wal mart SCM case

QU N LÝ CHU I CUNG NG C A WAL-MART GI I THI U Cơng ty Wal-Mart có tr s t i M c x p h ng cao nh t danh sách c a Fortune 500 n m tài 2001-02 i thu nh p $219.81 billion ( ng I) Wal-Mart công ty bán l l n nh t th gi i Công ty l n h n r t nhi u so v i i th c nh tranh M – Sears Roebuck, K-Mart, JC Penney Nordstrom t h p l i (Exhibit I) Trong n m 2002, Wal-Mart v n hành nhi u h n 3,500 a hàng gi m giá, Sam’s Clubs Supercenters i M nh u h n 1,170 a hàng t i nhi u n c l n th gi i Công ty ng th i c ng bán hàng qua m ng thông qua trang web a công ty walmart.com NG I DANH SÁCH FORTUNE 500 (2002) p ng Công ty Thu nh p (theo $ millions) Wal-Mart Stores Exxon Mobil General Motors Ford Motor Enron 219,812.0 191,581.0 177,260.0 162,412.0 138,718.0 Source: www.fortune.com Wal-Mart m t nh ng công ty t nhân l n nh t th g i, v i s l ng nhân công kho ng 1.28 tri u Ng i sáng l p công ty, Sam Walton (Walton) t p trung vào nâng cao hi u qu bán hàng, liên t c gi m chi phí, tri n khai h th ng phân ph i qu n lý logistics hi u qu s ng công c tiên ti n v công ngh thông tin Theo nhà phân tích, Wal-Mart có kh n ng t c v trí d n u (Exhibit II) ngành công nghi p bán l cho hi u qu c a chu i cung ng c a công ty Captain Vernon L Beatty, aide-de-camp to the commander, Defense Supply Center, Columbus, Ohio nói, “Qu n lý chu i cung ng chuy n úng hàng n úng khách hàng, t i úng th i m v i ph ng ti n hi u qu nh t Khơng có th làm t t h n Wal-Mart.” This case was written by P Mohan Chandran, under the direction of Vivek Gupta, ICFAI Center for Management Research (ICMR) CÁC THÔNG TIN H U TR NG Walton was born in 1918 at Kingfisher, Oklahoma, US After graduating from the University of Missouri in 1940, Walton worked for the famous retailer, J C Penney In his first job, Walton had displayed the qualities of a good salesman He realized the importance of building loyalty among customers as well as employees In the mid 1940s, Walton gave up his job and decided to set up his own retail store He purchased a store franchise from Ben Franklin in Newport, Arkansas It was here that he learnt his first lessons in retailing – offering significant discounts on product prices to expand volumes and increase overall profits The business was successful and Walton soon acquired a second store within three years Walton not only looked for opportunities to open stores in other small towns but also explored the possibility of introducing innovative practices such as self-service As the need for people to manage his stores increased, Walton tried to attract talented and experienced people from other stores By 1969, Walton had established 18 Wal-Mart stores, reporting an annual sale of $44 million In mid 1970s, Wal-Mart acquired 16 Mohr-Value stores in Michigan and Illinois By the late 1970s, the retail chain had established a pharmacy, an auto service center, and several jewellery divisions In the 1980s, Wal-Mart continued to grow rapidly due to the huge customer demand in small towns, where most of its stores were located Commenting on the growth of Wal-Mart, Walton said: “When we arrived in these small towns offering low prices every day, customer satisfaction guaranteed, and hours that were realistic for the way people wanted to shop, we passed right by that old variety store competition, with its 45 percent mark ups, limited selection and limited hours.” Wal-Mart stores were located at a convenient place in a big warehouse-type building and targeted customers who bought merchandise in bulk Customers could buy goods at wholesale prices by becoming members and paying a nominal membership fee By 1984, there were 640 Wal-Mart stores in the US, generating sales of about $4.5 bn and accruing profit of over $200 mn Wal-Mart suffered a setback in 1992, when Walton died after a prolonged illness But it continued its impressive growth in the 1990s, focusing more on establishing its stores overseas In 1992, Wal-Mart expanded its operations in Mexico by entering into a joint venture with Cifra Two years later, the