Recommended final strategy: Hybrid e-tailing and physical store modelProblem: Losing ground as poster child for cost leadership ChildWal- Mart Stores, Inc.'s legendary competitive advantage in low-cost distribution and operations has eroded beyond the recovery point. Once considered the undisputed cost leader in retail, a recent study showed that after reducing taxes and shipping costs, a basket of products at Walmart cost 19% more than at Amazon.com (Jannarone , 2011). Forbes contributor Steve Denning points out that if a consumer wants something quick, they shop at a convenience store; if he wants something cheap, he will buy it on Amazon.com; and Walmart is no longer needed (Denning, 2011). Walmart has fought frantically against Amazon's superior cost leadership, but it has become clear that they can't squeeze blood from stone. Their former competitive advantage in low-cost operations – sustained for decades – is no longer as difficult to imitate as it once was. Although Walmart's financial reports still show fairly admirable ratios, their footfall in U.S. stores has declined over the five consecutive quarters ending in February 2011 (Denning, 2011). Their five-year stock performance (WMT in blue) vis-à-vis Amazon (AMZN in red) also paints a bleak picture, as shown in the chart below. Another source of growing concern about Walmart's battle for cost leadership is its impact on its negative public image as an employee-abusing and anti-union bully. Proposed solution: Interactive in-store shopping experience, although their cost leadership has been captured by targeted online retailers. , Walmart has a resource that is valuable, rare, difficult to imitate and supported by an organizational structure ready to take advantage of it. Wa...... middle of paper ......ping Day of the season. Retrieved January 19, 2014 from Walmart.com: http://news.walmart.com/news-archive/2013/11/29/black-friday-shoppers-have-spoken-walmart-delivers-biggest-shopping-day - of the seasonWal-Mart Stores Inc. (2013). Our story. Retrieved January 19, 2014, from Walmart: http://corporate.walmart.com/our-story/ Wal-Mart Stores Inc. (October 1, 2013). Walmart announces new large-scale centers dedicated to fulfilling online orders. Accessed January 19, 2014, from Walmart.com: http://news.walmart.com/2013/10/01/walmart-announces-new-large-scale-centers-dedicated-to-filling-online-ordersYglesias, M ( October 21, 2013). Why Walmart's e-commerce will almost certainly fail. Retrieved January 19, 2014, from Slate.com: http://www.slate.com/articles/business/moneybox/2013/10/_walmartlabs_why_walmart_won_t_succeed_ in_e_commerce_even_if_it_does_everything.html