WAL-MART LOGISTICS

Wal-Mart Logistics

Wal-Mart Logistics

Introduction

Wall-Mart has been a giant in its industry and playing a leading role among all competitors. It recorded a profit of four hundred billion dollars in the year 2008. It has a huge area of more than the size island of Manhattan. If we consider it a country then it will be 26th largest economy of the world. It contributes the largest part in the employment generation in United States, employing more than 1.4 million workforces. In The Wal-Mart Effect, Charles Fishman gave the explanation of economy as “suspiciously camouflaged as somewhat regular, known, even ordinary. But actuality, Wal-Mart is a entirely innovative type of organization: contemporary, highly developed, strong in traditions we've never seen before . . . Wal-Mart has outgrown the system — but no one notice.” Wal-Mart has been claimed as the most powerful company of the world ever exists by Charlie Rose. Wal-Mart has a competitive advantage due to its very string supply chain network, its logistics network born out all the way through passion with distribution, information, and efficiency. Wal-Mart keeps its operations concerns with the territory, observe them intimately, and analyze its supply chain network's effectiveness closely in order to reduce costs and get control over it. James Huston, a historian, explains logistics as "the application of time and space factors to war.”

How Wal-Mart Use Logistics to Control Costs

Wal-Mart's policy occupies an entire system of actions (cross docking, distribution center management, electronic inventory systems, supplier networks, etc) that are linked to fit and reinforce one another. Logistics management by way of cross docking allows seamless “just in time” inventory delivery and minimizes the cost of inventory sitting idly in distribution centers. Wal-Mart's inbound logistics costs are far less than those of their competitors. In addition, distribution centers are highly automated and run 24 hours a day. They use a strategy called operational excellence which allows them to deliver their products and services with minimal difficulty or inconvenience and also lower costs.

Wal-Mart has designed its infrastructure according to requirements of local market. Wal-Mart located its store in the dense populated areas, according to a study almost sixty per cent of population of US lives in area of five miles of Wal-Mart stores locations, and almost ninety six per cent of population lives in the area of 20 miles of the locations of Wal-Mart's stores (Brunn. S, 2006). This is how Wal-Mart caters ...