Walmart 2002 Annual Report Download - page 8

6
We’re Merchants First
Deep in the heart of Wal-Mart is
the simple idea that our Associates are
merchants first – loyal customer advocates
and skilled shopkeepers who take pride in
the products they sell.
To keep customer-service levels high
and sales increasing, Wal-Mart encourages
Associates to think
creatively about how
they merchandise
products, and gives
them the training
they need to
positively impact
their corner of the
Wal-Mart world.
But at Wal-Mart, merchant skills often
reveal themselves long before an item is ever
displayed for sale. Frequently, these skills
actually come into play when the item is
manufactured and shipped. Over the last
few years, Wal-Mart has improved the
quality of its goods – as well as its supply
logistics and retail prices – by acquiring
certain products for all of its stores around
the world from a single source. Wal-Mart
calls this “global sourcing.”
Thinking Globally
The concept works with items that are
global in scope and need, whether they’re
items for sale or for use by Associates. Items
like copy paper, light bulbs, hangers, fabric
or clothing zippers, are typical candidates
for global sourcing. The savings go right
back to the customer, improving both prices
and the quality of goods. Coupled with
improved logistics, these changes create
improved value for customers.
In fiscal 2002,
Wal-Mart’s Global
Sourcing Team
discovered that
stores in Argentina
were selling
an entry-level
microwave oven
at twice the price of those sold by the
Company elsewhere in the world. The
situation was quickly rectified when the
Argentine Wal-Mart stores contacted the
Company’s global microwave supplier.
Though the new microwave oven costs
half as much, it has the same quality
as the old one, and all the same features.
Global sourcing also helped the
Company negotiate prices for fans and air
conditioners, allowing its ASDA stores in
the United Kingdom to cut prices on the
items by 50 percent, and tripling sales of
the products. But global sourcing isn’t just
about U.S. suppliers helping out stores in
other countries; Wal-Mart also sources items
At Wal-Mart,
merchant skills often
reveal themselves long
before an item is ever
displayed for sale.