The sales of the company have been declining over the years while the inventory in stock for sale is increasing dramatically. Billions of dollars worth of products are held up in inventory due to the loss of strategic advantage that the company has in terms of its distribution system.
5.2 High Price / Overheads
The overheads for the company are increasingly dramatically as well, rising to 18.6 percent of sales as recorded in the case in 2006-2007. Overheads for the company have risen due to investment in PR functions, enhanced security, maintenance and quality improvement in the stores.
The company has been facing major labor related issues. Previously the company did not provide perks to its employees and operated on minimal wages. Now the employees are demanding better working conditions as well as compensation. Moreover the company is also facing cases of sex discrimination of females at its various operations.
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