Short Paper: Attn Suraya or Colleen

Wal-Mart: A Case Study in Supply Chain

Logistics was a focus of Sam Walton of Wal-Mart, and today Wal-Mart is a leader in the field of supply chain management.  The company, however, is not complacent with this label and continues to strive toward excellence and to expect the same from its vendors.  The company continues to institute new initiatives. 

Wal-mart looks for ways to improve its supply chain processes, never accepting the status quo.  It has viewed logistics as a way to differentiate itself form its competition and to improve service to its stores.   Developing close relationships with its suppliers has been a cornerstone of its approach toward its supply chain, redefining the supply chain concept along the way.  Core portions of its focus have been:

1. investment in and use of technology.

2. mechanization and automation

3. automatic replenishment of store inventories triggered at point of sale

4. co-managed inventories with suppliers:  data accumulated at point of sale (basically the registers) may trigger production by suppliers and replenishment of product.

Efficiency and productivity improvements in the supply chain have been passed along to consumers though lower prices and better service (merchandise availability).

Wal-Mart has challenged its vendors to improve.  For example they have pushed their suppliers of warehouse automation equipment to modify and improve their equipment to become state-of-the-art.

The efficient layout of Wal-Mart distribution centers has been another thrust of the company.  Rather than outsourcing its trucking, Wal-Mart has maintained its own fleet of vehicles and drivers with 100% focus on the company.  Their trucking associates coordinate closely with the distribution associates.  Trucks have on-board computers, and there is a focus on matching deliveries to stores with pick up of merchandise from suppliers on return trips.  There is a comprehensive backhaul operation to improve efficiency. 

Wal-Mart has made environmentally friendly practices a priority.   Efforts to reduce the amount of packing, fuel conservation and reduction of its carbon footprint in trucking practices, energy efficient stores and distribution centers are just a few of its initiatives.   On its website http://walmartstores.com/sustainability/, Wal-mart states that its environmental goals are:

            “To be supplied 100 percent by renewable energy”

            “To create zero waste”

            “To create products that sustain people and the environment.”  

References

Emmett, Stuart (2005). Excellence in Warehouse Management. New          Jersey: John Wiley & Son, Ltd.