company acquired 122 Woolco stores from Woolworth, Canada By 1997, Wal-Mart had become the largest volume discount retailer in Canada and Mexico In 1997, Wal-Mart acquired the 21-store German hypermarket chain, Wertkauf Other international expansion efforts included the purchase of Brazilian retailer Lojas Americans’ 40 percent interest in their joint venture, and the acquisition of four stores and additional sites in South Korea from Korea Makro In January 1999, Wal-Mart expanded its German operations by buying 74 stores of the hypermarket chain, Interspar The stores were acquired from Spar Handels AG, which owned multiple retail formats and wholesale operations throughout Germany By 2002, Wal-Mart had emerged as the largest company in the world in terms of revenues Analysts felt that Wal-Mart had come a long way since 1979, when the company generated annual revenues of more than a billion dollar for the first time By 1993, the company was doing a billion dollar business in a week and by 2001, it was crossing the billion dollar mark in every 1.5 days Analysts attributed this phenomenal growth to Wal-Mart’s continued focus on customer needs and reducing costs through efficient supply chain management practices Cơng ty có kh n ng cung c p t s l ng l n s n ph m v i chi phí th p th i gian ng n nh t có th Vi c ch y u hai y u t – Kh n ng c a trung phân ph i t ng c a Wal-Mart, giúp gi m chi phí th i gian chuy n hàng, h th ng qu n lý d tr b ng máy tính, giúp t ng kh n ng t ng c trình “check out” ghi l i giao d ch u QU N LÝ CHU I CUNG NG MUA HÀNG VÀ PHÂN PH I Wal-Mart luôn nh n vào m c tiêu gi m chi phí mua hàng mang n cho khách hàng m c giá t t nh t Công ty mua hàng tr c ti p t nhà s n xu t, không thông qua trung gian Wal-Mart m t công ty àm phán c ng v giá ch hoàn thi n m t h p ng mua tin t ng hoàn toàn ng s n ph m c mua khơng có n i khác v i giá th p Theo Claude Harris, t nh ng nhân viên s m nh t, “ i ng i mua u ph i c ng r n ó cơng vi c Tơi ln nói v i nh ng ng i mua: ‘ n àm phán cho khách hàng c a b n Và khách hàng c a b n x ng có c giá t t nh t kh n ng c a b n ng bao gi ti c cho m t nhà cung c p H bi t có th bán gì, ta mu n giá t t nh t c a ‘Chúng ta có th nói v i nhà cung c p,’ ng ch cho ây b i chúng tơi khơng làm vi c ó ây Và chúng tơi khơng mu n ch ng trình qu n cáo phân ph i c a anh Các xe t i c a s l y hàng t i kho c a công ty b n Bây gi giá th p nh t c a b n bao nhiêu?” Wal-Mart d ng r t nhi u th i gian g p nhà cung c p hi u c u trúc giá c a h B ng cách làm cho trình su t, nhà bán l có th ch c ch n nhà s n xu t làm h t kh n ng ah gi m chi phí Khi ã tho mãn, Wal-Mart tin t ng thi t l p m i quan h dài h n v i nhà cung c p Trong n l c m c c , Wal-Mart th m chí khơng quan tâm n c nhà cung c p l n nh Procter & Gamble (P&G) Tuy nhiên, cơng ty nói chung, mong mu n có nhà cung c p a ph ng khu v c Trong n m 1998, Wal-Mart có 40 trung tâm phân ph i t i v trí a lý khác M Trên 80,000 mã hàng c l u kho c a trung tâm Wal-Mart s h u nhà kho cung c p tr c ti p 85% tr , so v i 50-65% c a i th Theo m t c tính s b , Wal-Mart có kh n ng b sung hàng vòng ngày (trung bình) so v i t i thi u ngày c a i th nh tranh Chi phí v n t i c a Wal-Mart chi m kho ng 3% so v i 5% c a i th c nh tranh i trung tâm phân ph i c chia thành vùng khác c s s l ng hàng nh n c qu n lý nh cho c cases hàng pallet T c quay vòng d tr r t cao, kho ng m t n tu n cho ph n l n s n ph m Hàng hoá bên n c M th ng c x p pallet hàng nh p kh u th ng n d ng h p cases có th tái s d ng Trong m t vài tình hu ng, nhà cung c p phân ph i hàng nh xe ôtô hay s n ph m thu c tr c ti p n a hàng Kho ng 85% lo i hàng có c a hàng i qua trung tâm phân ph i Trung tâm phân ph i m b o dòng s n ph m u h tr ch c n ng cung c p Do Wal-Mart s d ng công ngh barcode ph c t p h th ng máy tính c m tay, vi c qu n lý trung tâm tr nên d dàng kinh t h n M i nhân viên có th truy c p thông tin th c v c d tr c a t t c s n ph m trung tâm H ch c n quét l n – t xác nh pallet m t xác nh v trí mà d tr s c l y Các barcodes khác c s d ng dán nhãn n ph m