Wal-Mart global sourcing up 18% in U.S.

Retail Editor 8, October 13, 2010

Bentonville, Ark. - After overhauling its global sourcing structure earlier this year, sourcing is up smartly in various Wal-Mart Inc. markets around the world - up 18% in the U.S. and 19% overall. The goal for next year is to increase the total amount of direct sourcing for its global operations 25% next year.

Wal-Mart operates four hubs known as Global Merchandise Centers (GMC), with Li & Fung's stand-alone Direct Sourcing Group (DSG) dedicated solely to Wal-Mart business.

DSG is now Sam's Club's No.1 channel for product, vice chairman Eduardo Castro-Wright said during the company's analyst meeting today. "It's going very well," he said.

When private label food is added to the equation, Wal-Mart's GMCs and the DSG operation provide about 30% of the company's total product mix, with importers/manufacturers contributing the rest. The goal, over time, is to invert those numbers, with the shift slated at a 25% compound growth rate over the next five years, said Castro-Wright.

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