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Difficult market entry: Formidable barriers to entry. For example, exclusive financial requirements. Price very close to cost which does not interest the entrant.
With effective inventory management, low wages to employees, larger work force, pressure on suppliers to reduce costs, Wal-Mart ensures that the average cost is very low as compared to other competitors in the market. Wal-Mart would still reap profits, it being a preferred retailer for majority of the customers but would exert a pressure on firms that are not able to reap any profits due to high infrastructure costs, high procurement costs and a low customer base forcing them to exit the market...
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