The Supply Side: Wal-Mart to host suppliers for two-day growth summit

by Kim Souza (ksouza@talkbusiness.net) 2,115 views 

Kicking off this new fiscal year Wal-Mart Stores CEO Doug McMillon is changing things up. Instead of having suppliers at the retailer’s year beginning meetings held as in the past, Wal-Mart is holding a two-day Supplier Growth Forum Feb. 15-16 at the John Q Hammons Convention Center in Rogers.

Suppliers have plenty of questions given the recent announcement in the retailer’s replenishment division and ongoing changes being made at Walmart.com under the leadership of new CEO Mark Lore.

Suppliers are likely to hear from McMillon, Walmart U.S. CEO Greg Foran and Chief Operating Officer Judith McKenna either in the opening or closing segments. The opening session is slated for two hours, then suppliers will hear from executives regarding private brands and the categories of hardlines (non-personal items like sporting equipment and electronics) entertainment and seasonal.

The next session will deal with operational excellence for direct store delivery (DSD) suppliers. These suppliers bypass the distribution center. Items that are commonly DSD include bread, soft drinks like Coca Cola as well as chips and other snacks from suppliers like Kraft and Frito-Lay.

The last session on Wednesday Feb. 15 will review in-store events. This has been a push by McMillon in the past few years trying to get suppliers to sponsor events and bring more excitement through retailtainment into the stores. Last year Walmart U.S. Chief Marketing Officer Tony Rogers announced “Walmart’s New Every Friday” program where customers can sample new products which are highlighted around the stores.

Rogers said the company put together a retailtainment committee comprised of merchants and merchandisers to ensure stores around the country are seen as destinations for friends and families. Rogers made the announcement in June 2016 and to date the response from suppliers has been a somewhat lackluster (at least locally) based on a number of stores in Northwest Arkansas routinely visited on Fridays. Insiders expected Wal-Mart to make another push for suppliers to take part as Rogers said the retailer has learned there be a 300% lift in sales when a new product is demonstrated in stores for customers.

Day two of the conference will include a session on digital acceleration, not a surprise given Wal-Mart’s efforts expand its e-commerce capabilities in its U.S. business. The retailer also is in the midst of restructuring the e-commerce division amid a recent layoff off 200 workers and a new management team assembled by Lore.

Eric Howerton, CEO of WhyteSpyder, expects the retailer will again urge suppliers to get onboard with the mandate for unique product content for all items sold on Walmart.com. He said there has been hesitancy among some consumer packaged good vendors to provide Walmart.com product content that is not also provided to competitors like Amazon.

“Walmart.com wants the content to be uniquely theirs, highly searchable with photos and videos where applicable,” Howerton said. “Too many suppliers are merely compliant with the bare minimum content and missing opportunities to grow in-store sales which is high on McMillon’s radar.”

Suppliers will also hear about direct import possibilities. This topic is timely given the talk of an adjusted border tax for imports by the President Donald Trump’s administration. Wal-Mart is among a retail consortium to protest this tax. McMillon was also among the CEO’s asked to meet with Trump on Friday (Feb. 3) in the nation’s capitol.

Wal-Mart will hold a two-hour closing session with suppliers to wrap up the two-day summit. More information on hardlines will be discussed in this session as well as expectations for suppliers as the retailer begins a new fiscal year.

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