Here’s something to think about this Black Friday while you’re waiting in line in the cold at 4am, outside of Walmart, Best Buy, or Target: thank goodness for automated supply chain management systems! It wasn’t too many years ago that employees were doing inventory counts by hand and sending them to suppliers, leaving plenty of room for error, which could lead to either a shortage or overstock of a certain product. (I’d be pretty annoyed if I had gotten up at 3am to go get that flatscreen tv, only to discover someone had written down a wrong number, and not enough flatscreens were shipped to the store to satisfy the estimated Black Friday demand!)
However I don’t have to worry about that because thanks to automation, Wal-Mart’s supply chain acts as if every day is Black Friday! SupplyChainDigital explains in this article how Walmart’s supply chain is one of the most efficient ones out there because of IT solutions:
The technology is ridiculous across all areas of the Wal-Mart supply chain. Individual distribution centers, for example, have benefited from the development of sortation systems, radio-frequency picking, automated cranes and miniload systems. Industry standards have also helped Wal-Mart’s efficiency in the collaboration with its suppliers and vendors. Standardization includes things like pallet size and truck dimensions. Wal-Mart gets real-time updates from when a customer buys a product, to how long it will be before it can replace that same product on the shelves.
So this Friday morning, while you’re waking up early, driving to the store, searching for a parking spot and battling crowds to get that good deal on a flatscreen, you can take comfort in knowing that at least Walmart’s supply chain is completely under control.
Here’s a video I found that explains how Walmart plans to track supply chain emissions in order to provide carbon footprint information for all of their products. This follows up on a couple of blog posts I’ve made recently on this topic. Enjoy!
In last week’s post about greening the supply chain, I referenced an article that suggested starting with overseas suppliers (specifically those in China) to increase the supply chain’s energy efficiency. The article also discusses how Walmart has established a supplier energy efficient program in China, where the company has set a target of improving the energy efficiency of 200 factories by 20 percent over the next three years.
Today I found a bit more info on setting up a sustainability program such as Walmart’s. This article from Logistics Management explains that the benefits go beyond being good environmental citizens:
“Shoppers are looking for a good deal, but they also expect transparency,” she said. “They want to know that retailers are sensitive to global warming and other threats to future generations.”
Regina Edwards, director, supply chain compliance, for MeadWestvaco, concurred, stating that shippers were asking for “green” metrics placed on suppliers.
“Given the fact that we are so diversified and global, our leadership realized that we had to develop a principal code of conduct for suppliers that included more than just basic compliance,” she said.
It would not surprise me if, before long, going green becomes standard operating procedure, rather than something companies implement when they can.
At the CSCMP Annual Conference this year, the Journal of Commerce was able to pull aside Gary Maxwell, Logistics VP at Walmart, for a quick interview. In this video, Maxwell discusses the supply chain goals, expectations and challenges of Walmart, the world’s largest retailer. According to Maxwell one of the key driving forces of their supply chain are the customers. Walmart shoppers expect the stores to have high quality products at low prices, and without a well-managed, cost-efficient supply chain, this would be very difficult. Interesting insight into one of the world’s top 25 supply chains for 2009, as determined by AMR Research earlier this year. (See related post on the Supply Chain Top 25.)
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