Wk 6 Summative Assessment: Capital Structures Financial Plan

Walmart is growing to be a major, family-run, publicly-traded company renowned for its retail and wholesale operations. There are three revenue-generating sectors at Walmart. Sam’s Club, Walmart International, and Walmart U.S. are his segments. In the fiscal year 2022, Walmart earned $567.8 billion from these three divisions. The operating results of the company are affected differently by each component.

A business plan that details the nature of the proposed venture, its financial sources, and its description

The approach I would probably take is to ensure that marketing is at its best since if any business, even one as big as Walmart, did not have excellent marketing and a niche to surpass its rivals, Walmart would be another store. The people who can provide a lot for the community at a reasonable cost will market themselves, which is why Walmart excels at what they do. Walmart has a diverse representation and is aware of its target market. A well-known multinational retail corporation is Walmart. With your size, you must comprehend each audience, particularly the areas in which Walmart stores will be opening, as well as the various county and state laws. The safest type of financing is equity since it allows for the immediate sale of some firm shares for cash.

This kind of funding is for a sizable future investment. Reopen more Walmart stores with the knowledge that you can recover the shares you borrowed, plus more. A three-year profit and loss statement.

Walmart experienced a loss in 2019–2020, and the pandemic was to blame. Many companies were closing their doors and going out of business at that time. Most firms had a difficult time during that period; even now, they are still trying to get out of that hole.

The profit and loss chart gradually rises (see chart below).

Walmart’s sales increased by 74% year over year to $152.813 billion for the three months that ended October 31, 2022.

Walmart’s revenue for the year ending October 31, 2022, was $600.112B, a rise of 4.92% over the previous year.

Walmart’s yearly revenue for 2022 increased by 43% from 2021 to $572.754B.

Walmart’s yearly revenue for 2021 increased by 72% over the previous year to $559.151 billion.

Walmart’s yearly revenue for 2020 increased by 86% over the previous year to $523.964B.

Project income. In your estimates, include reasonable assumptions, such as an increase annually.

Walmart’s revenue model is based on the idea of making large purchases all at once. They received a sizable discount from the manufacturers under this scheme. They offer inexpensive pricing and tiny amounts of product. By lowering the price, they are able to generate a large number of sales, which results in huge profits. Walmart makes money by cutting out the middleman and offering its goods and services directly to consumers and businesses. Product revenue and service revenue are the two primary sources of income.

Calculate your direct costs, which include those for capital, marketing, labor, and supplies.

Customers trust Walmart’s pricing philosophy and business approach because it consistently offers products at affordable costs, even during regular sales promotions. Walmart has pledged to limit costs so that cost savings can be passed on to customers through its Everyday Low Cost (“EDLC”) program. In addition, Walmart’s U.S. operations offer internal advertising through Walmart Connect, supply chain management, and fulfillment services to online marketplace vendors through Walmart Fulfillment Services. This would make it possible for Walmart to receive more reviews. The audience would be attracted by good product advertising or marketing, but of course, that would depend on who the audience was (adults, babies, young adults, or teens). Walmart just launched Walmart GoLocal, a new delivery service that enables customers to have their purchases delivered right to their front porches. With its broad reach and affordable delivery options, Walmart’s delivery service enables businesses to expand. This includes the ability to meet various deadlines and deliver on a variety of assortments, including those with large and complex requirements. The company will quickly grow in order to provide more cutting-edge services.

This is a crucial period for Walmart since being able to compete with Amazon and having other businesses enter into agreements to market, sell, and transport their products will enable Walmart to generate more income how. Walmart succeeds by buying goods in bulk from regional producers at once and selling them in small amounts. Both parties profit from purchasing goods from regional producers. More purchases from regional producers result in more jobs being created and a lower unemployment rate. In order to keep their customers happy and continue to make money, they need to offer high-quality goods at lower prices.

A summary that details the benefits that following a financial plan might have for a larger organization.

A sound financial strategy is the cornerstone of any successful firm, big or small. The business must be aware of the problem and its impending arrival. What do they hope to achieve for the business over the short and long term, and how will they do it?

Walmart believes in the strategy of dominating the market by giving consumers reduced costs and competitive prices. They have a strong niche. Also, it will help you consider what is significant, such as what business you would want to invest in and how to convince other companies to acquire what you are selling. Knowing how you will spend the money is also crucial, in addition to everything else. Even with an accountant and checks and balances, it will be challenging to succeed if there is no game plan or quick wins. It is more challenging but not impossible.

Reference:

Goel, Shikhar (2022). How does Walmart make money: Business Model & Supply Chain Strategy. https://thestrategystory.com/2022/12/01/how-does-walmart-make-money-business- model-supply-chain-strategy/#

Walmart. (2021). Walmart Launches Walmart GoLocal, a New Delivery as a Service Business. https://corporate.walmart.com/newsroom/2021/08/24/walmart-launches-walmart-golocal-a-new- delivery-as-a-service-business

StartupTalky. (2022). A Detailed Case Study on Largest Retail Giant Walmart. https://startuptalky.com/case-study-of-walmart/

Macrotrends LLC. (2010-2023). Walmart Gross Profit 2010-2022 | WMT. https://www.macrotrends.net/stocks/charts/WMT/walmart/gross-profit

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You as the business manager need to be able to determine larger sources of funding by creating a financial plan to help reduce duplication of resources, identify requirements and risks, and determine various financing options. Completing this planning is an important step for all businesses to take if they want to succeed. Larger companies may delegate this process to financial managers, financial analysts, or operations managers.

You decide to create a financial plan for your company to help distinguish between sources, requirements, and risks associated with various types of long- and short-term financing capital structures that your company can potentially use in the future.

Assessment Deliverable

Draft a 3- to 4-page financial plan for your company. This plan should include sections for a business case and profit-and-loss statements. Include the following items:

• A business case that includes a description, type of business, and sources of funding
• Note: Use your Wk 5 Assessment Prep: Business Case Research assignment and feedback.
• A profit-and-loss statement for a 3-year period
• Project revenue. State realistic assumptions, such as growth per year, in your projections.
• Estimate direct costs, including capital, marketing, labor, and supply costs.
• A conclusion that includes an explanation of what working through a financial plan can do for a larger company

Cite references to support your assessment according to APA guidelines.

Submit your assessment.

Assessment Support

• Rubric for guidance on deliverable expectations

Note Please:

Writing Standards – Please follow all APA formatting requirements, in-text referencing requirements, and referencing for all work – induing discussion questions, participation, presentations, etc. Support all assertions. The UOPX APA Sample Writing Paper is an excellent resource.

Originality – if you submit work with more than a 10% Turnitin match ( properly referenced or not) the work will be reviewed for originality. Work with originality issues will be scored a zero.

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