Walmart Supply Chain

1018 Words Sep 20th, 2014 5 Pages
How should Wal-Mart rationalize its seafood supply chain to reduce costs and promote sustainability?

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.

Many challenges exists that will lead to indirect or direct increases in the cost
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However, to reduce cost and promote sustainability a deep engagement with every sector of the supply chain is needed. While Walmart can promote sustainability with the MSC certification program, as mentioned it is expensive and takes one year to complete. Therefore, Walmart can potentially establish their own quality control check. This will reduce cost while retaining sustainability of their supply chain. It will be cheaper and should take less than the MSC certification. Consumers are price sensitive. Therefore, it is important that Walmart retain reasonable prices for their fish. With such an internal program, it will be adventageous over the MSC certification because Walmart will be able to retain their affordable prices of their seafood while promoting sustainability.

Walmart can try to reduce the cost of the MSC certification. Boat operators and fishermen face direct and indirect cost for the certification. Therefore, Walmart can subsidize part of this cost of the certification to ensure that they can have a sustainable supply of certified fish.

These fishermen who are perhaps the first in line of the supply chain would know best how to promote sustainability and save these seafood from extinction. However, many of their may lack the expertise or capital to take these initatives. Walmart can have programs where they reward their suppliers who come up with innovative ideas to promote sustainability. These ideas should also be supported and funded by…