Retailer to save billions by purchasing more goods direct from suppliers
15th January 2010 by Sarah Whitworth1 Comment
Wal-Mart Stores plans to squeeze billions of dollars out of its supply chain this year by purchasing more goods direct from manufacturers, cutting out third-party suppliers.
The world’s largest retailer buys less than 20 percent of its goods directly from manufacturers. It wants to increase that share to 80 percent, The Financial Times reports.
That would have a significant impact on its global and domestic supply chains, cutting logistics costs $4 billion to $12 billion or 5 to 15 percent over the next five years.
Read the full article by William B. Cassidy from The Journal of Commerce
16th January 2010 at 3:09 pm
An overlooked benefit of a move to sourcing direct from manufacturers is better visibility of your supply chain and improved flow of supply chain assurance and other technical information.
In our experience agents/traders/distributors who sit between manufacturing sites and end users slow down the flow of information and cloud visibility and responsiveness of a supply chain.