As reported recently in Business Week, Walmart has embarked on a major expansion of their long-standing effort to take control of suppliers’ shipments to the retail giant’s distribution centers.
Instead of the manufacturers delivering, Walmart proposes to pick up products directly from the suppliers’ factories, and use their clout to lower shipping costs. Walmart expects, in turn, to pay less for the merchandise; the company is asking for discounts of up to six percent from vendors.
Some vendors are not happy with Walmart’s arithmetic, and note that costs for shipping to other customers will likely rise, as they will now be negotiating with carriers on a smaller volume of business.
While your company may not be in a position to take over your suppliers’ shipping, or even want to, it’s worth taking a look to make sure you aren’t being taken advantage of. Time after time, we see shipments charged to the wrong accounts, unnecessary use of overnight delivery, and companies paying list price rather than take advantage of all available discounts.
Supply chain inefficiencies mount up, and can mean the difference between middle-of-the-pack and best-in-class logistics performance. Companies that control their supply chains control their future. Walmart knows this – do you?