PRESENTATION

ON
WAL–MART’S SUPPLY CHAIN MANAGEMENT PRACTICES
• World largest retailing company .

• Revenues of $219.81 million (2001-02) .

• Approx. 1,170 stores across the world.

• Employee strength approx. 1.28

million.

• Revenue of $378.799 million

(2008).
 WAL-MART has been able to
achieve respectable leadership in the
retail industry because of its focus on
supply chain management. Discuss
in detail the distribution & logistic
system adopted by Wal-Mart..
 DISTRIBUTION SYSTEM

• Procured goods directly from manufacturers.

• Establish long –term relationship with vendors.

• Barcode Technology.
 LOGISTICS
MANAGEMENT:-

• Distribution centers were serviced by more than 3500 company

owned trucks.

• Hired only experienced drivers.

• Drivers had to report their hours of service to a coordinator daily.

• Private Fleet Driver Handbook. In 2009, Walmart was named

Safest Fleet by the American Trucking Association

• Cross- Docking
How IT benefited Wal-Mart’s
Inventory & logistic
management
Information technologies benefit in
Inventory management:-
 Satellite communication system.
Expansion of Wal-mart stores in the US
Wal-mart set up its own SCS in 1983

 By using IT capabilities Wal-Mart check & make the availability of customers

demand.

 Automated Reordering System.

Entered into collaboration with P & G
Maintaining the inventories in its stores
ARS as a link b/w P&G and all computers, stores &
distribution channels
.
 Radio frequency system.
Proofs to be magic wand
Helps in keeping track of the inventory in stores

 Algorithm system to forecast exact quantities.

Centralized inventory data system
• Centralized Inventory data system.

• Bar Coding & fixed optical reader for efficient

picking, receiving & proper inventory control & for
physical counting of inventory.

• Internet enabled technologies.

Cont…
Information technologies benefit in logistic
management:-
• Accelerated Delivery system
 Various technologies made supply chain more convenient
 Irrespective of geographical area

• Cross –docking
 Make distribution process more efficient.
 Finished goods directly supplied to customers from manufacturing plant.
 Reduces handling & storage of finished goods.
 Eliminating the role of distribution centers &stores.
What were the supply chain management process
adopted by Wal-Mart and how far were they
effective?
Procurement and Distribution.
Procured Directly from manufacturers.
Generally, preferred local and regional vendor and
suppliers.
Use of barcode technology and hand held computer
system.

How it is effective?
Low price to customers.
Less cost effective.
Help supervisor to monitor their employees closely.
Help to satisfy customer need quickly.
Logistic Management:-

• Use more than 3,500 trucks

for transportation.
• Hire only experienced driver.
• Transfer from supply chain
to demand chain.
• Use five type of cross
docking.

How it is effective?
• Goods picked directly from
manufacturer.
• Reduce the handling and
storage charges.
Inventory Management
• Use of IT and Communication system.
• Setup own satellite communication.
• Collaboration with P&G.
• Use of algorithm system and bar-coding system.
• Tie-up with Atlas Commerce.
How it is effective?
• Help to communicate with stores.
• Help to reduce unproductive inventory.
• Help in Distribution of needed product.
• Help in accurate distribution of goods.
What was the nature of benefits derived by Wal-mart
from the efficient supply chain management practices
and how far it has contributed to its sustainable
competitive advantage?
• Low transportation cost(3% as compared to 5%)

• Reduction in lead time (within 48 hours)

• Wal-Mart can replenish the shelves four times

faster than its competitors

• Purchase huge quantities→ Good bargaining

power (price variation) →competitive price
(higher discounts) →benefit to consumers
Continue…..
• Accurate forecasting of inventory levels
• Increased warehouse space
• Reduction in safety stock
• Better working capital utilization
• Elimination of old stocks and maintained
quality of goods
Conclusion:-

By making effective use of computers in all

its company’s operation, Wal-Mart was
successful in providing uninterrupted
services to its customers, supplier, stock
holders and trading partners.
Thank you