Roughly what percentage of rail freight is Walmart?

[greyhounds]

Here's the Walmart distribution network A to Z.

http://www.mwpvl.com/html/walmart.html

One of the keys to Walmart's success has been its logistics efficiency.  They keep the products moving until the retail customer goes through check out.  

[schlimm]

My understanding of Wal-Mart's problems is (in no particular order): 1. Customer dissatisfaction with messy stores and too few checkout clerks.  This in turn stems from diffficulty in hiring and retaining good personnel (in the stores) because of low wages.   2. Marketing confusion.  3. The ongoing decline in disposable income by their primary customer base. 4. Market saturation.

[Vern Moore]

Incoming Walmart freight is increasingly via container from port to distribution center (DC).  When I first started in trucking, I noticed zero containers at the Walmart DCs I'd deliver to.

In my last year before heallth issues stopped me from driving, probably 25% of their inbound freight was containerized and some DCs were at higher percentages.  Not surprising those DCs with higher container usage were in the northeast and Florida, where getting outbound loads was more difficult than other areas of the country.

Target is another retailer with a high utilization of containerized freight going into their distribution centers.  And if you look at the location of Target's newest DCs, they are all close to major rail intermodal facilities, which allows the drayage companies to maximize the numbers of loads delivered by a driver in a workday.

[Wizlish]

I think the original post isn't about "Wal-Mart" internal logistics at all, it's mostly concerned with the traffic between ship terminals and wherever the containers are stripped of their 'oriental' bulk stock and apportioned as needed to the DCs.  I do not know the percentage of IM traffic in different lanes that this involves, or how it would be reduced on a container-per-train basis for various lanes -- but there will be people reading this who do know.

3 of the local WalMarts in the Memphis area use containers for additional stock storage during holiday times.  I do not know if these are 'rented' only as storage space or actually contain some mix of items shipped directly from overseas.  I suspect the former.

The essence of the WalMart stocking model is that the POS system continually tracks the SKUs and prepares the necessary shipment makeup from the DCs.  All these shipments will be via standardized truck (hence WalMart's interest in hybrid tractors and other forms of reducing pure-truck shipment cost over roads).

Likewise, as noted, most of the DCs themselves do not have direct rail access (and would need a reasonable subset of the equipment used at an intermodal terminal to access a stack train directly, if they did).  I do not know whether the containers from the Far East make it as far as the DCs to be stripped, but if they did it makes sense for them to be on chassis with appropriate height, level, etc. to be docked same as vans.  Many of the container chassis I see around here (one of the predominant markets for distribution centers) do not have those characteristics.

 

One of the great points of Sam Walton's management model is to standardize execution and minimize unnecessary capital cost.  (Equally great is the idea of throwing money at places that produce greater economies or performance, notably POS technology in earlier years, but that's a separate concern here.)  That heavily favors 'trucks everywhere' (especially where the company actually owns the trucks; compare this with the old Post Office intercity model where you'd see the saddest cheapest-bidder folks with the city-pairs daubed on their ancient trailers...).

Now, with increased fuel cost I'd expect to see increased use of TOFC ... if the overall cost, net of tractor and driver allocation etc., is in fact lower consistently, and QoS to assure the necessary close-to-just-in-time deliveries to or between DCs and to stores is adequate.

While I don't think much of the post-Sam management of the Wal-Mart enterprise (among other things, the smaller-grocery model would have been a whole separate line of profitability done right) it does have to be said that in many ways common sense would run that company at 90% efficiency or better, just with the policies and procedures formalized when Sam determined what to do.  It doesn't take much more than operational common sense to determine the participation of rail in any part of how Wal-Mart does logistics ... or to 'correct' it without much latency when conditions change.  (And if more folks in 'the family' took an interest in common sense instead of the ways they do things now, there would be fewer observed problems in execution... but that's another issue.)

[Firelock76]

Not much point in bringing up Sam Walton now, he's been dead 23 years.  What he'd do now versus what he did then is anyone's guess.

Considering how Walton insisted on stocking his stores with American-made products it's ironic how Wal-Mart (among others) has become a retail outlet for Chinese made goods.  Would Walton have gone for that?  Who knows?

[CMStPnP]

ROBERT WILLISON

Its way to soon to count wal mart out. But wal mart like all if its us competitors imports a good portion of its inventory from the far east. These arrive in containers and shipped East. I have also seen Walmart 53' trailers on fec intermodal trains in the past. I don't know how many  if any wal mart DC's have have rail sidings.

The DC next to Corporate HQ (Bentonville, AR) has no tracks and is wall to wall Walmart trucks, have not seen so many trucks parked or docking under one ownership emblem.......anywhere else in the country.

My guess is they favor trucking exclusively because it is faster and more flexible and well........they own the trucking service outright.

Sure am glad I only work there occassionally as a contractor, that Corporate HQ is largely windowless and they used the same building materials, paint, etc they use to build a local Walmart.........it has the of effect working in a very large Walmart.    It is mostly designed as a people warehouse with no real common areas to relax or enjoy oneself.     I understand Sam Walton wanting to economize but he did so at the expense of employee retention in the areas where Walmart could really use smarter people to run it.

[ROBERT WILLISON]

Its way to soon to count wal mart out. But wal mart like all if its us competitors imports a good portion of its inventory from the far east. These arrive in containers and shipped East.

I have also seen Walmart 53' trailers on fec intermodal trains in the past. I don't know how many  if any wal mart DC's have have rail sidings.

[Ulrich]

Walmart seems to be facing some serious headwinds with rising wages and increased competition from internet retailers. Will be interesting to see how the retailer's woes affect the rails over the next year or two.