Home » Walmart Highlights Its Supply Chain Growth During Meeting
Corporate Store News Southwest

Walmart Highlights Its Supply Chain Growth During Meeting

Walmart logo

Walmart is kicking off its two-day 2023 Investment Community meeting, where company leadership will highlight how it is investing to strengthen its business through its people.

It is also discussing its next generation supply chain network of stores, clubs and fulfillment centers and how it is driving future global growth opportunities across its omnichannel ecosystem and high value initiatives. The company will also reiterate its first quarter and full-year guidance for fiscal year 2024.

“We are in a unique position to serve our customers and members however they want to shop, which will fuel continued growth,” said Doug McMillon, Walmart president and CEO.

“As we grow, we will improve our operating margin through productivity advancements and our category and business mix, and drive returns through operating margin expansion and capital prioritization.”

As part of the meeting, the company is highlighting its purpose, culture and the importance of its employees and unveiling its plan for a new, more connected and automated supply chain which will improve the experience and increase productivity.

Through its work, Walmart is reengineering its supply chain to fulfill customer needs with a more intelligent and connected omnichannel network that is enabled by greater use of data, more intelligent software and automation. The outcome improves in-stock, inventory accuracy and flow whether customers shop in stores, pickup or have a delivery.

Walmart showcased its supply chain innovation April 4 at its Brooksville, Florida, regional distribution center, as one piece of how the company is building a scaled system of supply chain capabilities that uses a combination of data, software and robotics. Through automation and technology, the company illustrated how the increased item storage allows the distribution center to provide a consistent, predictable delivery service to stores and customers.

By the end of fiscal year 2026, Walmart believes about 65 percent of stores will be serviced by automation, approximately 55 percent of the fulfillment center volume will move through automated facilities and unit cost averages could improve by approximately 20 percent.

As the changes are implemented across the business, one of the outcomes is roles that require less physical labor but have a higher rate of pay. Over time, the company anticipates increased throughput per person, due to the automation while maintaining or even increasing its number of employees as new roles are created.

“It all starts with our associates,” McMillon said.

“We are a people-led, tech-powered omnichannel retailer. As it relates to being people-led, it’s about purpose, values, culture, opportunity and belonging. We serve our associates by creating opportunities. Opportunities that turn jobs into careers. We help bring dignity to work by enabling them to see how they’re serving others, as part of a team, and helping them achieve their potential. And as we serve them, they serve our customers and members well…they make the difference.”

Walmart will outline how the company expects its growth investments to transform its financial profile, centering on three key building blocks: sales growth from its omni-channel business model, diversifying earnings streams through improved category and business mix and scaling high-return investments that drive operating leverage and improve incremental operating margins.

“We believe that we have the building blocks in place to help define the next chapter of retail and do so while driving strong growth and shareholder returns,” said John David Rainey, Walmart EVP and CFO.

“Looking at where we are today, we believe that approximately 4 percent sales growth, and growing operating income at a faster rate, are still the appropriate targets for our business over the next three-five years. The investments we’ve made have positioned us well and stand to generate steady and sustained growth at higher margins. Achieving our targeted 4 percent sales growth over the next five years would add more than $130 billion of sales on top of our roughly $600 billion base today. On top of that, we think the opportunity for operating income growth over the next three-five years could be better than what we’ve outlined.”

Featured Photos

Featured Photo PLMA Annual Private Label Trade Show
Donald E. Stephens Convention Center
Chicago, Illinois
Share via
Copy link
Powered by Social Snap