Swot Of Canadian Operations Of Wal Mart: Supply Chain Innovations To Fight Competition In Canada

1236 words - 5 pages

SWOT of Canadian Operations of Wal-Mart –Supply chain innovations to fight competition in Canada

Supply chain innovations should ensure on-shelf availability at retail outlets, improving collaboration between vendors and retailers, translating supply chain costs to product pricing, lean inventory and real time replenishment. Wal-Mart should ensure that process differentiation to determine the right method of moving products with varying demand characteristics (Akehurst, C., & Alexander, N. (1995)
SWOT Analysis of Canadian operations with particular focus on Supply Chain

Strengths

1. Strong distribution process- warehouse, assembly and direct-to-store based on demand variability and margin.
2. Leverage economies of scale to lower vendor prices, achieve distribution and transportation efficiencies. The larger diversity of products attracts customers who want to avoid the transport costs inherent in buying at several stores(Basker et al., 2008)-One stop shopping effect.
3. Cost effective supply chain practices including distribution system, procurement system and logistics system.
4. By making strong use of customer and supplier data, Wal-Mart is able to analyses each demographic consumer behavior and tailor offering accordingly.
5. Fresh Vegetables and Groceries strategy employed by Wal-Mart to take on Loblaw Cos is successful. Wal- Mart’s strategy to forego “super center” banner and invest in “fresh” brand name to take on Loblaw is successful (Business Financial Post, 2013). Wal-Mart emphasized food, while Target asserted stronger price positions in health and beauty aids and non-edible grocery items (business.financialpost.com 2013).
6. Wal-Mart’s private fleet strategy of delivery of goods from suppliers to its distribution centers wherever it is cost-effective to do so is reaping great results.( Fleetowner,2013)

Weakness

1. Smaller vendor’s lack the human resources and information technology capabilities to leverage some of supplier management initiatives of Wal-Mart
2. EDLP is not a sustainable competitive advantage as pricing to bottom will result in laser thin margins. Customer centric innovations and Technology enabled supply chain might be the game changing strategy.
3. High annual turnover rates with weak presence in tier 1 cities with higher discretionary consumer spend is hurting revenue realization.
Opportunities

1. Strong investment in Information technology to streamline information flows and product flows along supply chain(RFID, Retail-Link system)
2. Leverage vendor relationships to optimize supply chain performance(CPFR-collaborative planning forecasting and replenishment)
3. Consignment inventory-transferring ownership from vendor to improve inventory turn-over
4. Increase share of food & grocery market and converting stores to supercenter format.
5. Wal-Mart should invest in its internet channel excellence including e-commerce front end and back end fulfillment.
6. Wal-Mart should project a community friendly,...

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