Walmart rationalizing supply chains; world quakes in response

FRONT PAGE: "Walmart takes aim at supply chain cost: Drive to increase global purchasing; Retailer seeks to cut supplier companies," by Jonathan Birchall, Financial Times, 4 January 2010.

Best to check out my partner Steve DeAngelis's blog post on this article, which really caught my eye, especially the stuff about how Walmart intends to rationalize its purchasing of food (the usual Protestant Reformation of cutting out middlemen and seeking a direct relationship with producers).

Locals will naturally decry the death of middlemen, who add nothing but cost and waste and complexity, but this sort of manufacturer-to-retailer bonding will define the next great wave of globalization's tightening up.

Why? Because there's such immense inefficiency there to root out.

Comments

[David Sutton]

Working as a project manager I soon realized that with a bit of work on my part I could by pass many of the inefficient and budget sucking middle men, go straight to a manufacturer and get a far better deal for the company I represent.

If Walmart can do the same then kudos to them for seeing an opportunity to increase the effectiveness of their supply chain.