khác nhau, giá hàng ng n hàng trung tâm Máy tính c m tay ng d n nhân viên v v trí c a m t s n ph m c th t i m t v trí ng n ho c giá c th Khi máy tính xác nh n l i ng n l y s n ph m l y s n ph m, nhân viên xác nh n úng lo i s n ph m hay không S l ng s n ph m yêu c u t trung tâm c a vào thi t b c m tay b i nhân viên máy c p nh t thôn g tin v máy ch Máy tính c m tay c ng cho phép b ph n óng gói có thơng tin xác v lo i s n ph m c óng gói Nó hi nt th thơng tin v ch hàng, óng gói yêu c u chuy n c a s n ph mc th , ti t ki m nhi u th i gian gi y t Nó c ng cho phép giám sát trung tâm theo sát nhân viên cho phép h d n h ng th m chí h ng d n t ng b c di chuy n Vi c cho phép công ty tho mãn nhu c u khách hàng nhanh chóng cài ti n hi u qu c u ho t ng qu n lý trung tâm phân ph i i trung tâm phân ph i có thi t b trì n ng l ng cá nhân nh nhà t m trung tâm th hình Nó c ng cung c p n, ch ng nhu c u cá nhân khác Trung tâm phân phói ng có th dùng g p g x lý gi y t Các lái xe c a Wal-Mart thính tho ng c ng s d ng d ch v QU N LÝ LOGISTICS t c m quan tr ng c a c s h t ng logistics c a Wal-Mart h th ng v n t i nhanh ph n ng nhanh c a Wal-Mart Các trung tâm phân ph i ph c v b i 3,500 công ty xe t i Các thi t b xe t i chuyên d ng cho phép công ty chuy n hàng t trung tâm phân ph i t i c a hàng ngày b sung hàng giá c a c a hàng l n m t tu n i xe t i liên k t hi n u c a c a hàng v i trung tâm phân ph i Wal-Mart tin r ng h c n lái xe có cam k t g ng ph c v khách hàng Cơng ty ch th lái xe có kinh nghi m ã lái 300,000 miles khơng có tai n n, khơng có vi ph m lu t giao thông l n Các lái xe c a Wal-Mart th ng chuy n hàng hoá xe l n t trung tâm phân ph i c a Wal-Mart t í c a hàng bán l c ph c v b i trung tâm phân ph i ó Các c a hàng bán l c xem khách hàng c a trung tâm phân ph i Các lái xe ph i báo cáo gi ph c v c a v i ng i u ph i hàng ngày Ng i u ph i lên l ch v n chuy n tu thu c vào th i gian lái xe ang có th i gian c tính v n chuy n gi a trung tâm phân ph i c a hàng bán l Ng i u ph i thông báo cho lái xe nhi m v , h n ho c tr v trung tâm phân ph i t a hàng bán l Lái xe th ng c trông i mang xe y t i t trung tâm phân ph i t i c a hàng tr v v i m t xe r ng Anh ta c n u ph i m t xe y t i t i c a hàng bán l , u êm ó M t lái xe c n mang xe t i c a nh n c a c a hàng ch t i th i m x p hàng c a nó., khơng ph thu c vào vi c n vào lúc Các lái xe chuy n hàng vào bu i chi u t i h s chuy n hàng xu ng xe vào ban êm Có kho ng th i gian gi gi a l n chuy n hàng xu ng c a xe Ví v , u c a hàng nh n c xe, xe u s xu ng t i lúc (12 AM), chi c th hai lúc AM chi c th ba luc AM c dù, xe c m t ch , chúng c b o v b i lái xe cho n ng i c a c a hàng th c hi n nhi m v vào bu i t i Wal-Mart nh n nhi u xe h n s c a xu ng t i h có, l ng hàng kinh doanh r t l n Wal-Mart trì s ki m sốt ch t ch lái xe thông qua vi c ghi ho t ng c a h vào “Private Fleet Driver Handbook” (Exhibit III) M c ích c a cu n s giáo d c lái xe theo tiêu chu n c a cơng ty Nó c ng bao g m u kho n u ki n liên quan én an toàn xe i nhân viên c a hàng an toàn tài s n c a Wal-Mart Cu n s c ng bao g m m t danh sách hành ng, không tuân th theo s d n t i vi c b ch m d t h p ng làm cho trung tâm phân ph i hi u qu h n, Wal-Mart s d ng m t k thu t logistics ‘cross-docking’ V i h th ng này, s n ph m cu i c l y tr c ti p t nhà s n xu t hay cung c p s p x p chuy n tr c ti p cho khách hàng H th ng gi m chi phí handling c t gi accs s n ph m cu i, g n nh ã lo i b vai trò c a trung tâm phân ph i c a hàng Có lo i cross-docking (Exhibit IV) i cross docking, yêu c u mua nh n hàng hoá t m t c a hàng s c chuy n thành n hàng mua Các n hàng mua c chuy n t i nhà s n xu t có ho c khơng có kh n ng cung c p hàng hố m t kho ng th i gian nh t nh Trong tr ng h p nhà s n xu t ng ý cung c p hàng kho ng th i gian xác nh, hàng c chuy n tr c ti p t i vùng c g i khu c t m “staging area” Hàng hố c óng gói t i ây theo th t nh n t c a hàng khác sau ó c g i t i cho khách hàng t c hi u qu l n nh t v i cross-docking, Wal-Mart ã th c hi n thay i c b n cách ti p c n v ki m soát qu n lý Thông th