Sunday, January 3, 2010

Walmart´s new sourcing strategy: what impact on developing countries?

According to the FT, Walmart just announced that it aims to manage its supply chain on a global basis:

"Walmart is launching a drive this year to cut billions of dollars of costs from its supply chain by combining its store purchasing across national frontiers in a new stage in the globalisation of its business.

The effort is part of plans by the world’s largest retailer to increase the proportion of goods that it buys directly from manufacturers, rather than through third-party procurement companies or suppliers."

This could contribute to further alter the opportunities for many developing countries as Walmart increases its bargaining power over domestic suppliers all around the world. At the end, then, the crisis may accelerate the concentration of lead firms in many sectors and further reduce value added in Central America and other regions of the developing world.

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