Walmart 5 Years Too Late?

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Quite ironic as it says on the building "our people make the difference" and they sure do. Problem with Walmart is middle management as there is none. No one is hands on due to cost cutting over the years so no one really knows their job well enough to see the problems.

Yesterday Walmart announced that they expect the business to be weaker this year with a lower dividend for investors. Investors not surprisingly sold dropping the share price down by close to 7%.

The company announced they were going to invest $14 Bullion into certain areas of increased salaries but mainly into supply chain, automation and an increase to giving the customers a better overall experience. Happy customers spend more money and the longer you can keep them onsite the better. Attracting them by offering other services is their secret plan. Sounds rather desperate if you ask me and I know as the Walmart business is mirrored around the world which it is then they have problems. I noticed that they are off loading many businesses overseas that they had joint ventures with as concentrating at home sounds like a smart strategy.

I know only too well what Walmart is like with supply chain as I have seen it first hand for over 10 years. If you saw it operating you would ask yourself how they make any money as lets just say a hands on approach is what is needed. Automating the warehouses would be where the obvious spend has to happen as it is far easier to program something that will do the job efficiently.

The truth is the company as the saying goes has paid peanuts so they had a work force of monkeys running the supply chain. They saw the supply chain as a cost and not a money maker so they handicapped it by reducing costs instead of improving it. Everyone outside looking in could see this with time wastages and breakages an everyday occurrence.

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Automated racking should have been implemented years ago with a retrieval system.

Suppliers take advantage of Walmart's Supply Chain as the problem they have is the buyers don't understand what they are buying. One just has to look at the CHEP Pallet supply that happens world wide to see where money is literally being burnt daily. Every time that pallet moves out of the warehouse there is a cost to Walmart to return it plus don't ever dare break it which they do in their thousands costing them tens of millions in penalties.

I literally could talk for hours on what is wrong with just the supply chain and why automation couldn't come soon enough for them. This move is probably 5 years later than it should have happened ,but it is a positive move in the right direction with one which they had very little choice as the problem is that obvious.

A better customer experience would be to have fully stocked shelves also leading back to the supply chain yet again. I hear they want to use the car parks for health clinics and other public services which is just a ploy to get customers coming back to the stores guaranteeing sales. Online is really hurting them and they can't compete with Amazon as the service improves.

I have to laugh as you can't compare Amazon and Walmart in the same breath. A prime example 2 years ago at Christmas time Walmart had over 300 containers sitting at the port because the warehouses were full yet the stores had out of stocks. A really messed up situation and it is down to the staff they employ and nothing else.

I just can't imagine Walmart getting the online right until they fix their supply chain. This is going to take years to fix and by then Amazon will have taken another huge chunk out of the Walmart customer base. This is why I say it is 5 years too late and they are in trouble. You are never too big to fail as the bigger you are the harder you fall. This is a monster of a business with monster size problems. I often refer to them as the CYA company as instead of doing their jobs they are to busy covering their ass so someone else takes the blame.

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