HISTORY OF WAL-MART
The company‟s founder is Sam Walton.
He was born in 1918 at Oklahoma.
In 1940, he worked for the famous
retailer, J C Penney.
Walton gave up the job and decided to set up
his own retail store.
He purchased a store franchise in Arkansas.
Offering significant discounts on prices, he
became successful and acquired a second
store in 3 years.
In 1980s, Wal-Mart continued to grow due to huge
customer demands in small towns.
Wal-Mart was offering low prices, customer
satisfaction guaranteed, and hours that were
realistic for the way people wanted to shop.
Open all night, for university students
By 1984, there were 640 Wal-Mart stores in
This phenomenal growth of Wal-Mart is
attributed to its continued focus on
customer needs and reducing cost through
efficient supply chain management
DEVELOPMENT OF SUPPLY CHAIN
Walton used to purchase Merchandise in Bulk
from new suppliers.
He realized that a new trend, discount retailing is
emerging. In order to compete he opened large
warehouse style stores termed as “WALMART
Improved Infrastructure and ability to react to
changes in legislation such as “resale price
maintenance” against rivals.
Making purchases in “Bulk”.
Largest suppliers had offices in
Bentonville thus supporting Wal-
International purchasing offices
worked with local factories sourcing
Wal-Mart’s private label products.
In the early 1970s, Wal-Mart became the
pioneer of the retail hub-and-spoke
Under the system, goods were centrally
ordered, assembled at a massive
warehouse, known as „distribution center‟
(hub), from where they were dispatched to
the individual stores (spoke).
To make its distribution process more
efficient, Wal-Mart also made use of a
logistics technique called “cross-docking”
In this system, the finished goods were
directly picked up from the manufacturing
plant, sorted out and then directly
supplied to the customers. The system
reduced the handling and storage of
finished goods, virtually eliminating the
role of the distribution centers and stores.
On the way back to stores, Wal-Marts
trucks generated “back-haul”
revenue by transporting unsold
merchandise on trucks that would be
Wal-Mart implemented an Every Day Low
Prices (EDLP) policy. As a result Wal-
Mart didn‟t need to advertise frequently.
RFID: Radio Frequency
Identification. (Inventory tracking
in supply chain)
VMI: Vendor Manage Inventory
CPRF: Collaborative Planning
Private Satellite Channel:
Normally in retail companies , HR is not
focused but Wal-Mart does.
Focus the HR aspect. Pays high value its
employees. They call do not them as
employees or workers. They term them
as “Associates”. They get them involved
and consider them part of Wal-Mart.
They call Saturday meetings, Weekly