Wal-Mart is about to overtake Exxon Mobil to become the world's largest company
Thursday, January 24th 2002, 12:00 am
By: News On 6
NEW YORK (AP) _ Forty years after Sam Walton opened his first Wal-Mart in Rogers, Ark., the 4,382-store global chain is about to overtake Exxon Mobil Corp. to become the biggest company in the world.
Wal-Mart Stores Inc. is on track to record more than $220 billion in revenue for the 2001 fiscal year _ exceeding Exxon Mobil's $212.9 billion. That would make Wal-Mart No. 1 on Fortune magazine's annual list of the world's 500 biggest corporations.
``Everyone needs toilet paper and toothpaste, and they're the most efficient at selling it,'' said Eric Beder, a retail analyst at Ladenburg, Thalmann & Co. in New York. ``It is really an incredible story.''
The most notable aspect of Wal-Mart's achievement, analysts said, is that a company that makes nothing would launch to the front of a list that has long been dominated by manufacturers.
``It's indicative that we've made a big shift in this country to a service economy,'' said Warren Batts, professor of strategic management at the University of Chicago business school.
Service companies did not become part of the Fortune 500 until 1995.
Wal-Mart has grown more than 10 percent annually for the past 20 years, expanding into Asia, Europe and South America.
Industry watchers say Wal-Mart's incredible success can be attributed to the business philosophy Walton swore by and which is still in practice a decade after his death: ``Try to squeeze the lowest price possible from the people who sell to you, and then pass the savings on to the customer.''
A spokesman for Wal-Mart would not comment.
Fortune magazine's list comes out in April.