Name: Malik Muwadat Hussain

Roll number: 23110264

WALMART EFFICIENT SUPPLY CHAIN

Walmart, the retail giant, clearly follows the pattern of an efficient supply chain. Their
competitive strategy revolves around cost reduction to achieve everyday low prices. Let's
discuss the key features of Walmart's efficient supply chain in detail:
1. Walmart wanted to be a "house of brands," and to achieve this purpose, they needed
an exceptional procurement strategy. They maintained control over their suppliers
in a way that they were able to dictate payment agreements which help them in cost
minimization. 
2. Walmart followed a "hub-and-spoke" design for its distribution strategy. They were
able to position their distribution centres around their retail stores to maintain an
effective distribution. The average distance between stores and the distribution centre
was 130 miles, which helped them distribute perishable items. It eventually helped
them achieve cross-docking to avoid storage costs. Moreover, positioning stores near
distribution centres enabled Walmart to achieve a stunning revenue of 1 billion US$
through backhaul revenues, and it also helped them in inventory management. 
3. For their pricing strategy, they rely on EDLP every day low prices instead of
variable pricing to increase its aggregate gross profit. Walmart attempts to increase its
customer footfall by offering lower prices on products and maximizing the volume of
items sold. 
4. One of the critical features in Walmart's efficient supply chain was its information
system. The use of UPC bars and store level point-of-sale systems allowed them to
better manage their inventory levels. Forecasting sales patterns based on consumer
data with the help of Retail Link & CPRF (collaborative planning, forecasting, and
replenishment) helped them to keep track of individual stock items both at the retail
and supplier level. 
5. For their supplier strategy, they exert control over their suppliers and induce
competition between suppliers for shelf space. For instance, introducing category
captains helped Walmart increase its shelf space revenue. Moreover, Walmart also
focused on its private labelled products from global suppliers to earn higher margins
 than branded products. Walmart shares real-time sales data with its suppliers on a
regular basis to avoid inventory stockouts. Walmart worked with more than 200
suppliers, and it deals directly with manufacturers avoiding any supply-chain
middleman in its way which helped to reduce costs further. 
6. For their inventory management, they focused on vendor managed inventory (VMI)
which not only helped them in keeping inventory levels up to the mark but also in
increasing backhaul revenues and avoiding bullwhip effect. 
7. Walmart is more inclined towards the push model because of the demand uncertainty
involved in case of functional products. This model helped Walmart to leverage the
historical store data to make accurate forecasts. 
8. Moving forward, Walmart is focused on its multichannel strategy in which they
want to use their retail network to boost their e-commerce sales. They provide unique
shipping options to their consumer base by using their 8500 stores in 15 different
countries.
9. Lastly, they are reorganizing their logistics under the umbrella of their Project One
Touch, through which they're able to reduce their costs significantly.