ng, quy t nh mua hàng, giá khuy n m i c t p trung th ng c th c hi n b i m c qu n lý công ty (corporate level) H th ng cross-docking, nhiên, thay i th c t H th ng chuy n s t p trung t “chu i cung ng -supply chain” sang “chu i nhu c u -demand chain”, có ngh a thay nhà bán l “ y” hàng qua th ng; khách hàng có th “kéo” s n ph m, n i h c n Cách ti p c n tahy i ph ng th c, t n su t, cách h p tác không truy n th ng c a c a hàng, trung tâm phân ph i nhà cung c p v i ki m sốt t p trung h n tr c ây QU N LÝ D TR Wal-Mart ã phát tri n kh n ng cung c p cho t ng nhu c u riêng bi t t i c a hàng c a hàng có th l a ch n m t s k ho ch giao hàng Ví d , có h th ng giao hàng nhanh cho c a hàng g n trung tâm có th c b sung hàng m t ngày Wal-Mart u t nhi u vào IT h th ng thông tin giám sát hi u qu hàng bán d tr `hàng hoá c a hàng toàn qu c V i s m r ng nhanh c a c a hàng Wal-Mart i M , r t n thi t ph i có h th ng thơng tin t t Do ó, Wal-Mart ã có riêng h th ng thơng tin v tinh vào m 1983 Gi i thích l i ích c a h th ng Walton nói, “Tơi có th i phịng v tinh, t i ó thu t viên ng i tr c máy tính, nói chuy n n tho i v i b t c c a hàng có v n v ih th ng, ch c n nhìn qua vai h m t ho c hai phút s bi t nhi u v công vi c th c hi n nag hôm Trên hình, tơi nhìn th y l ng ti n hàng b sung chúng xu t hi n N u chúng tơi có vi c quan tr ng hay kh n c p c n trao i v i c a hàng hay trung tâm phân ph i, Tôi, hay b t c ng i u hành Wal-Mart có th vào TV studio c a chunhs Truy n thông tin tinh k t n i Wal-Mart có kh n ng gi m d tr không c n thi t b ng cách cho phép c a hàng t qu n lý c d tr c a h , gi m c óng gói c a nhi u dòng s n ph m, gi m giá theo th i gian Thay gi m d tr toàn b , Wal-Mart s d ng toàn b kh n ng c a h th ng IT t ng d tr c a t hàng khách hàng mua nhi u nh t gi m m c d tr nói chung Wal-Mart c ng k t n i nhà cung c p c a h qua h th ng máy tính Cơng ty h p tác v i P&G trì d tr a hàng xay d ng m t h th ng ng t hàng l i, liên k t t t c máy tính c a P&G c a hàng trung tâm phân ph i c a h H th ng máy tính t i c a hàng Wal-Mart xác nh s n ph m có d tr th p g i tín hi u n cho cho P&G H th ng g i n hàng b sung t i nhà máy g n nh t c aP&G qua h th ng thơng tin v tinh P&G sau ó phân ph i hàng t trung tâm phân ph i c a Wal-Mart ho c tr c ti p t i c a hàng liên quan S h p tác gi a Wal-Mart P&G quan h win-win cho c hai bên b i Wal-Mart có th giám sát m c d tr t i c a hàng liên t c c ng có th xác nh m t hàng bán nhanh P&G c ng có th gi m chi phí chuy n m t ph n ti t ki m cho Wal-Mart s h p tác hi u qu Nhân viên t i c a hàng có ‘Magic Wand’, m t máy tính c m tay k t n i v i thi t b u cu i thông qua m ng Radio Vi c giúp h theo dõi d tr c a hàng, giao hàng hàng hoá backup kho c a trung tâm phân ph i th ng qu n lý n hàng b sung hàng c th c hi n v i s tr giúp c a máy tính thơng qua th ng Point-of-Sales (POS) Thơng qua th ng này, có th theo dõi giám sát bán hàng m c d tr các lo i hàng giá Wal-Mart c ng s d ng h th ng thu t tốn ti n ti n cho phép cơng ty d báo xác s ng m i lo i hàng c giao, d a m c d tr t i c a hàng Do d li u xác, th m chí lo i hàng theo lơ có th c tách cung c p cho c a hàng Wal-Mart c ng s d ng th ng d li u d tr t p trung, v i h th ng nhân viên t i c a hàng cso th tìm th y m c tr v trí c a m i lo i hàng t i b t c th i m Nó c ng ch m t s n ph m c a vào m t trung tâm phân ph i ho c ang c chuy n xe Khi hàng c xu ng t i c a hàng, c a hàng v i y d tr s n ph m h th ng d li u d tr c c p nh t l p t c Wal-Mart c ng s d ng k thu t mã v ch t n s radio qu n lý d tr S d ng mã v ch b c quang c nh, hàng có th c chuy n n úng c a, t ó chúng c chuy n lên xe chuy n i Các thi t b mã v ch giúp nâng hi u qu l y hàng, nh n ki m soát d tr c a lo i hàng Nó c ng cho phép óng hàng m hàng kho d n dàng h n m 1991, Wal-Mart ã u t kho ng $4 xây d ng h th ng k t n i bán l “retail link system” H n 10,000 nhà cung c p c a Wal-Mart d ng h th ng giám sát m c bán hàng a lo i hàng kho b sung d tr Các chi ti t c a giao d ch hàng ngày, x p x h n $10 tri u hàng ngày, c x lý thơng qua h th ng tích h p c g i n t t c c a hàng Wal-Mart