Business Analysis Of Wal-Mart's Supply Chain Management

Wal-Mart was able to succeed a respectable leadership in the retail industry because of its focus on the supply chain management, which is the active management of activities that will increase customer value and will gain a supportable competitive advantage, it focuses on the effort of the firm to create and produce a chain that is effective and efficient. The activities that the supply chain creates focuses on the product such as the development, tracking, production and the logistics ("What Is Supply," 2017). The distribution system that Wal-Mart adopted was that they always got the goods directly from the manufacturers, they avoided going to suppliers to get the goods. They were also good at negotiating good prices and made sure no
The third distribution system was that Wal-Mart used a high-tech barcode technology and hand held computer systems that helped manage that distribution center in an simpler and economical way by ensuring that the center had a stable and reliable flow of product to help the supply function. By having this technology it allows all the employees at Wal-Mart to have access to real time information if needed by just scanning the barcode, each item has a different barcode label. Whereas the hand held devices help employees navigate the products by locating its shelf or bin, the device also helps the packaging department to get precise information about the packaged products because it gives them information about the storage, packaging and shipping of any particular product. The logistic systems that Wal-Mart adopted was having a very fast and responsive transport system, they company owned more than 3,500 trucks, by owning this much trucks it allowed products to be distributed from the distribution center to the Wal-Mart stores within 2 days and the shelves get restock twice a
There transportation cost is 3% whereas their competitor is 5%. Wal-Mart can restock the stores shelves faster than their competitors by four times. By purchasing large amounts of goods benefits Wal-Mart and directly purchasing it from the manufacturers enables them to price the goods economically and make them offer high amount of discounts compared to other retailers which benefits Wal-Mart by increasing there revenue. They also reduce the lead-time, which is 48 hours; also they had an accurate forecasting of inventory because of the amount of money they invested in the technology systems, which they benefited a lot from. They also increased warehouse spaces because of the cross docking because goods and products where sent directly to the customers without going to the distribution center. The cross docking also help Wal-Mart to decrease storage cost and also lessening the number of workers or labors needed in the organizing of good. The invested in technologies such as the Bar coding and the radio frequency that help them distribute good in an accurate and efficient manner because they kept track of them to make sure they the reached the right place. Wal-Mart invested a lot of money in information technology,