World’s Billionaires – The most profitable businesses II: Wal-Mart
In my last blog World’ Billionaires – The most profitable businesses I: LVMH, I introduced the top 20 richest people in the world according to the Forbes Magazine. I was curious about how these billionaires make their money and what their secret of success is. One of the most profitable businesses was the fashion industry. In order to get a deeper understanding of that profitable business, I chose LVMH (Moët Hennessy Louis Vuitton) to show why and how they could become so successful.
In this blog I will examine the second most profitable business of the worlds billionaires, which are retailer and discount chains. 5 out of the top 20 world’s richest people are having their business in that field.
Karl Albrecht, ranked as the 10th richest person in the world, is a German entrepreneur who founded the discount supermarket chain Aldi with his brother Theo. His estimated net worth is US$ 25.4 billion in 2011. Albrecht is also the wealthiest person in Germany.
Because of a discount supermarket chain, named Aldi, not only Karl Albrecht became one of the wealthiest people in the world but also his brother. For sure, Aldi yields a respectable revenue that last out even for two brothers. But now I will present a retailer chain which makes a whole family to the probable wealthiest family in the whole universe!
- Massive buying power: Wal-Mart is able to provide low prices as is has massive buying power.
- Operational excellence: The philosophy behind operational excellence is high expectations, which leads to high productivity and efficient processes and finally lower costs.
- Excellent customer service: It has developed a culture where employees are expected to think out of the box and provide customers with excellent services.
- Strong logistics & distribution network: Besides the low prices, the products are made available to consumers with minimal inconvenience. Even during the hurricane Katrina it was able to supply its stores with products quickly when other stores were out of stock for many days.
That are basically the main points why Wal-Mart is so profitable. The philosophy of saving expenses is very embedded in employees and the top management. Because the operations are handled in a way to save every possible penny, allows Wal-Mart to provide items at low cost to consumers.