lúc a.m., ngày hôm sau Tháng 10 n m 2001, Wal-Mart liên k t v i Atlas Commerce nâng c p h th ng thông qua công ngh Internet Wal-Mart s h u h th ng máy tính l n nh t ph c t p nh t công ty t nhân Công ty d ng th ng máy tính Massively Parallel Processor (MPP) giám sát s v n chuy n c a hàng hoá m c d tr T t c thông tin liên quan t i d tr c chuy n qua h th ng thông tin v tinh cung c p back-up tr ng h p s p h th ng ho c ng t qng d ch v , cơng ty có m t k ho ch x lý ng cách s d ng máy tính hi u qu t t c ho t ng c a công ty, Wal-Mart ã thành công vi c cung c p d ch v liên t c cho khách hàng, nhà cung c p, c ông b n hàng kinh doanh CÁC L I ÍCH THU C Wal-Mart tin t ng nh n m nh vi c t ng c ng quan h v i khách hàng, nhà cung c p, v i nhân viên Công ty r t th n tr ng ý th c v thay i nh v m t b ng kho thu t c i thi n hi u qu nâng cao giá tr khách hàng Công ty ã n l c thu v m i h i tiét ki m Ti t ki m v chi phí ln c chuy n cho khách hàng, b ng cách ó t o giá tr gia t ng t i m i gia n c a trình Wal-Mart c ng nh n c l i ích t chi phí v n t i th p công ty s h u h th ng v n t i có th a hàng t i c a hàng khác vòng (nhi u tr ng h p th p h n) 48 gi Chi phí v n i c a Wal-Mart c tính kho ng 3% ng chi phí so v i 5% a i th c nh tranh S h u h th ng v n t i cho phép Wal-Mart b sung hàng giá l n nhanh h n i th Giá hàng hố c a Wal-Mart có tính kinh t cao giá có th bi n ng theo ngày Cơng ty có kh ng m c c cao cơng ty mua v i s l ng r t l n Vi c cho phép công ty nh giá c nh tranh chuy n l i ích cho khách hàng Công ty mang n kh n ng gi m giá nhi u h n b t c nhà bán l khácvà h có thu nh p t t t vi c bán v i s l ng l n Giá tháp m b o l ng hàng bán cao n nh i ích c a h th ng qu n lý chu i cung ng bao g m gi m lead time, t ng vòng quay d tr , báo m c d tr xác h n, t ng không gian kho, gi m d tr an toàn s d ng v n t t n Nó c ng giúp gi m s ph thu c vào nhân viên qu n lý trung tâm phân ph i d n n gi m chi phí t o l i Vi c h t hàng m t mát xu t phát t ó hoàn toàn c lo i b Qu n lý chu i cung ng c a Wal-Mart d n t i t ng hi u qu c a ho t ng m c d ch v t t n Nó lo i b d tr c trì ch t l ng hàng hố Mã v ch công ngh t n s radio cho phép phân ph i hàng xác Cross-docking c ng giúp Wal-Mart gi m chi phí d tr hàng hố Nó c ng giúp gi m chi phí nhân cơng chi phí hangdling khác liên quan t i x p d hàng CÁC CÂU H I TH O LU N Wal-Mart ã có kh n ng t c v trí d n u tơn tr ng ngành công nghi p bán l s t p trung c a h vào qu n lý chu i cung ng Th o lu n chi ti t h th ng phân ph i logistics c tri n khai b i Wal-Mart Vi c s d ng công c công c thông tin tiên ti n ã mang l i l i ích cho vi c qu n lý chu i cung ng c a Wal-Mart V i ý ki n trên, mô t ng n g n làm th IT mang l i i ích cho h th ng qu n lý logistics d tr c a Wal-Mart Các trình qu n lý chu i cung ng c tri n khai b i Wal-Mart trình mang l i hi u qu nh th nào? Th o lu n Tính ch t c a l i ích nh n c b i Wal-Mart t th c ti n ng d ng qu n lý chu i cung ng l i ích óng góp vào vi c trì th m nh c nh tranh nh th nào? Gi i thích EXHIBIT I WORLD’S 25 LARGEST RETAIL COMPANIES BY SALES (2002) Rank 2001 Sales (in mn Dollars) 217,800 67,721 64,902 53,553 50,098 48,264 Rank by Market Cap 12 13 32 39,175 37,931 37,378 20 35,847 14 34,301 34,137 33,640 15 11 P 32,922 P 32,004 48 30,000 P Diversified 29,392 P Company Name Country Wal-Mart Carrefour Ahold Home Depot Kroger Metro AG U.S France Netherlands U.S U.S Germany Target U.S Albertson’s Tesco U.S U.K 10 Sears, Roebuck U.S 11 12 13 Safeway Costco Rewe Gruppe ITM Enterprises U.S U.S Germany Discount Store Hypermarket Supermarket/Hypermarket Home improvement Supermarket Diversified Discount Store/Department store Supermarket Supermarket/Hypermarket Department store/General merchandise Supermarket Wholesale club Diversified France Diversified 15 J.C.Penny U.S 16 Aldi Gruppe Edeka Gruppe (incl AVA) Germany J Sainsbury U.K Supermarket/ Hypermarket 27,121 25 France Diversified 27,079 27 14 17 18 Germany Sector Department store/Drug store Food/Discount store Pinault-Printemps-Redoute 19 20 21 Walgreen Leclerc U.S France Drug