story by Kim Souza
Collaboration between the retailer and supplier is nothing new, but a new facility recently opened by Crossmark in Bentonville is designed to offer a new level of technology and virtual planning for suppliers doing business with Wal-Mart Stores. The new center is located at ground zero for retail – directly across the street from Wal-Mart’s corporate office.
The Crossmark Center for Collaboration is 19,000-square-feet of meeting space that is equipped with technology throughout, a test kitchen for food suppliers, and a catering kitchen. The center also provides two separate lab spaces with a high resolution touch screen that covers one full wall.
The two labs can be used for modular space planning in the virtual world and for shopper marketing tests. Planning in the virtual space can save time and labor of multiple modular reconfigurations when trying to get the right set-up.
There are nine conference rooms with large screens that are connected directly to the Internet, which are much more functional for Wal-Mart suppliers involved in joint business planning with the retail giant. Crossmark did not give the exact cost of this new center, but planning records projected the cost between $5 million an $8 million.
“Most meetings between supplier and retailer occur in these small rooms at the Wal-Mart home office. These rooms are not large enough to accommodate larger groups like the joint business plan meetings and they are not equipped with the latest technology,” said Mike Graen, vice president of collaboration at Crossmark.
Graen spent 25 years at Proctor & Gamble calling on Wal-Mart, and then five years at Wal-Mart working on supplier collaboration. He joined Crossmark in October to head up this new collaboration lab which was just completed and is now giving tours to local suppliers and potential members.
“This new center is not a corporate office for Crossmark. There are three people who work in this building including me. We see this center as a neutral facility where Wal-Mart and suppliers large and small can come together to collaborate on their business relationships to better serve their customers,” Graen said.
Duncan Mac Naughton, chief merchandising officer for Walmart U.S., said recently that the retailer’s goal is to do 300 joint business plans with suppliers each year. Wal-Mart has been completing about half that amount in recent years.
Graen said the center will help suppliers focus on core items, conduct shopper research and test new concepts that could positively impact their respective businesses. It’s also a training center and offers a large open space that can accommodate about 100 people.
He said the building capacity is about 450 and with the large screens in each room the full house could be connected via technology. There is also a separate work room to accommodate suppliers who have presentations in the building when they are not in the meeting. Graen said they have piped in the flight schedules to Northwest Arkansas Regional Airport and have a printer set up for boarding passes to accommodate suppliers who will work out of the center while in town to see Wal-Mart.
Graen’s Wal-Mart years included work on the SPARC (Supplier Portal Allowing Retail Coverage) project, which was a collaboration between the retailer and several suppliers aimed at providing more info on inventory and to improve on-shelf availability.
Graen said there is a training lab in the new collaboration center to help merchandisers and suppliers with improving on-shelf availability.
“The initial reaction from Wal-Mart and suppliers who have toured is quite positive. I foresee this building being used a lot. Any supplier can use the space if they are a member. We charge memberships for certain hour usage. For instance $10,000 a year will get you 100 hours up to $50,000 a year for 500 hours,” he said. “You don’t have to be a Crossmark customer to use the space.”