Definition: “virtuous circle” – noun
- a recurring cycle of events, the result of each one being to increase the beneficial effect of the next
Sam Walton built a business, Wal-Mart, that is now the biggest retailer in the world; what is extraordinary – the work of a genius – is the fact that he created from scratch an incredible, unbelievably simple, innovative retail business model:
- leverage logistical superiority, to have a faster and more efficient distribution system
- offer the lowest price possible (relying on higher volumes to sustain profitable growth)
- leverage purchasing-power to buy at ever-lower prices from suppliers
This is what I call an awesome “virtuous circle”…
…and a very good lesson for many modern retailers.