store Diversified 24,623 24,195 P 22 Auchan France Hypermarket/ Diversified 23,478 P 23,393 P 22,241 22,111 18 23 24 25 Source: Tengelmann Gruppe CVS Lowe’s Germany U.S U.S Diversified Drug store Home Improvement www.chainstoreage.com Note: *P: Privately owned All amounts are in millions of U.S dollars, using the average 2001 exchange rates All data is corporate level for retail-diversified companies, excluding VAT and non-retailing revenue when available The different businesses of Japanese Conglomerates are accounted for separately EXHIBIT II THE STRENGTH OF WALMART Yearly sales Total employees across the globe Number of stores worldwide Number of Supercenters Number of Sam’s Clubs Number of new stores opened in 2002 Number of suppliers Number of Wal-Mart’s in Texas (US) Value of 100 shares of Wal-Mart (as on January 28, 2003) purchased in 1970 @ $16.50 per share Wal-Mart’s rank/position among all retailers in the US (in terms of grocery sales) Wal-Mart’s rank in jewellery sales Number of pallets shipped by Wal-Mart truck every week Annual sales of hot dogs by Wal-Mart every year (approx) Percentage of dry dog food bought by Wal-Mart in the US Total occupied floor area of Wal-Mart Percentage of toothpaste bought by Wal-Mart Yearly advertising expenditure Yearly purchase of gold for Wal-Mart by its suppliers Highest one-day sales record till date (November 23, 2001) Number of Learjets owned by Wal-Mart Number of pilots owned by Wal-Mart Number of employees employed by Wal-Mart in China Yearly sales of 850 McDonalds stores that operate inside Wal-Mart stores Number of customers everyday at Wal-Mart stores worldwide Number of every day visitors at Wal-Mart’s website, walmart.com Number of items stored by a Wal-Mart Supercenters Items stored by walmart.com Estimated market capitalization of Wal-Mart in 2020 $220 billion 1.28 million 4,382 1,060 495 420 30,000 316 $11.5 million 1 50 million 70 million 35% 18.3 square miles 24% $498 million 18.4 metric tonne $1.25 billion 18 60 4000 $1.3 billion 15.7 million 4, 50,000 1,00,000 6,00,000 $11.1 trillion Source: www.business2.com EXHIBIT III PRIVATE FLEET DRIVER HANDBOOK Wal-Mart's Private Fleet Driver Handbook contained terms and conditions with regard to termination of the truck drivers According to the Wal-Mart's Private Fleet Driver Handbook, a driver could be terminated from his job if he refused to deliver an assignment given to him However, if a driver refused to deliver the assignment due to fatigue or insufficient rest, the refusal was not considered as a violation This book included other rules, the violation of which would result in immediate termination of the driver This book was maintained by Wal-Mart to create awareness about the role, duties and responsibilities of a driver towards the company, society and profession in various situations The expected actions of each driver and the 'code of behavior' was clearly detailed in this handbook and the driver had to strictly adhere to these rules and regulations However, drivers were not terminated simply because they violated the rules and terms mentioned in the handbook The facts, circumstances, situations and other collaborative evidence were taken into account and thoroughly assessed to decide about the termination When a driver violated a rule or 'code of behavior', he was not terminated immediately, but was first taught the correct code of behavior by Wal-Mart For example, though the handbook mentioned that drivers had to be very polite and kind while dealing with the store personnel and others, a driver was not terminated for being rude Instead, he was given a warning and asked to behave properly He was terminated only when he showed no improvement The drivers were also required to secure the truck trailers at the time of delivering them to the stores The inability or failure to so was not considered as a breach of contract that would result in immediate termination However, a driver was once terminated from his job (in the year 2000) by Wal-Mart's then