Walmart Seeks to Make the Buying Process More Efficient

— February 15, 2017

Walmart for the first time will combine its own buying for products sold at its stores with purchases it makes for its website, sources told Reuters, a significant move to stamp out duplicate efforts as it consolidates buying operations to better fight Amazon.  

Vendors contacted by Walmart about the change told Reuters the store and online buying teams of the world's largest retailer currently operate independently.

Walmart has told some vendors it is seeking to make the buying process more efficient for itself and vendors, and improve coordination between its buying teams, according to the report. It also wants to apply its bricks-and-mortar expertise in securing the lowest possible prices to its e-commerce business, according to the vendors, who spoke over the last few days. They declined to be identified for fear of disrupting business relations with Walmart, Reuters said.

The company has told vendors it plans to disclose the change at a meeting with suppliers later this week, the vendor sources told Reuters.

Walmart spokesman Lorenzo Lopez on Monday would say only that the company wants to create "a more efficient process that accelerates how we bring the full assortment of products in stores to Walmart.com," according to the report.The company expects Walmart.com's buying team to focus on expanding the online assortment, Lopez told Reuters.

Going forward, Walmart's store buying team based at Bentonville, Arkansas, headquarters will place combined store and Web orders with suppliers who sell on both platforms. Under the new system, an item available for sale in the store will also be approved for sale online, Reuters' sources added.

"The way it operated until now was extremely inefficient for us and them," a large consumer goods supplier told Reuters. "For example, they would buy 5 million cases a year for stores and 500 cases (for) online and then make us go through a different buyer for online. It was a nuisance."

Walmart's buying team in San Bruno, California, will still deal with suppliers that make products that sell only on Walmart.com, the vendors said. Store suppliers who have items they sell exclusively online will also have to go through San Bruno, they added.

The strategy is designed to leverage Wal-Mart's powerful Bentonville purchasing operation, where dozens of vendors have set up offices solely to facilitate sales to Walmart.

 

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