Winning Rural Delivery: How Walmart Suppliers Should Plan Inventory
8th & Walton's Terry Clear discusses how Walmart suppliers should adjust inventory and forecasting to ensure compliance and strong sales.
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Lainie: The latest frontier in the battle between Walmart and Amazon appears to be rural area delivery speeds. How should Walmart suppliers adjust inventory and forecasting as rural demand grows and delivery speeds increase?
Terry: It really comes down to making sure you have the right items in the right stores, because for Walmart, these rural deliveries are going to come from stores in the area. So, to get quick rural delivery, you need to make sure you have the right items in the right stores. Clearly, some items sell across the spectrum. They sell everywhere. But if you have items that do better in rural markets, make sure you have those items in the store and on the mod. Okay. And that’s a conversation to have with the buyer. It’s always been about getting the right items in the right location.
Lainie: So, you would recommend that be a topic brought up between the supplier and the buyer?
Terry: Absolutely. A lot of times, suppliers think that they want their product in all stores. Well, maybe your product shouldn’t be in all stores, because we don’t want to sell beachwear in Wyoming, and we don’t want to sell snow shovels in Florida. So it’s not about all stores; it’s about the right stores. So know where your product sells, know the demand, and that’s the conversation to have with the buyer.
Lainie: What does Walmart’s store-based fulfillment model mean for suppliers when you compare it to Amazon’s micro-hub approach?
Terry: It goes back to making sure you have, on the Walmart side, the items in the stores that are going to fulfill those rural orders. Now, Amazon has a little bit different approach to how they’re going to forward-deploy inventory to serve those rural markets.But again, for both companies, it goes down to what the demand is going to be for items in these rural markets and how they can make sure they have, for Walmart, items in those stores and, for Amazon, items in their micro-fulfillment centers.Are you a Walmart Supplier? Get in touch to schedule a free consultation:
Lainie: Where do you see the biggest opportunity for suppliers in the $1 trillion rural market over the next few years?
Terry: It’s really market availability and velocity. So both Walmart and Amazon will continuously adjust their holdings based on item velocity. Space is too precious to waste on items not moving. Whether you’re fulfilling through Walmart and putting items in stores that can be fulfilled into the rural market, or at Amazon, you’re going to have items in their micro-fulfillment centers that are going to serve these rural markets. Neither one of those companies wants to have products in there that just collect dust. So let’s get the right items that are going to have the right velocity to serve the customers.