Private Fleet Manager, Mr Paul Darwin, (who took charge in 1998) for leaving a trailer unsecured at one of the stores near a highway Moreover, according to the rules mentioned in the handbook, the drivers should exchange the truck trailers in a totally 'safe and responsible' manner, so that neither the trailers are damaged during exchange or in transit, nor does it result in any loss to other people in the form of injury, etc When a driver leaves an unloaded trailer in front of the Wal-Mart store for the store personnel to pick it up, he should ensure that the trailer is properly safeguarded and secured against a closed dock in the store This would ensure that no other person would gain access to the unloaded trailers For Wal-Mart, an avoidable accident was a more severe offense than refusing to deliver an assignment for dispatch Mr Paul Darwin, the then Private Fleet Manager of Wal-Mart, once dismissed a driver for being involved in an accident that could have been avoided or prevented However, the driver's dismissal was later withdrawn Source: U.S Dept of Labor, www.oalj.dol.gov EXHIBIT IV TYPES OF CROSS DOCKING Opportunistic Cross docking In this method of cross docking, exact information about where the required good was to be shipped and from where it has to be procured and the exact quantity to be shipped, was needed This method of cross docking enabled the company to directly ship the goods needed by the retail customers, without storing them in the warehouse bins or shelves Opportunistic cross docking could also be used when the warehouse management software, installed by the retailer, alerted him that a particular product was ready for moving and could be moved immediately Flow-through Cross docking In this type of cross docking, there was a constant inflow and outflow of goods from the distribution center This type of cross docking was mostly suitable for perishable goods, which had a very short time span, or goods that were difficult to be stored in the warehouses This cross docking system was mostly followed by the supermarkets and other retail discount stores, especially for perishable items Distributor Cross docking In this type of cross docking, the manufacturer delivered the goods directly to the retailer No intermediaries were involved in this process This enabled the retailer to save a major portion of the costs in the form of storage As the retailer did not need to maintain a distribution center for storing various kinds of goods, he helped him save warehouse costs The lead time for the delivery of goods from the manufacturer to the consumer was also drastically reduced However, this method had some disadvantages too The transportation costs for both the manufacturer and the retailer tended to increase over a period of time, when the goods were required to be transported to different locations several times Moreover, the transportation system had to be very fast Otherwise, the very purpose of cross docking was lost The transportation system should also be highly responsive and take the responsibility for the delays in delivery of the goods The retailer was at a greater risk He lost the advantages of sharing the risks with the manufacturer This type of cross docking was suitable only for those retailers who had a large distribution network and could be used in situations when goods had to be delivered in a short span of time Manufacturing Cross docking In Manufacturing cross docking, these cross docking facilities served the factories and acted as temporary and “mini warehouses.” Whenever a manufacturing company required some parts or materials for manufacturing a particular product, it was delivered by the supplier in small lots within a very short span of time, just when it was needed This helped reduce the transportation and warehouse costs substantially Pre-Allocated Cross Docking Pre-allocated cross docking is very much like the usual cross-docking, except that in this type of cross docking, the goods are already packed and labeled