Wal-Mart changes frustrate produce suppliers

04/30/2010 02:33:04 PM
Dan Galbraith

“(Wal-Mart is) a very difficult vendor to deal with. We have turned them down as a local supplier and ship to their warehouses only as a last resort,” one said.

Another: “From what I understand, their new initiatives will make things much more chaotic for suppliers. Not a good move on Wal-Mart’s part.”

In support of Wal-Mart

Still, some grower-shippers said they think Wal-Mart is going in the right direction, focusing on continuing to slash costs and targeting growing demographic markets, such as Hispanics in the U.S.

Among the few positive responses:

  • “Wal-Mart’s new model could present significant opportunities for us.”
  • “It will hopefully drive volumes for the industry.”

Other respondents made somewhat guarded positive remarks about Wal-Mart, expressing hopes of doing new or increased business with the company — but sounding more like they’re taking that stance only out of necessity:

  • “I expect that we will figure out a way to continue doing a lot of business with Wal-Mart.”
  • “Not sure … Maybe can get some produce into Wal-Mart … (but) not sure that we want to.”
  • “Like all key customers that change direction in purchasing, we are concerned. The fact of the matter is they will need more produce and not less, so we will see how it all pans out.”

Whatever the future holds for the produce industry’s relationship with Wal-Mart, it’s clear from these survey results that the retail giant needs to mend fences with its suppliers to maintain the ability to offer top-quality produce to its consumers. 

The backlash from alienation of too many suppliers now may seem like a small price for Wal-Mart to pay, but, in the end, it could ruin Wal-Mart’s entire produce department strategy.

E-mail dgalbraith@thepacker.com

What do you think about Wal-Mart's procurement tactics? Leave a comment and tell us your opinion.


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