mkt 500 milestone seven

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Jan 9, 2024

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MILESTONE SEVEN: DISTRIBUTION Milestone Seven: Distribution Jordan Sadler MKT 500 Professor Teague

MILESTONE SEVEN: DISTRIBUTION How Will Walmart’s Meal Kits Be Distributed The company that I will be producing a product for is Walmart, and the product that I am proposing for them is a meal kit service that can be distributed from their current retail locations using the in-store pickup option or ordered online and shipped to customers using their e-commerce platform. The key goal for this new service is for it to be the most affordable meal kit service on the market out of the many competitors that currently provide the same service. Luckily, Walmart already has a very robust channel of distribution set up that will help us accomplish this goal. Walmart’s distribution strategy and the different channels that they have set up has been key to the company’s success and it is the main factor in the company’s ability to offer their consistently low prices. We will be depending on their current channels of distribution to successfully execute and supply this new meal kit service. Walmart is known for being a low-cost retailer that offers consistent everyday low pricing on their products. The company is able to achieve this because they have a very extensive network of suppliers that they purchase their merchandise from in bulk at lower prices than their competitors, and they’re then able to pass those savings along to their customers. They also have a very large network of distribution centers that they own and operate which houses all of their products and guarantees that they always have the necessary supplies available to keep their stores stocked at all times. Walmart keeps an incredibly large inventory of their products available at all times, and we plan on using this same system and inventory of products to create their meal kits. By relying on the distribution channels that Walmart already has set up, which has proven to be extremely successful for the company, it will allow us to introduce this new meal kit service with ease and with minimal changes needed from the company. It will also allow

MILESTONE SEVEN: DISTRIBUTION us to maximize the profit from this new service, as the company won’t need to incur extra costs setting up new channels of distribution. Walmart uses a vertical marketing system to accomplish their distribution, which consists of all of their needed channels acting as one unified system to meet their needs. The company currently has 210 distribution centers, which are the hubs of all of their business activity. Walmart also has their own fleet of transportation consisting of over 9,000 tractors, 80,000 trailers, and more than 11,000 drivers. Walmart is able to move goods to and from their distribution centers efficiently because of this fleet of trucks and drivers that they have. Their network of distribution centers is responsible for shipping their general merchandise and groceries to their stores on a daily basis to meet the needs of their consumers at each store. Each of their distribution centers is more than 1 million square feet in size and has over 600 employees that are responsible for unloading and shipping over 200 trailers of supplies to their stores daily. Each distribution center supports up to 100 stores that are in a 150 mile radius from the center (Walmart, n.d.). Outside of their distribution centers, they also have a network of fulfillment centers that is responsible for fulfilling all of their online orders that come from their e-commerce platform, Walmart.com. The efficient system that they use at their fulfillment centers gives them the ability to serve customers quickly and provides options as to how customers would like to receive their orders, whether it be through in-store pickup or shipped directly to consumers homes. Their fulfillment centers are strategically located across the country to give the company very quick and efficient access to their customers using ground shipping methods. Each fulfillment center is capable of shipping and handling millions of orders to consumers (Walmart, n.d.).

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MILESTONE SEVEN: DISTRIBUTION We will be relying on the activity from these distribution and fulfillment centers that Walmart has set up to supply the products needed to fill our meal kit boxes and to ship orders to consumers if they chose to have their meal kit shipped directly to their home. Consumers will sign up for the meal kit service using the company’s e-commerce platform, Walmart.com. Once they have signed up for the service, every week they will be responsible for selecting what meals they want to receive for the upcoming week. And once their meals are selected, they will then be able to choose whether they want their meal kit shipped directly to their home, or if they would like to pick up their meal kit from a Walmart retail location using the in-store pickup option. For the consumers that would like their meal kit to be shipped directly to their home, we will use Walmart’s fulfillment centers to complete these orders. The fulfillment centers will house all of the products needed to complete a consumer’s order, and the meal kit will then be shipped directly to the consumer from the fulfillment center. And for the consumers that would like to pick up their meal kit directly from a Walmart store using the in-store pickup option, the retail location that the consumer selects will be responsible for completing these orders. Each retail location will already have the supplies needed to make the meal kits because they will receive them from Walmart’s distribution centers. Associates from the retail locations will then be responsible for packaging the meal kit orders and having them readily available for consumers for in-store pick up. Organizational Structure Walmart will not have to change anything about their organizational structure to successfully roll out this new meal kit service. Walmart currently operates under a hybrid hierarchical-functional structure, which includes their top level management of CEOs and senior

MILESTONE SEVEN: DISTRIBUTION advisors, as well as their function-based employees that are split up into different categories based on their skills. We will be relying on their function-based employees to execute their new meal kit service. Their functional based structure includes their retail operations and supply chain management teams, which we will be using to manufacture the meal kits. Their supply chain management team is responsible for handling their logistics, transportation, inventory management and procurement. This team manages the flow of their products from suppliers to their distribution centers and stores. We will be using this team to ensure that we have all of the products available to fulfill the meal kit orders. Their retail operations team is responsible for the management of all of their retail store locations. This consists of their store managers and team members that work at their stores. We will be using this team to train and manage the employees that will be fulfilling meal kit orders in stores (Cuofano, 2023). The current organizational structure of Walmart has proven to be successful for the company, and we will be able to use this structure to successfully roll out their new meal kit service.

MILESTONE SEVEN: DISTRIBUTION References About | Our Supply Chain . Walmart. (n.d.). https://corporate.walmart.com/about Cuofano, G. (2023, October 24). What is Walmart’s Organizational Structure? The Walmart Organizational Structure in a Nutshell . FourWeekMBA. https://fourweekmba.com/walmart-organizational-structure/

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