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WalMart Supply String Management analysis

Keywords: walmart resource chain analysis, resource string management walmart, walmart scm

Wal-Mart, a multinational retail firm is known as to be one of the fastest growing firms in the resource chain and retail management. Its occurrence in America and Latin America is huge. The ere have been numerous studies regarding Wal-Mart and its operation, the strategies and everything areas of its managements, given the fact that Wal-Mart as a company is considered to be a head in the retail portion of the industry in America and worldwide.

In order to meet up with the global demands of these presence, Wal-Mart requires getting into make effective supply chain management and its own thinking is the call of the hour. We believe that Wal-Mart strategies are resilient enough in that regard. This survey also presents some significant finding of Wal-Mart resource string management strategies, which is a pioneer for the industry.


Supply chain management is a intricate process involving the intricacies of top of the end management procedures. As we are aware with the reality, the earth today in the background of globalization and its impact is interlinked. Considering business production or retails units as well, it is quite apparent that organization needs effective coordination and cooperation with suppliers as a means to ensure that products and services grows to the market without the hiccups, which further enable such company to provide their customer better.

It is prudent to select a company with an international presence to analyze the components of supply string thinking and its own management aspects. Because of this, the company chosen for the purpose of this study is Wal-Mart, market innovator in the global retail industry. The objective behind this survey is to recognize the styles and strategies followed by Wal-Mart in the backdrop of globalization and its impact, plus the effect of tournaments on the inventory management routines as well as the technological shift that the company have integrated for streamlined functions in their source chain management processes overall, which is reviewed below.


In the retail industry, the most important trends and its characteristics are described by their reliance on consumer spending behaviors. This is exactly what we generally seen happens generally, whether through the memories or furthermore. Retails industry serves it customer through their retail stores, such as grocery outlets and departmental stores, which is the most typical example we can come with regarding the characteristics in retail industry.


Global retail industry and "its range is known as to be quite huge in character of their life, " (RetailDirectory) which holds true and factual. In term of the industry movements in the current plans of things, retail industry in regarded as amidst the frontrunner for the most notable devote the global rank. That is to say, retail industry is speculated to be the next major industry on a global scale" (RetailDirectory) in term of earnings generations and sales encompassing their businesses and its own characteristics.


The developments that is fast finding up today in the retail industry are in the types of "e-commerce, for sales stores or marked down stores to be precise, surge of the mall culture and departmental stores, which are a few to name here. " (RetailDirectory)

The tendencies are changing throughout. In US and UK, retail is an enormous industry per contrast. However, after "the recession in the first part of 2009, there's been a sharp decrease in retail, " (Ystats) although big store in the industry still have their major talk about of the marketplace.


Above mentioned conversation gives a glimpse of the tendencies and characteristics in global retail industry. Four major retail companies are Wal-Mart, Home Depot, Kroger and Tesco.


Wal-Mart is a worldwide leader in the retail industry, based in US. The company since its founding days has come far and wide to command a location for itself in the industry today. What has been the significant change of tide in favor of Wal-Mart can be emphasized to its source chains strategy. Wal-Mart today is "considered to be a market innovator in term of occupation in the private sector. It has been asserted by industry expert that Wal-Mart achieved the position of leader in the retail industry because of its effective supply chain management strategy. " (P Mohan Chandran)

Wal-Mart supply chain strategy is very effectively because it adapts to change and dependence on the market. "The company commitment to improve operations, lowering the cost factor and building romantic relationship with customer in the best possible way is dome of the strategic view that is reliant to the company principle and its own visions. " (Private)

The supply chain management adopted by Wal-Mart are strategically effective, which indicate the points that "abundant attention is given toward 'procurement and distribution' of its products, services and everything in the retail segmentations that are aligned to 1 single systems. With over 40 distribution centre, Wal-Mart occurrence throughout the world in framework of its procurement and circulation is huge and influential factor. (P Mohan Chandran) Besides, the company also is very specific to meet up with the tactical formulation in the perfect ways, wherein its operations in the logistic segment, its syndication as well as transport and integration of technology employs the best industrial techniques. (Anonymous) These four components are what define the main element proper key of Wal-Mart.

Specific details to Wal-Mart logistic management can be emphasized to the components "encompassing fast, reliable and reactive transportation facilities. Most importantly circulation centre of Wal-Mart are also serviced by company possessed carry vehicle and vehicles to facilitate a fast, reliable and effective logistics in one centre to some other. " (P Mohan Chandran) That is one of the primary strategic power that Wal-Mart features of so far as logistic segmentation goes in its business operational expertise.

Thus, when we turn to these features as details, we believe that Wal-Mart key supply chain strategy and its adoption is the durability accumulated in four segmentation of its business, particularly logistic management, procurement and circulation, inventory management & most importantly scientific integrations. These four element in the supply string management strategy of Wal-Mart in the retail industry are the streamliner of its business procedure and regarded as a tactical tools followed by Wal-Mart, that have helped better its business operation to a great magnitude.


As we have described above, Wal-Mart supply chain strategy and its strength are comprised into four factor, they will be the integration of technology, procurement and distribution, inventory management and effective logistics components. Due to that, the other factor that comprised the strength of Wal-Mart in resource chain management is their emphasis and greater make that is "concentrated in building a prolonged and fostering relationship with customers, its employees, and suppliers, " (P Mohan Chandran) who the company overall comprised the stakeholder in the business in deciding its fate in the market.

