Walmart to boost US sourcing

Date : 15 January 2013

Walmart is to buy an additional $50bn in US products over the next ten years for its domestic operations.

Looking to bring production back to the US

Walmart's initiative to support US manufacturing will be driven through increasing sourcing for products which are already bought in the US, including sporting goods, storage products and paper products, and by helping to onshore US production in high potential areas including textiles, furniture and higher-end appliances.

Long term agreements to give suppliers more certainty

Against a backdrop of rising labour costs in Asia and higher and more variable oil and transportation costs, many companies are now looking at where they will invest next following decades of investment in Asia. Many have indicated to the retailer that they have defined the “tipping points” at which manufacturing abroad will no longer make sense for them. Walmart US’ President & CEO, Bill Simon, highlighted the role which the retailer can play through providing longer-term agreements which will enable manufacturers to make the investments required. Later this year a new range of towels will be launched in-stores under the ‘Made Here’ brand following a long-term commitment that has been made to a manufacturer in this category.

Dedicated team to lead the effort

Currently around two-thirds of what the company spends to buy products at Walmart US are either made, sourced or grown in the US. However, Walmart believes that it has scope to increase this and support national job creation strategies. To help achieve this commitment, Walmart has created a senior team within the organisation to lead this effort and it will help convene a manufacturing summit for stakeholders to work together and help accelerate these changes later this year.

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