Walmart Supply Chain Management

Topics: Supply chain management, Supply chain, Inventory Pages: 4 (493 words) Published: April 19, 2015
Relationship with Suppliers
• To bring their customers the lowest prices and best products possible, Virtual Companies is the best supply chain strategy for them. Cost of sales worked out to be 2-3%(very low from
industry average)
• Walmart generally starts out smaller suppliers in a local market, delivering goods to up to 50 stores, as a test run. If the supplier provides a high-selling product and proves
reliable, it might be considered for national distribution.
• Example: Wal-Mart and Proctor & Gamble built a software
system that hooked P&G up to Wal-Mart’s distribution
centers.  This system would then monitor supply levels and
when products run low, automatic alerts are sent out to
require the shipment of more products to that distribution
center. 

Using IT
• Wal-Mart known for innovative business practices. One of the first retailing companies to centralize distribution system. Always among the front runners in employing IT to manage its supply chain processes. • In 1977, Wal-Mart set up a computer terminal network to establish a communication link between its store and the company headquarters. • Wal-Mart use EDI for procurement. EDI would help store managers to place orders in the manufacturing division by using bar code scanners to analysis sales data.

• Wal-Mart has used RIFD tags, which use numerical codes that can be scanned from a distance to track pallets of merchandise moving along the supply chain. Even more recently the company has begun using smart tags, read by a handheld scanner, that allow employees to quickly learn which items need to be replaced so that shelves are consistently stocked and inventory is closely watched.

• The major disadvantage of RFID is privacy concern towards RFID devices. Some claim that Wal-Mart is infringing on natural rights by overseeing what customers buy.

Cross-docking









To make its distribution process more efficient, Wal-Mart also made use of a logistics technique called...
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