be paid in four quarterly installments on April 5, 2010, June 1, 2010, September 7, 2010 and January 3, 2011 to holders of record on March 12, May 14, August 13 and December 10, 2010, respectively. 4 Walmart 2010 Annual Report 107077_L01_FIN. indd 107077_L01_FIN. indd 24 4/6/10 8:25:52 PM Management’s Discussion and Analysis of Financial Condition and Results of Operations Company Share Repurchase Program From time to time, we have repurchased shares of our common stock under a $15. 0 billion share repurchase program authorized by our Board of Directors on June 4, 2009 and announced on June 5, 2009, which replaced and terminated a $15. 0 billion share repurchase program approved by our Board of Directors on May 31, 2007 and announced on June 1, 2007.As was the case with the replaced share repurchase program, the new program has no exp iration date or other restrictions limiting the period over which we can make our share repurchases, and will expire only when and if we have repurchased $15. 0 billion of our shares under the program or we terminate or replace the program. Any repurchased shares are constructively retired and returned to unissued status. We spent $7. 3 billion, $3. 5 billion and $7. 7 billion in share repurchases during ? scal year 2010, 2009 and 2008, respectively.We consider several factors in determining when to execute the share repurchases, including among other things, our current cash needs, our capacity for leverage, our cost of borrowings and the market price of our common stock. As of January 31, 2010, the program had approximately $9. 2 billion remaining authorization for share repurchases. Contractual Obligations and Other Commercial Commitments The following table sets forth certain information concerning our obligations and commitments to make contractual future payments, such as debt and lease agreements, and contingent commitments:Payments Due During Fiscal Years Ending January 31, (Amounts in millions) Recorded contractual obligations: Long-term debt Short-term borrowings Capital lease obligations Unrecorded contractual obligations: Non-cancelable operating leases Interest on long-term debt Trade letters of credit Purchase obligations Total commercial commitments Additionally, the company has approximately $11. 2 billion in undrawn lines of credit and standby letters of credit which, if drawn upon, would be included in the liabilities section of the Consolidated Balance Sheets.Purchase obligations include legally binding contracts such as ? rm commitments for inventory and utility purchases, as well as commitments to make capital expenditures, software acquisition/license commitments and legally binding service contracts. Purchase orders for the purchase of inventory and other services are not included in the table above. Purchase orders represent authorizati ons to purchase rather than binding agreements. For the purposes of this table, contractual obligations for purchase of goods or services are de? ned as agreements that are enforceable and legally binding and that specify all signi? ant terms, including: ? xed or minimum quantities to be purchased; ? xed, minimum or variable price provisions; and the approximate timing of the transaction. Our purchase orders are based on our current inventory needs and are ful? lled by our suppliers within short time periods. We also enter into contracts for outsourced services; however, the obligations under these contracts are not signi? cant and the contracts generally contain clauses allowing for cancellation without signi? cant penalty. Total 2011 2012-2013 2014-2015 Thereafter $37,281 523 5,584 $ 4,050