WAL-MART

Supply Chain Management of Wal-Mart

Abstract

In this study, we try to explore the concept of “supply chain management” in a holistic context. The main focus of the research is on “supply chain management” and its relation with “Wal-Mart”. The research also analyzes many aspects of “supply chain management” and tries to gauge its effect on “Wal-Mart”. Finally, the research describes various factors, which are responsible for “Supply chain Management” and tries to describe the overall effect of “Supply chain Management” on “Wal-Mart”.Supply Chain Management of Wal-Mart

Thesis Statement

“Wal-Mart is located between two worlds: the world of Sam Walton built the "everyday low price offer" through the adoption of effective solutions, based on information technology and the new global market space”.

Introduction

Sam Walton opened his first retail store in a large area in 1962 under the name of Wal-Mart Discount City. In 1969, he incorporated his company, Wal-Mart Inc. and constructed its headquarters and its first distribution center in Bentonville, Arkansas. Wal-Mart took 30 years to mesh the area of logistics platforms from which it launched a systematic conquest of local markets. The company passed the milestone of one billion dollars in sales per year in 1980, one billion per month in 1986, and one billion a week in 1992. It is now more than five billion U.S. dollars of sales per week. The company's strength is impressive sales are higher than those of its direct competitors combined (Target, Sears, Kmart, JC Penney, Safeway and Kroger), and finally, the U.S., its sales are 7.5% of all those in the retail trade (excluding auto parts).

Discussion

Managing the Supply Chain at Wal-Mart

Wal-Mart is the world's largest retail operation, with over $400 billion in annual sales, 4,100 stores in the United States, and 3,500 stores overseas. In 2009, Wal-Mart was the highest-volume grocer in the United States, with approximately $100 billion in sales and a 21 percent share of the grocery market.

For over 40 years, the management of Wal-Mart has only one obsession: to reduce costs for reduction of prices and increment of sales. The innovations introduced by Wal-Mart are based on this objective. For this purpose, the frugality of the bosses of Wal-Mart, who continue to share their hotel room to reduce costs, is legendary, and the headquarters of the inter-making a building is dull without extravagance. Finally, another feature of the system is Wal-Mart's low pricing policy that constant eliminates promotions. In this way, the company ensures greater stability in its sales, avoiding situations of overstocking or stock-outs from the vagaries of request. Moreover, it is the responsibility of each store manager to ensure that Prices are really the lowest daily.

Vendor management

The company has 30,000 suppliers (there were over 1100 in Quebec in 2002). The power of the chain is so large that no less than 450 suppliers have opened offices, mainly in the 1990s, near the headquarters of Wal-Mart. This is become the largest customer of many major consumer products companies, as Kraft, Gillette and Procter & ...