Discuss and evaluate Wal-Mart’s Distribution Strategy
Wal-Mart opened its first distribution center in early 1970 and used this as the
foundation for the company’s distribution strategy moving forward. Sam Walton looked to
achieved economies of scale by building high volume distribution centers that could serve a
number of stores. This framework of distribution has been a major component of success for
the company and has led to thousands of new stores and major growth. Wal-Mart quickly and
quietly created the most e(cient logistics network of anyone in their industry by locating stores
in low-rent suburban areas that were conveniently located near major highways (Cravens &
Piercy, 2013).
Wal-Mart has 75,000 employees that make up their logistics and information systems
divisions. Part of this figure includes the largest private truck 2eet base of any firm. Wal-Mart’s
7,800 drivers are responsible for delivering the majority of merchandise that is sold at Wal-Mart
stores. Drivers pick up the product at suppliers’ warehouses and then transport them to Wal-
Mart’s distribution centers. To be more e(cient, Wal-Mart has trucks generate “back-haul”
revenue by transporting unsold merchandise on trucks that would typically be empty. Using
this strategy has been able to generate more than a billion dollars a year for Wal-Mart (Cravens
& Piercy, 2013).
Explain Wal-Mart’s information system
