Wal-Mart's warehousing strategy?

Question

Hi everyone, I'm currently doing a logistics assignment on Wal-Mart. I'm required to look for information on some of the supply chain problems and wat Wal-Mart does to overcome them. One of the areas is on Warehousing. Does anyone knows what kind of warehousing strategy is Wal-Mart using? does it use centralised large warehouse or many smaller warehouses(decentralised)? Hope I get a reply soon! Thanks in advance!

Answer 1

Wal-mart is a leader in managing their supply chain by having extremely efficient data management and inventory tracking. When you purchase a product at wal-mart, the global inventory database is updated and products are replenished from regional distribution centers as soon as the next day. This is a decentralized system. By keeping inventories at small but easily replenishable level at each store, Wal-Mart can adjust pricing on a daily basis to minimize prices while ensuring a profit. Also, they can easily adapt the mix of products in a given store to match the buying patterns of a certain location.

These principles are very similar to lean manufacturing processes employed in the Automotive industry. By reducing inventory and only ordering products when needed, they maintain flexibility in their pricing and selection. See the link below for a series of articles on Wal-Mart.

Answer 2

I would call Wal-mart's warehouses centralised, however, that doesn't mean that there is only ONE warehouse that all the Wal-marts run off of, but many smaller ones. Now, I know that sounds like decentralised, but because of the fact that there are soo many Wal-Marts around, and the fact that many Wal-Marts use the same warehouse, I would still call it centralised. Good Luck on your thing!