Posted by: Matthew Molinari | April 28, 2012

Some Assembly Required

Today I went to Wal-Mart and bought my wife an early Mother’s Day gift. She’s been asking for a patio set for a while and now that the weather is finally cooperating here in Reno, I went out and found one that she ended up loving.

The experience brought to mind two separate issues relating to supply chain management. The first was how Wal-Mart was stocking their inventory and the second was how the manufacturer went about producing the item.

Wal-Mart is one of the best in the business at managing its supply chain. Take for instance their ability to reduce the number of miles driven shipping their goods across the country. So I fully believe that they have procedures in place that are based on years of research when it comes to how they manage their inventory but today I noticed that there were some questionable practices – at least for me.

As I was shopping for the patio furniture, I was able to test the options in an area with fully set up floor models. However, almost all the models that were displayed were not in stock on the shelves and the stock on the shelves had poor quality pictures. I was forced to walk back and forth between the show area and the two shelving areas to try to match up pictures with floor models.

Eventually, I had to give up and use my phone to go to the Wal-Mart website and search the boxes on the shelves to determine which one looked good. Overall, they had about 12-15 models set up and about 3 of those were in stock while they had an additional 5 in boxes on the shelf that were not displayed on the floor. Why not display them all or display only 2 or 3 and save the room? It seems like a great oppotunity to save on the labor of setting them up while also leaving more floor space for other items.

Anyways, after making it home and putting the furniture together pretty quickly, I found myself wondering about the manufacturer of the product. Some of the slots that the legs fit into were short and it would have been easier, and more sturdy, had the slots been an inch longer.

Why not add that extra inch I thought to myself? Then I thought about how many slots (4 per table) that would actually work out to and I bet it was hundred of thousands in savings on material by keeping them the size they are. I would love to find out the type of break even analysis that manufacturing companies do on items like that.

They must spend years determining exactly the size, shape and materials that they can use to produce the most cost-effective item without loosing quality or functionality. Then I went to assemble the chairs which came in a second box and notice that they gave me another wrench in that box identical to the one in the box for the table.

You cannot purchase the boxes separately so for some reason they supply you with the same piece twice. It is a heavy-duty wrench that only the Hulk could break so again, what numbers do they crunch to determine that making one piece bigger will cost too much but at the same time adding duplicate tools is costs effective?

These are the things I think of while putting together furniture and shopping at Wal-Mart. What everyday things make you think about the supply chain?

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Responses

  1. […] the everyday things that can reflect the importance of running a business the right way. In my last post I talked about how a simple trip to Wal-Mart reminded me of some supply chain techniques. I cannot […]


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