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Founder(s) Sam Walton
Number of locations 11,088 (April 2014)
Revenue US$ 476.294 billion (2014)
Net income US$ 16.022 billion (2014)
Owner(s) Walton family
Employees 2.4 million (2014)
Asda, Sam's Club,Walmex, @WalmartLabs,
• VMI system
3 business segments:
• WalMart stores
o Super centers
o Discount centers
• SAM’S Club
• Hub and spoke
• Cross Docking
Logistic technique to
make the distribution
• Word of mouth
• Focuses on everyday
• “Save money, live
• Sales are on a self-service,
• Opening hours
close connection between headquarter and local stores.
• Based on Interaction practices between company and employees
• Low pay but other benefits (health care plans, retirement plans, or promotion opportunities)
• 2.2 million associates globally.
• Every time a supercenter is opened, roughly 300 jobs are been provided.
• Women - 57% of U.S. workforce, 27% of corporate officers, and 20% of Board of directors.
It is the key factor of the company. It constitutes a competitive advantage against competitors.
• Computer-based technology
o POS (Point of sales) system
o Satellite System
• Wal-Mart deals directly with manufacturers, by passing all intermediaries.
• EDI : Electronic data interchange
• MANUFACTURER – WALMART – CUSTOMER
• “Saturation Strategy”
• The company owns a
fleet of more than 3,000
trucks and 12,000
• The Wal-Mart
Way – Cross Docking.
EXTERNAL FACTORS INTERNAL FACTORS
SW • Diversity in products & services
• Convenient prices & locations
• Strong market presence
• Customer loyalty
• Strong financial performance
• Cost and pricing advantages over
• Good supply chain
• Global Expansion: new
• Increasing online sales
• Strategic alliances
- Acquiring rival firms
• Brand image-weak
• Low global presence
• Behind rivals in
• Intense Competition
• Laws and Regulations:
• Cultural barriers
• Current economy
• Slow market growth
• Transport of distinctive
SUPPLY CHAIN FLOW CHART
Point of sale terminal
Bar code, RFID
COMPONENTS OF SCM
• Logistics management
• Inventory management
• Wal-Mart emphasized the need to reduce purchasing
costs and offer the best price to the customer.
• The company directly procured from manufacturers,
by avoiding all intermediaries.
• Wal-Mart finalizes a purchase deal only when it is
fully confident that the products being bought is not
available else where at a lower price.
DISTRIBUTION USING VMI
• The vendor (supplier) manages the stock levels and availability for the customer based on
safety stock levels the as per the agreed Terms & Conditions.
• Vendor Managed Inventory (VMI) is a planning and management system in which the
vendor is responsible for maintaining the customer’s inventory levels.
• Manufacturers generate orders, not distributors or retailers Stocking information is accessed
• A first step towards supply chain collaboration
• Increased speed, reduced errors, and improved service
• An important feature of Wal-Mart’s logistics infrastructure was its fast and responsive
• The distribution centers were serviced by more than 7000 company owned trucks.
• Wal-Mart believed that it needed drivers who were committed and dedicated to
• The company hired only experienced drivers who had driven more than 300,000
accident-free miles, with no major traffic violation.
• Uses Cross-Doc and Hub & Spoke Approach
FLOW TIME ANALYSIS
for Inv. Mgmt.
is delivered to
based on historical
and real-time data
is shipped to
The store will re-stock
• Wal-Mart invested heavily in IT and communication systems to effectively track sales and
merchandise inventories in stores across the country. Hence, Wal-Mart set up its own satellite
communication system in 1983.
• Wal-Mart was able to reduce unproductive inventory by allowing stores to manage their own
stocks, reducing pack sizes across many product categories, and timely price markdowns.
• Employees at the stores had the “Magic Wand,” a hand-held computer which was linked to in-store
terminals through a radio frequency network. These helped them to keep track of the
inventory in stores, deliveries, and backup merchandise in stock at the distribution centers.
TO BE NOTED…
• One of the keys to Wal-Mart's effective logistical system is the flexibility that it has when choosing suppliers.
• When Wal-Mart negotiates with suppliers and the suppliers know that Wal-Mart will only pay the most
competitive prices. This is because it is very easy for them to find another supplier of that particular material
with a lower price and very few logistical problems
• Another reason that Wal-Mart's prices are so competitive is because they buy in such large quantities that
transportation from one end of the supply chain to another is not as costly for additional units.
• This aspect of the logistical system does not come from skill or expertise it simply comes from the sheer size
of the company, but this is still a factor.
TO BE NOTED…
• Wal-Mart buys so many supplies from different places throughout the world, that they have the
luxury of using bigger trucks and using less fuel to go back and forth.
• Also if by chance they have to use shipping services to transport material from one location to
another, Wal-Mart will give them so much business that they will get huge discounts.
• 2010 -Walmart created new unit Global.com to establish its online presence - E-commerce. The
major advantage that Walmart has over Amazon is the strong association of the e-commerce/
website with actual Walmart stores.
• Wal-Mart's online shopping sales grew 30 percent during
2013, but it is a small slice of the company's total profit.
• Wal-Mart announced a new line of organic food, to be sold
under the “Wild Oats” label, at prices comparable with
conventionally-grown products. This broad new line, with
more than 100 items, is sure to undercut existing price
points in the industry.
• The concept truck is called W.A.V.E. (Walmart Advanced
Vehicle Experience) and is said to be 20 percent more
aerodynamic than the company's current trucks