Walmart’s Consolidation Centres Aimed at Supply Chain Efficiency

Walmart’s consolidation centres all over the U.S are expected to increase the speed and efficiencies with Walmart’s supply chain. These high-tech consolidations centres are able to receive, sort and ship freight out to the retailer’s other 42 regional distribution centres.

Consolidation Centres way of working

Walmart operates approximately 10,500 stores and clubs under 48 banners in 24 countries and eCommerce websites. We employ over 2.2 million associates around the world — nearly 1.5 million in the U.S. alone.

Walmart’s supply chain now uses 11 third -party consolidation centres know as CenterPoint, which are located throughout the U.S. The facilities mostly consist of cross dock terminals that take products shipped using less than full-truckload (LTL) and bundle them into full-truckloads for better efficiencies. Walmart likes to move products in full-truckload because it is less expensive, minimizing the net landed cost of goods into their distribution network. The freight coming from the consolidation centers is routed to Walmart’s 42 distribution centers, which then concentrate on moving the items to the stores.

Rather than suppliers sending small shipments directly to Walmart’s distribution centres oround the country, Walmart reduces freight costs by having suppliers transporting their LTL loads into the nearest CenterPoint, which consolidates all merchandise going to the same distribution centre with the goal to achieve a full-truckload inbound to every distribution centre. Once the full-truckload is achieved or a time window constraint has elapsed, trucks are dispatched from the CenterPoint to the distribution centre.

Consolidation Centres design

CenterPoint distribution centres are similar in shape and size to cross dock terminals in which they tend to be long skinny buildings with many dock doors on either side of the building. The exception to this rule is with facilities that must use cold storage. These facilities are strategically located around the U.S with the objectives being to minimize inbound transportation costs primarily for LTL loads.

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