Walmart Inventory Strategy Analysis

Inventory Strategy Analysis

The current strategies/tools used by Walmart:

1. Using satellite establishment of a global information exchange system.

In 1987, Wal-Mart founder Sam Walton spending billions of dollars, have spent huge amounts of money for the lease of satellite companies to establish the nation 's largest private satellite communication system, in order to save communication between headquarters and branch offices costs, speed up decision-making and speed information to convey feedback to improve the operational efficiency of the entire company. High-speed computer connections to the headquarters of 16 delivery centers and more than 1,000 stores. Through the store checkout laser scanners sold every piece of goods, will be automatically

First of all, it is a supplier qualification. From the supplier 's production scale, financial strength, technical conditions, product quality, credit status, payment requests, timely delivery and other aspects of a comprehensive study, initially identified the target vendor selection. Secondly, procurement negotiations. In the process of procurement negotiations, to take the standardization of business negotiation procedures. First, the venue for negotiations unification. Negotiating with suppliers to select Wal-Mart locations will be room to negotiate, on the one hand as the main battlefield of the negotiations, it is advantageous to negotiate on the company; the other hand, high transparency of the negotiations, to avoid the risk of business negotiations, to prevent opportunistic behavior salesman. Second, the negotiations standardization. "Product Procurement negotiation format," according to the company requirements to negotiate. For example, product attributes, product quality, packaging requirements, purchase quantity, batch, delivery time and place, price discounts, payment requests, return the way, the number of return, return cost-sharing, with the product promotion, promotion of cost-sharing and other related content. Again, it is the implementation of a strategic partner type of operation mode of supplier management, that is, the supplier 's production costs, R & D, management fees into Wal-Mart 's management system in the past. Through computer databases to Wal-Mart all the stores inventory information, sales information, price information, customer feedback, internal business plan information with suppliers to share, thereby reducing the transaction costs of external markets, through timely market feedback, ensuring product quality and innovation speed. Wal-Mart, the symbiosis between the provider is very important. Such symbiotic include: full