Wal-Mart's Green Supply Chain Strategy

Wal-Mart's Green Supply Chain Strategy

Supply chain is a network chain structure formed by upstream and downstream enterprises that participate in providing products or services to end users in the process of production and circulation. Next, I will bring you Wal-Mart's green supply chain strategy. I hope you like it!

Wal-Mart Green Supply Chain Strategy 1 "Sustainable Value Network"

Any change needs not only the high-level leadership, but also the support, recognition and cooperation of the backbone of all business departments of the company, especially in the aspect of sustainable development. Wal-Mart's sustainable development strategy has been formulated for more than a year. After several rounds of high-level meetings, the project was discussed by the "Grassroots Strategy" team for six months to solve the implementation problems.

In June, 2004, Lisig met with Ellison, president of consulting firm BluSkye, analyzed Wal-Mart's existing environmental footprint, and locked the key point of the problem in the supply chain. From June to September, Ellison held many talks with many Wal-Mart executives on sustainable development. The first "selective meeting" was held in September, which mainly discussed whether to incorporate the "sustainable development" factor into the company strategy. Twenty-five senior managers and 30 future managers of Wal-Mart were asked to participate, but the head of the "Environmental Protection, Health and Safety" department was not invited to participate. Its purpose is to let all participants know that sustainable development is by no means another "additional strategy", but a new business opportunity in the company's growth. The two-day conference will be held. On the first day, BluSkye will lead the company to cooperate with some suppliers who have implemented sustainable strategies to explain the environmental challenges facing Wal-Mart to the participants. The next day, participants discussed and decided whether to formulate a sustainable development strategy and how to implement it.

Three months after the "selective meeting", the sustainable development plan was approved by the board of directors, and a decisive promotion meeting was held in June 5438+February 2004. The meeting made it clear that Wal-Mart will cooperate with suppliers, non-governmental organizations and the government to promote sustainable management, and formulated training plans, process reporting plans and implementation plans.

Then enter the second stage, that is, the stage of making the business plan. Wal-Mart executives developed a six-month "grassroots strategy" seminar. Managers from different departments of major supermarkets and Sam member stores form several leading groups respectively. Organize various studies and discussions under the leadership of each group, mainly focusing on four aspects: first, how to re-examine Wal-Mart from the perspective of external stakeholders; Secondly, how to continuously expand the scope of employee participation and avoid faults; Thirdly, we choose two strategic plans: one is the "overall" plan to make Wal-Mart gradually ahead of competitors, and the other is the "leading" plan to concentrate the company's advantages and create unique breakthrough results for Wal-Mart; Fourth, how to ensure that each strategy creates business value while ensuring environmental benefits.

After this extensive research and discussion, Wal-Mart's multi-department leading group reached a consensus on the sustainable development strategy and decided to implement the "leading plan" that can produce breakthrough results. 14 leading group, which played an important role in the "grassroots strategy" seminar project, was transformed into the leading core of 14 "sustainable value network". The leading core will carry out inter-departmental cooperation within the company and attract major external stakeholders, including suppliers, NGOs and the government, to participate in the plan. Therefore, the "grassroots strategy" seminar group has been transformed into a pioneer in implementing the "sustainable value network" strategy.

According to the goal concept announced by Lisiger, these 14 "sustainable value networks" are divided into two categories: including global greenhouse gas strategy, alternative fuels, and modules such as energy, design, construction and maintenance, global logistics, operation and internal procurement and packaging, which are directly controlled by the company and directly used to promote the realization of renewable energy and zero waste. Textiles, electronic products, food and agriculture, forest and paper, chemical-intensive products, jewelry, seafood products and "China" sustainable network need to be coordinated with suppliers to achieve the third goal, that is, to sell environmentally friendly products.

Wal-Mart has always adopted a relatively independent management model, conceptually excluding non-governmental organizations, government, consulting, scientific research and other external stakeholders. The lack of sustainable development and environmental performance experts within Wal-Mart forces it to accept these stakeholders. On the other hand, it used to operate through a price-based and business-based market, but now it begins to generate value through long-term cooperation with non-profit organizations, suppliers and other external stakeholders. Therefore, the "sustainable value network" fundamentally changed Wal-Mart's operating model and business model.

Considerable implementation effect

Since the official launch of the sustainable development strategy in June 2005, 65,438+04 "sustainable value networks" have achieved initial results. From the report on the process of "sustainable development strategy" disclosed on Wal-Mart's global website in mid-2008, we can find some recent achievements.

