Wal Mart 's Supply Chain Essay

Wal-Mart is a brand that is well known around the world, especially in the USA. It has gradually developed into the largest retailer in the world. Wal-Mart’s globalization efforts have been happening rapidly. But have they been successful in all aspects of their international expansion or not? This is the main thought that is going to be discussed in this essay. The questions I will be looking at are based on a case called “Wal-Mart takes on the world” from the book of International Business The Challenge of Global Competition eleventh edition – Ball, McCulloch, Geringer, Minor, and McNett. Questions are the following:

1) Should Wal-Mart be expected to protect small businesses in the communities within which it operates?

Retail super-giant Wal-Mart has fought its way to becoming the world's largest company. Wal-Mart’s legendary supply chain technology has allowed them to break the three-day barrier that some economists in the eighties felt that it was unbreakable. In other words, Wal-Mart is often able to replenish items on the Wal-Mart shelf in less than three days – not from the central warehouse to the shelf, but from the manufacturer to the shelf. With quick and reliable 2-day turn around, Wal-Mart is able to maintain lower levels of inventory and still meet customer demand. These lower inventory levels result in either a reduced floor plan with lower carrying costs and lower interest expense – or a greater diversity of products on the store shelves.

Retail super-giant Wal-Mart has fought its way to becoming the world's largest company. Much of their success can be attributed to providing a vast assortment of products at exceptional prices all under one roof. Wal-Mart began operations in 1964 and has since become the world leader in retail. Today, Wal-Mart is visited by 138 million customers per week at their 4,750 stores. Wal-Mart operates under four basic rules in order to satisfy such a large number of customers:

The value delivery option is another component that supports the supply chain. Providing attention to the changes within consumer demands that will aid in rapid production of consumer products. In order to gain a larger view of the said component it is vital that the value-based method must be clearly understood. Based on the findings of (Feller, A., Shunk 2006).the ability to realign the structure of the supply chain, this process will allows the supply chain to sustain its effectiveness by adopting to changes in consumer necessities with merchandises of larger value. A diversified supply chain is constructed to match the overall components of the chain with customers need in mind. But if this construction of the supply chain doesn’t match the needs it will make nearly impossible for the organization to provide said products and services to the consumer.

4. Relations with Suppliers- Wal-Mart has in place a system that helps to achieve their goal of lower prices. This Information Technology system includes computers, networking, and internet that cuts inventories and waste and helps with speedy delivery. This system also helps Wal-Mart to keep in constant contact with suppliers by transferring the data that suppliers need so they know what Wal-Mart needs. Wal-Mart also works with suppliers to improve their production and squeezes the best prices out of its supplier. The video referred to Wal-Mart as the customer’s agent. All of this focus Wal-Mart puts on suppliers reduces costs and lowers prices. Wal-Mart’s technological/logistical leadership remains unmatched by competitors (Web, 2005).

Nowadays, Wal-Mart has become the largest retail company store in the world. It provides a wide range of quality products with everyday low prices. In the meantime, Wal-Mart also ensures consumers’ satisfaction and convenient online shopping experience. However, Wal-Mart still faces a lot of fierce competition from both domestic and international retail stores because the discount retail industry is experiencing constant

Wal-Mart Stores, Inc. strives to help people around the globe save money and live better. They earn the respect and trust of customers by providing a wide range of products and services at everyday low prices (EDLP), in which Walmart sets low prices on their items and holds them low without having promotional deal all the time. This strategy is ubiquitous in each of their three business segments: Walmart U.S., their largest segment, Walmart International, and Sam’s Club. Being the largest retailer in the world, Walmart has an unmatched potential to continue to dominate the retail industry. Having this large size allows them to take advantage of scale of operations as well as have a strong influence over their suppliers which inevitable effects their competitors, including but not limited to Costco, Carrefour, Target, Sears Holding, Tesco, Dollar General, Family Dollar, and Dollar Tree.

Though supplier power is high in the retail discounting industry, Wal*Mart changed the game with their two-step hub-and-spoke distribution network. Though building 1,000,000 square foot distribution centers seems costly, it allows Wal*Mart to purchase from their suppliers at a significantly reduced cost and deliver to their stores with 48 hours, sometimes even 24 hours. The network’s become so effective that 80% of their inventory comes directly from these 27 centers. In contrast, Kmart has only 50% of their products coming from distribution centers with a full half being shipped directly from suppliers into their stores, thus raising costs to Kmart and their customers. Systems such as “cross-docking” are also aiding Wal*Mart in their fight to streamline every process by reducing inventory and restocking costs.

Walmart has a large retail seafood business and it is always a challenge to reduce cost and promote sustainability. With upward trend for the demand of sea-food, depletion of the seafood supply is inevitable unless Walmart have a deep engagement of their supply chain. One strategy that Walmart wants to promote to their suppliers is for all of them to take up the Marine Stewardship Council’s certification program. This process will be time consuming, expensive and complex. The depletion of some fish poses a threat to Walmart and its seafood supply chain.

1. Wal-Mart has been able to achieve respectable leadership in the retail industry because of its focus on supply chain management. Discuss in detail the distribution and logistics system adopted by Wal-Mart.

In spite of these lucrative assurances, Wal-Mart is still faced with much uncertainty today. It constantly has to deal with adaptations to the consumer environment. Their main purpose is to serve the consumer, and as the needs of the consumer change, the need to change Wal-Mart’s setup will transform concurrently. With the ever-changing global environment, Wal-Mart will have to accomplish what no company has truly perfected in maintaining one of

In the digital era, innovation is the only way to success. Innovation in business means doing something different in a better and smatter way that will make a difference regarding quality, value or productivity by use of technology. Information technology has been the main thing that has been used in propelling the business to the next stage of innovation. Wal-Mart, the world largest retailer, was facing inventory management in all its branches leading to low- sales. From its inception, Wal-Mart has relied on the supply chain in contributing to its success. The company used fewer links in the supply chain as part of its innovation that will enhance its success in 1980. Before 2014, the company had engaged in previous attempts of incorporating technology in its activities since 2003. However, the technology was abandoned in 2009 as it did not solve any problem for the company. However, the same technology was incorporated into the business in 2014 which ensured that there were transparency and efficiency in supply chain leading to enormous success in the company.

and systematic integration with most of its suppliers which is a large part of Wal-Mart’s crucial low-cost advantage. The company generally requires suppliers to tie in to its own inventory management system and to deliver goods in the manner and timing Wal-Mart dictates, leading to impressive inventory turns (especially considering that half of revenue is from non-grocery categories) Furthermore, a no-frills store environment also improves total asset turns and limits maintenance capital investment. In addition, as a low-cost general retailer, Wal-Mart has built a reputation with consumers as a one-stop shop for good deals on a huge spectrum of merchandize. The company has been aggressively trying to further reduce stock-keeping units and lower prices. Most cost

The modern age has developed a technological, globalized and fast-pace world; necessity is expected while amenity became an oblivious prerequisite. Thus, began the era of hypercompetitive markets. The retail market, amongst others such as the smartphone and automobile markets, is one of the prominent markets that fall under the hypercompetitive definition. One of the most prominent households names that is associated with retail is an American multinational retail corporation, Wal-Mart Stores, Inc. (here after referred to as Wal-Mart). In this essay I am going to establish the extent of Wal-Mart’s success while identifying the strategic reasons behind that success. Illustrated by a detailed analysis of the organizations capabilities and leadership through analytical tools such as a Value Chain analysis followed by a detailed VRIN analysis of the company’s capabilities.