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Wegmans Case Study

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Wegmans is a regional supermarket chain with 95 stores: 46 in New York, 17 in Pennsylvania, 9 in New Jersey, 10 in Virginia, 8 in Maryland, and 5 in Massachusetts. It is one of the largest private companies in the U.S. It is a family-owned company, founded in 1916, headquartered in Rochester, NY. Danny Wegman is chairman; Colleen Wegman, his daughter, is president and CEO. Danny’s daughter Nicole Wegman is sr. vice president. Robert Wegman, Danny’s father, was chairman until his death in April 2006. Wegmans established data synchronization with local and national suppliers in 2006. This synchronization improved supply chain efficiency, which saved $1 million in labor and inventory costs and led to a 7% increase in productivity from store delivery process improvements. Suppliers also saw direct improvements, including 75% reduction in speed-to-shelf for new items and a decrease in inspection time by five minutes per order. These time reductions dampen the bullwhip effect between Wegmans and its suppliers, which helps ensure low prices. It also encourages new suppliers to work with Wegmans, which increases product. Wegmans has a mostly vertically-integrated supply chain that allows it to control the distribution process. It owns warehouses instead of outsourcing distribution and sources some food from its 50-acre organic farms. Wegmans is able to manage this unique operating model because it restricts its footprint to only six states. Wegmans ensures that its employees are
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