From the direct goal, Wal-Mart has improved the operational efficiency of store construction and maintenance, reduced energy consumption and carbon dioxide emissions, made more use of renewable energy, and reduced garbage and solid waste; In terms of logistics and transportation, reducing packaging and reasonably designing driving distance have also improved the operation efficiency of the global logistics network and reduced the fuel consumption and greenhouse gas emissions of the fleet.

In terms of indirect objectives, Wal-Mart and non-governmental organizations have developed many tools to detect and supervise various products sold by Wal-Mart. Including "packaging scorecard" for chemical-intensive products, "sustainability screening tool", "network scorecard" for electronic products, "supplier scorecard" for textiles, and jeweler's measurement and evaluation system. These tools have improved the environmental performance of suppliers, acquired breakthrough technologies and developed new revenue sources, thus strengthening the relationship between Wal-Mart and suppliers.

The secret of smooth implementation

Wal-Mart's sustainable development strategy not only organically combines the two parts of corporate purpose, but also drives more than 60,000 suppliers onto the road of sustainable development. The success of this strategy is mainly based on the following three reasons:

First, top-down cultural change. Li Sige, former president, is the main advocate and promoter of sustainable value network strategy. Under his personal leadership, after more than a year of interviews, discussions and training, the company's top management reached an agreement on strategic transformation. This process not only makes top managers realize that sustainable development strategy will be a new opportunity for the company's growth, but also deeply embeds the elements of sustainable development into the core affairs of the company and into all aspects of the company. The leaders of "Sustainable Value Network" completed this work based on their previous main responsibilities, instead of treating the new strategy as extra work. With the knowledge of * * * *, Li Sige set ambitious and specific goals for the whole company, and mobilized the middle-level and external stakeholders of the whole company through the "grassroots strategy", paving the way for the implementation of the strategy.

It can be seen that the sustainable development strategy must be recognized and promoted by the company's top leaders and combined with the company's business model, and it cannot be regarded as a departmental change or an additional strategy. As Ruben, vice president of strategy and sustainable development, said, "Lisig is pushing this strategy 100%, and he is actually changing the company's culture. Without the support of senior management, this strategy cannot be carried out. "

Second, turn it into a commercial advantage. The reason why Wal-Mart can continue to promote the "sustainable value network" is largely because this strategic action has brought direct economic benefits and inspired employees. Wal-Mart first found an energy-saving and emission-reduction project that can be "quickly successful". Through the cooperation of "logistics network", the transportation fleet saved 25 million dollars in diesel consumption in 2006; Through the cooperation of "Building and Maintenance Network" and the use of the most advanced heating, cooling and lighting technologies, the energy efficiency of each new store will be increased by 30% compared with 2005. Through the "packaging scorecard" to reduce transportation costs, improve the recovery rate of packaging materials and so on. These "premature fruits" have greatly enhanced the confidence of employees in implementing the strategy. At the same time, Wal-Mart has also developed "innovative projects" with great potential, such as the construction of seafood product certification system; Help textile suppliers improve the management performance of product life cycle through "supplier scorecard"; Advocate e-waste recycling and so on. These projects may increase the cost of suppliers in the short term, but in the long run, they can greatly improve the competitiveness of suppliers.

Realizing visible commercial benefits while realizing environmental benefits is the fundamental driving force for implementing the strategy of sustainable development, no matter whether this benefit is short-term or long-term, tangible or intangible. Plambeck of Stanford University commented that "if Wal-Mart's' sustainable value network' strategy is to develop continuously for a long time and realize the long-term environmental protection goal set by Lisig, it must be profitable continuously".

Third, achieve a win-win situation for all sectors of society. "Win-win" is the soul of sustainable development strategy. In February, 2007, Lisig put forward the strategy of "Sustainable Development 360", aiming at further integrating the resources and capabilities of suppliers, employees, NGOs, governments and communities on the basis of "sustainable value network" and achieving win-win results for all parties. This strategy will first bring huge business opportunities for Wal-Mart's sustained growth, and at the same time open the door for suppliers to cooperate with Wal-Mart and non-governmental organizations to solve sustainable development problems. For many NGOs, in the cooperation with Wal-Mart, their respective reputations have been enhanced and the mission of organizational existence has been fulfilled.

It can be seen that sustainable development itself must be sustainable, and it must combine commercial value, environmental value and social value, and it cannot be neglected. As Ellison, president of BluSkye Company, said, "The purpose of sustainable development strategy is to meet the needs of key stakeholders and the whole society while creating shareholder value."