Considering these facts, the major difference in Wal-Mart supply chain management to that of other organizations in the retail industry in US and somewhere else will be the factor of "its mix docking operational know-how adopted by the company in meeting its supply chain management techniques. " (P Mohan Chandran) As the truth is, Wal-Mart "in recent time since 2000 have spent heavily in cross docking, which is its unique factor that also defines its inventory mechanism, often regard by analysts as a major factor. The main factors which have helped Wal-Mart through its unique combination docking inventory mechanism are its benefits derived in framework of economical of level and cost of sales that are reduced significantly through such functions. " (Echeat. com)

Besides, Wal-Mart and its own management also put in a "significant timeframe in achieving their distributors, suppliers, marketers as a factor to understand what switches into the price in advertising and procurement, etc which is an exemplification of a highly effective negotiation process that switches into the making of computer. " (P Mohan Chandran)


As we have detailed in Table 1. 1, there is a clear indication that starting from the entire year 2000 to the finish of the fiscal time 2002 Wal-Mart was market leader. In the current stage as well, Wal-Mart grosser is huge. Their management of the supply chain is actually an industry exemplory case of the effective system taking forms, and easing the process through the integration of technology, human understanding, building romance and most essentially participating to the needs and wants of consumer, which is one success factor in basic financial sense which is understanding.


Globalization has already established both the positive and negative effect on Wal-Mart supply chain strategy and its management. However, on a greater note, we feel that Wal-Mart supply chain strategy have benefitted greatly from globalization. One example of it can be said in context of the business retail chains and its presence across national boundaries, be it in Mexico, Latin America and major part folks and Canada. Increase it, "with around 7000 stored throughout the world, and 120 major syndication units globally, with an procedure that period across 15 nationwide economies, (Anonymous) is one good exemplification to reason the factor attached to Wal-Mart and the impact globalization have onto it.

Some case of globalization and effect on Wal-Mart source chains management is seen in framework of 'superior inventory process, technology, circulation channels and combination docking as well as sales monitoring systems that are quick in process formulation and information exchanges. " (Anonymous)


In the inventory section as we've detailed, Wal-Mart take up a streamlined measure in that respect, in order to keep a low level of inventory. Due to that "the investment made by the business in framework its combination docking mechanism and its own inventory. In another term, Wal-Mart combination docking inventory "and its own integration have enabled the company the ease and capability of complexities involved in the process of inventory management. " (Echeat. com)

Besides Wal-Mart "adoption of the fast travelling facilities that are serviced and backup by the business owned truck and offer vehicles that identifies the effective travelling facilities overall will save a tremendous amount of time, which is often damage in business deal or shipping and delivery, which also reduces the price in that respect. " (P Mohan Chandran) This is actually the benchmark of Wal-Mart inventory practices and a model for emulation in the global retail industry.


Technology as in any other industry has it effect. The same has been Wal-Mart and their integration of technology in fostering a highly effective operational process in is supply chain management. It is "speculated that Wal-Mart has one of the major IT system within its corporation structure, where technological integration and its influence is enormously huge" (Anonymous) and play a substantial part in Wal-Mart supply chain.

The main solutions implemented by Wal-Mart in its source string management are particularly the following:-

Universal Club Code: This is the to begin its kind "technology presented by Wal-Mart in the retail industry. The principal objective of the universal pub code adopted by Wal-Mart is to effect a result of a change in retail industry pub coding system for common labeling. That is slightly a great technology adopted by Wal-Mart that improved its business process, considering that it generates all types of information required which is specific. " (Wilbert)

Radio Frequency Identification Technology (RFIT): This technology utilized by Wal-Mart "integrates the progression of radio frequency to spread data and any relevant stored data within the company intranet and extranet system. " (Wilbert)

Magic Wand: This is a handheld device used by Wal-Mart in its stored throughout the world. This handheld device are mainly carried out by the help of computer systems and employ the idea of sales (POS) system and its own integration, which help checking sales of product and tracking the merchandise to get effectively. (P Mohan Chandran)

Considering these three scientific advancement, we feel that Wal-Mart integration of technology in its source string management is huge and influential.


Supply chain has always been in the process of existence. But in the current scenario, supply string thinking and its management features have gone through tremendous change and transformation, given the climb of multinational companies (MNC).

Wal-Mart circumstance is also no different. Wal-Mart resource chain process in the current scenario is targeted at enhancing operational know-how. It has been a reality, and the sales statistics which have increased since 2000 till the current years shows the change in company standing. Besides being the world 2nd largest dealer in term of sales says a lot about Wal-Mart performance in term of sales, strategy, and success factor and brand image.

Surprisingly, retail and its own market cap in Asia have risen drastically recently. Research carried out by global research company, Ystats. com emerged to the key results that "retail spending in major market where retail command line a place on the global range have declined, that is at UK and US market. The developments thus have shifted to Asian market, such as China, India and Japan in today's time. " (Ystats)


It is recommended that in the current time Wal-Mart should take more procedure towards:-

  • Enhancing their associates and building marriage, so that it helps the business to further expand.
  • Given the pattern in Asian retail growth in the current, it's a good idea for Wal-Mart to broaden their retail chain in Asians market, whether it be in India, and China.
  • Improvement of their process always calls necessarily.
  • Continuous improvements and learning's.
  • Emphasizing on variety programs.
  • Employee's commitments and their concentration on employees with special needs.
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