by the manufacturer and it is ready for shipment to the distribution center from where it is sent to the store The goods can be delivered by the distribution center directly to the store without opening the pack of the manufacturer and re-packing the goods The store can then deliver the goods directly to the consumer without any further re-packing Goods received by the distribution center or the store are directly sent into the outbound shipping truck, to be delivered to the consumer, without altering the package of the good Cross docking requires very close co-ordination and co-operation of the manufacturers, warehouse personnel and the stores personnel Goods can be easily and quickly delivered only when accurate information is available readily The information can be managed with the help of Electronic Data Interchange (EDI) and other general sales information Source: Compiled by ICMR through sources including web.nps.navy.mil, colby.com.au, wiralogistics.com and tli.isye.gatech.edu 10 ADDITIONAL READING AND REFERENCES: Ortmeyer, K.Gwendolyn, and Lattin M James, "A Theoretical Rationale for Every Day Low Pricing by grocery retailers," Stanford Graduate School of Business, 1991 "Distribution and Retailing in China – Revolution and Competition", www.alberta.org, November 12, 1996 Rowat, Christine, "Cross docking: The move from supply to demand", www.dmg.co.uk, August 1998 Hulet, D.William, "Global Warming and Wal-Mart, Why global warming is a municipal government concern", www.elements.nb.ca, September 1998 "Cross Docking and Cross Docking Network Design", www.tli.isye.gatech.edu, 1998-99 "Cross docking delivers for Retail", www.spscommerce.com, 1999 Harrington, Lisa, “Digital Age warehousing," Penton Media, www.industryweek.com, July 19, 1999 "Distribution strategies, Supply Chain analysis at Volkswagen of America," www.eng.auburn.edu, 2000 O'Brien, P Kevin, "Value Chain Report- Warehouse Management Systems Add Value," www.industryweek.com, www.iwvaluechain.com, February 10, 2000 10 Weiscott, N Maria, "Warehouse Evolution: High Tech Developments Get Industry Cooking", Plants, sites and parks magazine, www.bizsites.com, February/March, 2000 11 "Cross-docking in the U.K," Siemens Dematic, www.siemensdematic.com.au, 2001 12 "What is cross docking?, The Warehouse Word, www.colofwhousing.com.au, 2001 13 Colosino, Robert and Medwyk, Nicholas, "Wholesale Distribution, Managing complex supply chain requirements in the foodservice industry," wholesaledistribution.services.ibm.com, April 11, 2001 Daudelin, Alexandre, "Supply Chain Management the Wal-Mart Way,” Supply Chain and Logistics Journal, www.infochain.org, April 21, 2001 "Wal-Mart.com: The Physical giant goes Virtual," Red Herring Magazine, www.redherring.com, May 7, 2001 Hutten, Staffen and Nyberg, Anna, "Voluntary retail chains and the threats and opportunities of European Integration," www.snee.org, May 15, 2001 "It's not only the retail side, Wal-Mart Distribution", www.Wal-Martwatch.com, January 6, 2002 "Stauffer V Wal-Mart stores, Inc., www.oalj.dol.gov, June 14, 2002 Coyle, J John, Bardi, J Edward, Langley, C John, "The Management of Business Logistics: A Supply Chain Prospective," www.house.gov, June 25, 2002 "Thrify Wal-Mart Partner for Flat Rate Rental Plan," Auto Rental News, www.autorentalnews.com, July 29, 2002 "Trans-loading, Cross docking," www.commoditylogistics.com, October 23, 2002 11 ... customers everyday at Wal- Mart stores worldwide Number of every day visitors at Wal- Mart? ??s website, walmart.com Number of items stored by a Wal- Mart Supercenters Items stored by walmart.com Estimated... Learjets owned by Wal- Mart Number of pilots owned by Wal- Mart Number of employees employed by Wal- Mart in China Yearly sales of 850 McDonalds stores that operate inside Wal- Mart stores Number... sales) Wal- Mart? ??s rank in jewellery sales Number of pallets shipped by Wal- Mart truck every week Annual sales of hot dogs by Wal- Mart every year (approx) Percentage of dry dog food bought by Wal- Mart