China's participation is indispensable.

Wal-Mart has more than 60,000 global suppliers, of which nearly 20,000 are located in China. Wal-Mart purchases goods worth about $9 billion directly from China every year, and more than 95% of the goods sold by Wal-Mart in China are local products. In Wal-Mart's global "sustainable value network", the only single network established by country is "China", which shows the importance of China.

At the Beijing Summit on June 5438+ 10, 2008, Wal-Mart put forward a series of historic visions and strategic goals. Wal-Mart will establish a "responsible procurement" system in China, including three aspects:

First, establish a global leading high-value sustainable supply chain. To this end, Wal-Mart will ensure that 65,438+000% of its suppliers in China have achieved remarkable energy-saving effects, meeting or exceeding the government's environmental protection requirements and ethical standards; In some cases, Wal-Mart will give priority to purchasing high-quality sustainable goods with higher prices; It will reduce the carbon dioxide emission of China logistics fleet and centralize the distribution center to shorten the distribution distance and reduce fuel consumption. Wal-Mart will also establish a unified framework of social and environmental standards, and an independent third-party review system will supervise all enterprises, thus reducing the financial burden on suppliers and ensuring implementation.

Second, sell environmentally friendly goods. All Wal-Mart stores in China actively promote the production and sale of more environmentally friendly products. Committed to helping customers raise awareness and make them realize the benefits of various environmental protection activities, including the use of energy-saving products, trade-in activities and reducing product packaging throughout the supply chain. Start the "designated farm project" plan, cooperate with farmers to ensure the best operation method and provide more environmentally-friendly and safe products for customers. It is estimated that by 20 1 1, the plan will benefit China 1 10,000 farmers.

Third, become the best environmental retailer in China. In addition to actively reducing the environmental impact of the supply chain and selling environmentally-friendly and high-quality products, all Wal-Mart stores in China, including Wal-Mart Shopping Plaza, Wal-Mart Community Store and Sam Member Store, have set water and electricity saving targets. By 20 10, the energy efficiency of new energy-saving demonstration stores will be improved by 40%; Improve the energy efficiency of existing stores by 30%; Increase the water utilization rate of existing and newly opened stores by 50%; Reduce the use of plastic bags by 80%.

Wal-Mart's Green Supply Chain Strategy Part II Wal-Mart's business has grown rapidly and become one of the well-known companies because it has made great achievements in cost saving, logistics distribution system and supply chain management.

Steve Jobs, president of Apple, once said that if there are only three IT companies left in the world, it must be Microsoft, Intel and Dell. If there are only two, it will be Dell and Wal-Mart. This is obviously just a joke. Although Wal-Mart is the leader in the retail industry, IT is not an IT enterprise in any case. However, Wal-Mart's persistent pursuit of information technology is obvious to all, and because of this, Wal-Mart's low-price strategy has been tried and tested.

reduce costs

Anyone who knows a little about Wal-Mart knows that the low-cost strategy keeps the logistics cost low, which is a trump card for a cheap retailer like Wal-Mart. It is Wal-Mart's consistent business purpose to reduce the cost as much as possible in the process of logistics operation and let the saved cost benefit consumers.

In the whole logistics process, the most expensive part of Wal-Mart is transportation, so when setting up new stores, Wal-Mart should start from its existing distribution center as far as possible, and stores are generally located around the distribution center to shorten the delivery time and reduce the delivery cost. Wal-Mart's investment in logistics is also very concentrated in the construction of logistics distribution centers.

1, a fast and efficient logistics distribution center

Logistics distribution centers are generally set in the center of retail stores above 100, that is, distribution centers are set in major sales markets. This enables a distribution center to meet the needs of more than 0/00 sales outlets in nearby surrounding cities. In addition, the transportation radius is relatively short and uniform, and a distribution center is basically established with a business circle of 320 kilometers.

The order information of Wal-Mart's branches is transmitted to the distribution center through the company's high-speed communication network, and the distribution center formally orders from suppliers after integration. The supplier can send the goods directly to the ordering store or distribution center. Some people describe Wal-Mart's distribution center as follows: the average area of these giant buildings exceeds 1 10000 square meters, which is equivalent to the size of 24 football fields; It contains all kinds of goods that people can imagine, from toothpaste to TV sets, from sanitary napkins to toys, with more than 80 thousand kinds of goods. Wal-Mart has more than 62 distribution centers in the United States, serving more than 4,000 shopping malls. These centers are carefully deployed according to the trade areas of various places. Usually, starting from any center, a car can reach the store it serves within one day.

