Report: Wal-Mart asks suppliers to cede control of deliveries
Bentonville, Ark. Wal-Mart Stores is seeking to take over U.S. transportation services from suppliers in an effort to reduce the cost of hauling goods, according to a Bloomberg report.
The company is contacting all manufacturers that provide products to its more than 4,000 U.S. stores and Sam’s Club membership warehouse clubs, the report said. The goal is to take over deliveries in instances where Wal-Mart can do the same job for less and use those savings to reduce prices in stores, it added.
“It has allowed our suppliers to focus on what they do best, manufacturing products for us,” Kelly Abney, Wal-Mart's VP corporate transportation in charge of the project told Bloomberg. “With lower costs usually comes increased sales.”
Under the program, Wal-Mart is increasing the use of contractors, as well as its own private fleet of trucks, to pick up products directly from manufacturers and transport the goods to its distribution centers and stores. The retailer currently moves most goods only from its distribution centers to stores.
The plan allows Wal-Mart’s fleet of 6,500 trucks and 55,000 trailers to carry more per truck and improve on-time delivery rates.