Walmart’s Inventory Management

From the previous lesson about managing inventory, I suppose we can also learn a thing or two by looking at Walmart’s inventory management practice. Walmart categorize their inventories into many types. Each type is intended to fulfill a certain role in the firm’s inventory and supply chain. In the following I will describe the most notable ones:

Finished Goods Inventory

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This type is the most significant in Walmart’s business. Finished goods are delivered to the company’s stores to support its operation. They are usually stay in storage for a very short time before being sold to the customers. This type of inventory is naturally replenished regularly.

Transit Inventory

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The transit inventory type is the second most significant in supporting Walmart’s business. The name of this type is meant for the goods that are held in transit. As the supply chain of Walmart is on the global scale, many goods stays in transit from days to months. This type acts as support for replenishment of the Finished Goods mentioned above.

Buffer Inventory

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The Buffer Inventory type is kept in small quantity to prepare for the unpredictable demand fluctuations. Every Walmart stores reserve this type of inventory to ensure the capacity of the firm to satisfy customers in any situations.

Anticipation Inventory

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The Anticipation Inventory type is more or less similar to the Buffer Inventory type for the reason that its main purpose is also to prepare for an increase in demand. The difference between these two types is that the Anticipation Inventory type is based on seasonal changes, which means the increase in demand can be expected and anticipated. Most famous example for these seasonal changes are Black Friday and Christmas holiday.

The four inventory types above represent the most distinguishable categorizations of inventory. Each type have its own very clear purpose that fulfills the now-essential requirements of modern business that we can certainly learn from.

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One thought on “Walmart’s Inventory Management”

  1. Very intresting your topic. Actually you are mention the types of inventory in the supermarket and it can be different in some industries because it depent the sector where develoment different activity.

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