In the distribution center, the computer is responsible for everything. After the supplier sends the goods to the distribution center, it goes through the procedures of checking the purchase plan and commodity inspection, and then sends them to different locations on the shelf for storage. When each commodity is put into storage, the computer will record their position and quantity one by one; Once the store puts forward the purchase plan, the computer will find out the storage location of these goods, print out a label with the store code and stick it on the goods. The whole package of goods will be sent directly to the conveyor belt, and the scattered goods will be taken out by the staff and sent to the conveyor belt. Commodities go in and out on several kilometers of conveyor belts. The bar code on the conveyor belt can be recognized by laser and sent to the right place. The output of goods on the conveyor belt can reach 200,000 cases a day. For scattered goods, there are some signal lights on the conveyor belt, including red, yellow and green. Employees can determine the store to deliver goods according to the signal light to pick up these goods and put them in boxes to avoid wasting space.

2. Loading table

One end of the distribution center is a loading platform, which can load 130 trucks at the same time, and the other end is an unloading platform, which can park 135 trucks at the same time. The distribution center operates 24 hours a day, with an average of more than 200 trucks loading and unloading goods every day. Wal-Mart uses trucks as big as possible to transport goods. There may be about 65,438+06 meters long containers, which are longer or taller than container transport trucks. This kind of motorcade can often be seen on American highways. Wal-Mart's trucks are all its own, and the drivers are also Wal-Mart employees. They run on the highway between American States, and every cubic meter of the car is filled with oil, which is very helpful to save costs.

The company's more than 6,000 transport trucks are all equipped with satellite positioning systems, and the headquarters can see the location, cargo and destination of each vehicle at a glance. Therefore, at any time, the dispatching center can know where these vehicles are and how far they are from the store, and also know where a commodity has been transported and how long it will take to get to the store. In this respect, Wal-Mart is accurate to the hour. If employees know that the arrival time of the motorcade is delayed due to weather, road maintenance and other reasons, the stevedores can arrange other work instead of waiting.

Flexible and efficient logistics and distribution make Wal-Mart have an advantage in the fierce retail competition. Wal-Mart can guarantee that the delivery time of goods from the distribution center to any store will not exceed 48 hours, and the shelves of Wal-Mart stores can be replenished twice a week on average, while other stores in the same industry can only replenish goods once every two weeks on average; By keeping as little inventory as possible, Wal-Mart not only saves storage space, but also reduces inventory costs.

In the study of American retail enterprises, the economist Dr. Si Tong found that among the three major retail enterprises in the United States, the proportion of commodity logistics cost to sales was 1.3% for Wal-Mart, 8.75% for Kmart and 5% for Sears. If the annual sales amount is $25 billion, the logistics cost of Wal-Mart is $65.438+$86.25 million less than that of Kmart and $425 million less than that of Sears, which is staggering.

direct current

One end of the distribution center is the loading platform and the other end is the unloading platform, so the two operations are separated. It looks no different from the way of loading and unloading, but the working efficiency is greatly improved. The distribution center is a large warehouse, but it is conceptually different from the warehouse.

Cross Docking CD(Cross Docking) works in a unique way and is extremely efficient. When the goods are purchased, they are directly loaded and delivered, and there is no warehousing and sorting operation, which reduces the cost and speeds up the circulation.

800 employees work in shifts 24 hours a day, and the wages of Wal-Mart workers are not high, because these workers are basically junior high school students and high school students, and they are only specially trained by Wal-Mart.

The goods stay in the distribution center for no more than 48 hours. Wal-Mart has tens of thousands of goods to sell, including food, clothing, housing, use and transportation. In particular, the residence time of food, fast-moving consumer goods and other commodities directly affects the use.

How does Wal-Mart continuously improve the organizational structure of its distribution center?

Every store delivers goods 1 time every day (competitors deliver goods 1 time every five days), and at least once a day means that the inventory in the store or retail store can be reduced. This greatly reduces the cost of retail space and manpower management. To achieve this goal, we must constantly improve the organizational structure, so that the establishment of the operating model can meet this demand.

190 There were 14 distribution centers in the world, and 70 distribution centers were established in 5438+0 in 2006. As a Fortune 500 company, Wal-Mart operates only in a few countries, and only in areas where it is sure to develop. Wal-Mart is very cautious in its operation, and under such circumstances, it has grown to 70, indicating that the organizational structure adjustment of its logistics distribution center is in place.

