Supply Chain Flow and Challenges
Walmart is known to have one of the most efficient and modern supply chains in the world. This is not only due to Walmarts trucking fleet, which is the biggest privately owned truck fleet in the world, but also due to the exceptionally modern information and forecasting systems. Due to the fact, that Walmart is known to be the largest retailer in the world, they are also dealing with a lot of suppliers. As Walmart is working together with more than 90.000 suppliers, efficient supply chain operations are crucial.
In order to give an overview for Walmart’s supply chain, the supply chain flow of the company is described in the following.
The supply chain flow starts with picking up ordered merchandise from …show more content…
When the merchandise arrives at the store it is directly unloaded and put into the shelves, as Walmart tries to keep inventory levels as low as possible. Thus, inventory costs are relatively low, allowing the company to charge the already mentioned “everyday low prices”, giving it a huge competitive advantage over the other competitors. Moreover, when the trucks are unloaded they are directly loaded up again with unsold merchandise, which is then transported back to the distribution centre. This creates additional, so known, backhaul revenue. But not only the private truck fleet plays an essential role within Walmart’s supply chain. As it was mentioned before, the information and forecasting system, embedded in the advanced technology Walmart possesses, is of major importance, too. Information is frequently and precisely gathered with the help of universal bar codes. As Walmart was one of the first companies to introduce companywide universal bar codes, information about company wide demand levels has been gathered over long periods of time. This means, when an item is bought and the barcode was scanned, the information is directly passed on to the Real link database. It is …show more content…
The company´s centralized headquarters not only contribute to improved communication between the different departments, but also enable Walmart to have a clear overview and control over its supply chain. Walmart´s highly efficient supply chain is also due to its independent way of operating. As part of its supply chain strategy, Walmart cut out the middleman (wholesalers and distributors). Additionally it possesses the biggest privately own trucking fleet in the world and the most advancing information and forecasting systems. Since Walmart buys products in huge bulks and due to its reputation of being the largest retailer in the world, Walmart can maintain its bargaining power over suppliers. In conclusion, the supply chain of Walmart is operating highly efficient. However, there are improvements to be made in the in-house logistics at the retail centres, in order to avoid empty shelves. This might be done by hiring more staff or offering extra training. We believe that, Walmart’s predicted revenues are going to increase again when the suggested improvements are undertaken, as customers will be won back from the other
Walmart is known to have one of the most efficient and modern supply chains in the world. This is not only due to Walmarts trucking fleet, which is the biggest privately owned truck fleet in the world, but also due to the exceptionally modern information and forecasting systems. Due to the fact, that Walmart is known to be the largest retailer in the world, they are also dealing with a lot of suppliers. As Walmart is working together with more than 90.000 suppliers, efficient supply chain operations are crucial.
In order to give an overview for Walmart’s supply chain, the supply chain flow of the company is described in the following.
The supply chain flow starts with picking up ordered merchandise from …show more content…
When the merchandise arrives at the store it is directly unloaded and put into the shelves, as Walmart tries to keep inventory levels as low as possible. Thus, inventory costs are relatively low, allowing the company to charge the already mentioned “everyday low prices”, giving it a huge competitive advantage over the other competitors. Moreover, when the trucks are unloaded they are directly loaded up again with unsold merchandise, which is then transported back to the distribution centre. This creates additional, so known, backhaul revenue. But not only the private truck fleet plays an essential role within Walmart’s supply chain. As it was mentioned before, the information and forecasting system, embedded in the advanced technology Walmart possesses, is of major importance, too. Information is frequently and precisely gathered with the help of universal bar codes. As Walmart was one of the first companies to introduce companywide universal bar codes, information about company wide demand levels has been gathered over long periods of time. This means, when an item is bought and the barcode was scanned, the information is directly passed on to the Real link database. It is …show more content…
The company´s centralized headquarters not only contribute to improved communication between the different departments, but also enable Walmart to have a clear overview and control over its supply chain. Walmart´s highly efficient supply chain is also due to its independent way of operating. As part of its supply chain strategy, Walmart cut out the middleman (wholesalers and distributors). Additionally it possesses the biggest privately own trucking fleet in the world and the most advancing information and forecasting systems. Since Walmart buys products in huge bulks and due to its reputation of being the largest retailer in the world, Walmart can maintain its bargaining power over suppliers. In conclusion, the supply chain of Walmart is operating highly efficient. However, there are improvements to be made in the in-house logistics at the retail centres, in order to avoid empty shelves. This might be done by hiring more staff or offering extra training. We believe that, Walmart’s predicted revenues are going to increase again when the suggested improvements are undertaken, as customers will be won back from the other