Report on Supply Chain Management of Wall Mart
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Added on 2020-04-07
Report on Supply Chain Management of Wall Mart
Added on 2020-04-07
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Running head: SUPPLY CHAIN MANAGEMENT 1SUPPLY CHAIN MANAGEMENTStudent NameInstitution
SUPPLY CHAIN MANAGEMENT 2Table of ContentsIntroduction...............................................................................................................................................3Overview of Wal-Mart..............................................................................................................................3Wal-Mart Supply Chain Management/Logistics....................................................................................4Procurement and Distribution..................................................................................................................4Logistics Management...............................................................................................................................5Figure 1: Cross-docking..........................................................................................................................6Inventory Management.............................................................................................................................7Modern Operations Management............................................................................................................8Sustainability throughout the value chain...............................................................................................9Figure 2: Opportunity Identification........................................................................................................9Figure 3: Table showing Wal-Mart Sustainability Index.......................................................................11References................................................................................................................................................13
SUPPLY CHAIN MANAGEMENT 3IntroductionSupply chain management is the regulation of information and finances as they move in aprocess from the supplier to the consumer. It involves coordination of these movements within and amongst companies. The main objective of a supply chain management is to reduce inventory. This technology has been embraced in today businesses to identify, get, share and predict events and transactions to translate into useful information to e used in management. Thisreport is based on Wall Mart. This will entail providing an overview of the business, Supply chain/logistics management from the source to the customers, the linkage between Wal-Mart activities and theories in the supply chain (Modern operations management) and explanation of sustainability throughout the chain.Overview of Wal-MartWal-Mart occupies the highest position in the world's largest retailer. In the fiscal year 2012, the company produced $446,950 million revenues (4-traders, 2017). Just like most large retail companies, Wal-Mart has both online and offline business. However, most of its revenues are generated from the five types of physical stores; discount store, Sam's club, supercenters, Wal-Mart Express and outlets like a neighborhood market. Started by Sam Walton, the company had its first store in Rogers, 1962. By 2012, it had developed to more than 10, 000 retail outlets in 27 countries (4-traders, 2017). Although various parameters can be used to measure and explain Wal-Mart's growth, its success is often attributed to efficient supply management initiatives (Seuring, 2013). For example, in 2012, a report compiled by the company showed thatits distribution cost was 1.7%of the cost of sales (4-traders, 2017). This figure is twice less of its competitors like K Mart and Sears. They have 3.5% and 5% cost of sales respectively.
SUPPLY CHAIN MANAGEMENT 4Wal-Mart Supply Chain Management/LogisticsAccording to Supply Chain Digest, Wal-Mart is a true definition logistical and operational triumph. It stocks products made in more than 70 countries. Moreover, it manages inventory worth $32 million and operates more than 11,000 stores at any time in 27countries (Gilmour, 2013).This shows how having an effective supply chain management strategy has been the backbone for Wal-Mart. Thus, this section provides the company's supply chain activities in three categories; procurement and distribution, logistics management and inventory management.Procurement and DistributionTo reduce purchasing cost and provide the best prices to customers, Wal-Mart directly procures goods from manufacturers thus bypassing all intermediaries. The company is known forbeing a good negotiator. It only decides to procure goods from a particular manufacturer when it is certain that no other manufacturer is offering the same product at a lower price (Ellram, 2013).In an interview, Claude Harris explained the reason Wal-Mart is tough on negotiating (4-traders, 2017). He said that when bargaining and negotiating, they always have the customer in mind. They know vendors have their limit but want the most out of negotiations (Ward, 2016). Therefore, they ensure that the negotiation result to the best customer prices.Wal-Mart uses EDI, computer software for procurement purposes. It connects the company's systems with suppliers'. This enables suppliers to access Wal-Mart purchase orders
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