Distribution cost accounts for 2% of sales, which is 50% of competitors' (while only 50% of competitors' goods are distributed centrally). Wal-Mart's distribution cost accounts for 2% of its sales. Generally speaking, the logistics cost accounts for about 10% of its total sales, and some food industries even reach 20% or 30%. Wal-Mart's consistent philosophy is to sell the best things to consumers at the lowest price, which is also where its success lies. In addition, only 50% of competitors' goods are distributed centrally, while more than 90% of Wal-Mart's goods are distributed centrally, and only a few of them can be sent directly to the store from the processing plant, so the cost is much different from that of competitors.

Application of logistics information technology;

Wal-Mart's success is largely due to the ingenious combination of cutting-edge technology and logistics system of its leading competitors for at least 10 years. As early as 1970s, Wal-Mart began to use computers for management. In the early 1980 s, they spent another $400 million to buy commercial satellites and realized global networking; In 1990s, the world-leading satellite positioning system (GPS) was adopted to control the company's logistics, which improved the distribution efficiency and won the satisfaction and loyalty of users with speed and quality.

All Wal-Mart's systems are based on a distribution system called UNIX, and adopt conveyor belts and a very large open platform, as well as product coding, automatic replenishment system and laser identification system, which have saved considerable costs for Wal-Mart. Wal-Mart has always advocated the adoption of the most modern and advanced systems, reasonable transportation arrangements, and ultimate success through computer systems and distribution centers.

Establish the world's first logistics data processing center;

In 1970s, Wal-Mart established the Logistics Management Information System (MIS), which was responsible for processing system reports and accelerating its operation. In the early 1980s, Wal-Mart cooperated with Hughes to launch a logistics communication satellite, which made Wal-Mart develop by leaps and bounds. 1983 adopts POS machine, namely point-of-sale data system. 1985 established EDI (Electronic Data Interchange) system, which implemented paperless operation and all information was operated on the computer. 1986 established QR, that is, rapid response mechanism to quickly stimulate market demand.

Wal-Mart is the first in the world to realize 24-hour computer logistics network monitoring within the group, which integrates procurement, inventory, ordering, distribution and sales. For example, customers shop in Wal-Mart stores and then print invoices through POS machines. At the same time, the information will be displayed on the computers of the personnel in charge of production planning and procurement planning and suppliers, and each link will complete their work in time through the information, thus reducing a lot of unnecessary time waste and speeding up the logistics cycle.

applied technology

Radio frequency technology /RF (radio frequency) can be used in combination with bar codes in daily operations.

Portable data terminal equipment /PDF, the traditional way is to make a phone call, send an email or send a report after the goods arrive, and the goods can be directly inquired through the portable data terminal equipment.

Logistics bar code /BC, using logistics bar code technology, can collect and track enterprise logistics information timely and effectively.

Radio frequency identification (RFID) is a non-contact automatic identification technology. It can automatically identify the target object and obtain relevant data through radio frequency signals. The identification work can work in various harsh environments without human intervention.

In 2004, Wal-Mart, the largest retailer in the world, required its top 65,438+000 suppliers to use RFID technology when sending pallets and packing boxes to its distribution center before 65,438+0 in 2005, and put them into use in a single commodity before 65,438+0 in 2006. Experts predict that from 2005 to 2007, Wal-Mart suppliers will use 5 billion electronic labels every year, and Wal-Mart will save 8.35 billion dollars every year. About 5,000 sets of RFID systems have been installed around the world, with actual annual sales of about 964 million US dollars.

With these information technologies, Wal-Mart has made great progress.

The meaning of logistics includes not only the flow and storage of materials, but also the degree of cooperation between upstream and downstream enterprises. Wal-Mart's success is largely due to its "seamless point-to-point" logistics system. "Seamless" means to make the whole supply chain reach a very smooth connection. Wal-Mart refers to the supply chain, which means that the process from the factory to the store shelves should be as smooth as possible, just like a seamless coat. In the supply chain, every supplier is a link in this chain, and Wal-Mart makes the whole supply chain a very stable, smooth and smooth process. In this way, Wal-Mart's transportation, distribution, order and purchase processing are all part of a complete network, which greatly reduces the logistics cost.

In terms of connecting upstream customers, Wal-Mart has a very good system that allows suppliers to directly access Wal-Mart's system, which Wal-Mart calls the "retail link". Through the retail link, suppliers can know the sales situation at any time, predict the future demand for goods and decide the production situation, so that their product costs can also be reduced, thus making the whole process a "seamless" process.

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