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That’s the question posed by BusinessWeek, as it considers not just what makes Wal-Mart different, but what possibly could cause the world’s biggest retailer to stumble.

Here are the basic conclusions reached by BusinessWeek:

  • It’s usually harder to maintain dominance than to achieve it, as McDonald’s and Home Depot have discovered – largely because they lost sight of the customer and got so focused on efficiency that they ignored the needs and desires of their core shoppers.

    Implicit in this argument is the notion that while Wal-Mart clearly has developed the most efficient business model, it remains committed to the store experience and responding to its shopper base. And there is no sign this will change as Wal-Mart continues to expand.

  • BusinessWeek also notes that while Wal-Mart seems ubiquitous, it in fact has plenty of markets in which it is under-represented…unlike McDonald’s, which now is in the position where it is shuttering underperforming stores. Home Depot, the magazine writes, may be getting “perilously close to market saturation.”

  • Wal-Mart continues to be able to expand by creating new, growth-sustaining formats, like the Neighborhood Market concept. While McDonald’s and Home Depot have tried to do the same thing, they have not been particularly successful. McDonald’s, for example, is considering a sale of at least part of its stake in its non-burger restaurants.

    And Wal-Mart continues to explore new areas, such as like gasoline, insurance, and banking services

  • So what can bring Wal-Mart down? There is the possibility that its size could inevitably decrease its connection to the consumer, and that backlashes against the chain from various sources could eventually come home to roost.

    And, there’s the big potential problem that many of Wal-Mart competitors keep hoping will deliver them from the vise in which they find themselves -- antitrust action against it by the federal government because of the same concerns that drove the case against Microsoft.

KC's View:
Great piece in BusinessWeek.

We wouldn’t hold out much hope for an antitrust case against Wal-Mart…though if we had a dollar for every retailer that has told us they just want to stay in business until the government puts it out of business…well, we could buy something pretty nice. Not a car, but maybe a nice sport coat.