Issues being faced by Wal-Mart
Return: when factor inputs are received, Wal-Mart should have a system of determining defective goods which need to be returned for replacement or refund. Deliveries in excess of the desired quantity should be well accounted for, after making a comparison between inputs ordered and the actual delivered inputs. Problems and issues being faced by Wal-Mart and the core opportunities that is potentially exploitable Wal-Mart is a very large retailer in grocery, but technology is working to the disadvantage of its control for the supply chain.
Software for managing supply chains is not effective enough. Rivalry exists in the industry for food stuffs, clothes and stationary. Competitors have been presenting better products which have lead to a loss in Market value of the Wal-Mart stores. The brand loyalty for the company is therefore low. Wal-Mart is a global company but has few subsidiaries and associate companies worldwide. This lowers the value of the brand name across neighboring continents. Wal-mart is a market leader in the industry for domestic gifts and holiday supplies.
This draws the attention of competitors, who aim at coming up with products that out do those of the company. Strategic planning has not being effective enough and the company’s weaknesses are not being dealt with to avoid exposure to the possible threats in the industry. By being a global retailer, politics of the countries that it operates in, have ruined the public image of the company. Democrat politicians in America, have been using the low Wal-Mart employee salaries as a punch bag. Price competition has really affected Wal-mart’s input sourcing.
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The company’s management has resulted in making purchases from low cost suppliers, which lower the quality of Wal-Mart’s final output. Core opportunities. Wal-Mart has been able to merge and acquire other companies in the industry. This has enabled the Wal-Mart’s output distributions to Europe and China. The strong Brand name has enabled the process of acquisitions, aimed at maximizing the company’s market value with a strategic plan for Supply Chain Management, Wal-Mart can exist to the unforeseeable future given the customer loyalty for its products.
RFID in Wal-Mart Radio Frequency Identification for price tagging and forklift bundles has destabilized the industry. Wal-Mart needs its suppliers to use the RFID system. The supply chain is affected by this new customer’s order and it can be considered as a threat in the field that Wal-Mart sources for its inputs. The competitors are already moving into the new technology making it hard for Wal-Mart to retain its Market leader position. The Real time cost Accounting method is new to Wal-mart and its suppliers.
Ordering, purchasing and Acquisition executives at Wal-Mart need training on the RFID which may cost the company a lot of funds. In Supply Chain Management, cost Accounting procedures are considered as an internal control procedure, where all factor inputs should be tracked. The introduction of RFID provides Real time cost Accounting which is new to the company. Out of Wal-Mart’s experience, such accurate procedures need Pilot testing which increases operational costs, lowering the Net Profit margin for the Retail store.