The FreightWaves Shipper of Choice award is presented in partnership with ArcBest and recognizes retailers, distributors and manufacturers that are keeping the U.S. economy moving by improving efficiency along the supply chain, providing accessible facilities and fighting driver detention.
Among the top 25 Shippers of Choice for 2021 is … Walmart (NYSE: WMT), which ranked 10th.
About Walmart
| New York Stock Exchange ticker | WMT |
| Headquarters | Bentonville, Arkansas |
| FY/21 revenue | $559.2 billion |
| FY/21 adjusted net income | $15.6 billion |
| Shipper of Choice history | 2019 (top 25) |
Working through supply chain challenges
The pandemic put years of investment in Walmart’s supply chain to the test as sudden spikes in demand for many household essentials resulted in sold-through inventory positions.
Acknowledging the merchandise constraints during 2020, Walmart increased its annual capital expenditure plan to $14 billion for 2021, almost a 40% increase. The increase in spending is aimed at many supply chain initiatives in the U.S., including a demand-predicting supply chain engine, facility automation and fulfillment capacity.
The heightened level of capital investment is expected to continue through the next couple of years.
“The big thing that we’re doing is creating capacity to be able to serve more and to begin work on market fulfillment centers, where we can use locations as hubs for other stores and spokes,” John Furner, president and CEO of Walmart U.S., told analysts on a recent call. “We’ve got a lot of really encouraging supply chain work going on that would help us use the right algorithms to be able to pull inventory from all across the network and be able to serve people.”
The supply chain initiatives appear to be paying off for the retail giant. In an environment in which many retailers are struggling to find transportation capacity to stock their shelves, Walmart has been able to leverage its preferred shipper status to procure the capacity needed to take delivery of incremental merchandise.
In its most recent fiscal quarter, the company was able to increase in-stock levels faster than many of its competitors. The company’s inventory-sales spread, or rate of inventory build less the rate of sales growth, increased 980 basis points as merchandise additions (+15.8%) outpaced sales (+6%) for the first time since the July 2019 quarter. The speed at which the company is normalizing inventory positions, from severely depleted levels as a result of the pandemic, highlights the impact some of its prior supply chain investments have had.
“So encouraging just in the last few months to see that not only the capacity has gone up, but e-commerce results have been strong, delivery from stores has been strong, delivery from fulfillment centers has been strong,” Furner said. “So these capabilities we’re putting in place will be a great foundation for this program as we move forward.”
View the Shipper of Choice top 25 winners here.
Shipper of Choice related links:
- The 6 characteristics of a Shipper of Choice
- FreightWaves LIVE: Blue Triton Brands takes Shipper of Choice Award
- Becoming (and staying) a shipper of choice in a volatile market
About Shipper of Choice partner ArcBest
With a relentless focus on meeting customers’ needs and unique access to guaranteed transportation capacity, ArcBest creates solutions to even the most complex supply chain challenges. The company focuses on providing the best customer experience possible with seamless access to a broad suite of logistics capabilities, including truckload, LTL, ocean and air, ground expedite, managed transportation, and warehousing.