Inventory Proposal Wal-Mart

every(prenominal) smart set, no thing the size deals with document issues. How these issues are dealt with can aimersink the outcome of the comp either. If non done in a rectifiable fashion, the company could face serious threats up to and including closure. We chose Wal-Mart as our company from our demise paper, as it proposes an inte shacking dilemma in that despite the continued growth, alone is non well with Sam Waltons creation. This paper will discuss the entry worrys, the expected benefits that may or may not motivate the transcription for change and our assessment for an alternative resolve.Wal-Mart is growing at a bitter pace adding nearly 500 stores in the past five old age a 13% increase, notwithstanding during this time period Wal-Mart has reduced its employee count by roughly 20,000. This has had a serious impact on the memorandum. Bloomberg produce an article that states that although Wal-Mart has one of the best supply mountain chains in the world, without staffing that chain breaks beat. The company does not have enough workers to help stemma enrolment on shelves, or distribute the inventory to stores. Customers either find stores smell disorganized and unkept, or simply find an empty shelf with no product (Flannelly, 2013).A leak reported to Bloomberg said Bill Simon, the decision eviscerater vice president and chief executive officer for Wal-Marts joined States operation stated during an executive officers meeting that the company has inventory problems. We authorise out quickly and the new stuff doesnt come in, he stated, noting that these self-inflicted wounds were Wal-Marts biggest risk. (Foley, 2013) The issue is the amount of inventory that the current employees can stock is far less than is required to primary(prenominal)tain adequate merchandise levels. A store may have inventory in the back, but if it is not seen by the customer, the store is considered to be out of stock.This poses two major problems for Wal-Mart. The main problem is that this lack of stock is costing Wal-Mart billions in sales and is fundamentally leading customers to competitors. More competitors, ilk Target and Costco, have gained some of the merchandise share away from Wal-Mart it seems as though maintaining good, well-stocked, exceptionally operated stores needs to snuff it a priority for the company (Flannelly, 2013). Another major issue with this problem is that inventory sitting in the back depreciates and every hour it sits is like a leaking faucet.Not only is the product sitting and depreciating, in that location are higher possibilities that the product might be damaged, expire, or simply stick out its market value. Adding insult to injury, customer satisfaction continues to decrease. Due to the lack of manpower Wal-Mart has remained in last place on the American Customer happiness Index for the past six years. Those are staggering comes considering that Wal-Mart is the number one retailer in the world. If this problem is not rectified, Wal-Mart and its world noted inventory system will be six feet under.Shows a even increase in inventory, due either to the increase in locations or The lack of adequate employees to stock merchandise. The graph above indicates that Wal-Mart has the most inventory during the months of October, November, and December. This is probably due to the increase in sales during black Friday and Christmas. This similarly indicates that the amount of inventory during the third quarter is significantly lower than the rest of the year. Gives a more definitive look at the highs and lows in regards to inventory by quarter. Utilizes linear regression to forecast future inventory during any given quarter.The above graphs show inventory to sales over the last three years. We found that although Wal-Mart continues to grow, their sales could be higher. Each year there is a decrease when comparing it directly to inventory. Between 2011 and 2012 the Sales dispa rity was 6% and only 5% between 2012 and 2013. Inventory also has a dip showing an 11% increase between 2011 and 2012 but drops down to 6% between 2012 and 2013. The reason is rather simple. If inventory does not make it to the floor, sales will decrease. As inventory continues to sit, Wal-Mart is essentially bleeding out. manifestly the correct action would be to hire the needed employees to correct this problem, but the costs may be too high to do all at once, not to mention, Wal-Mart feels no need to do such. Our alternative solution would be to hire in increments and implement specialized training that specifically focuses on turning the inventory. All new employees should become subject matter specialist and the training essential be repeated throughout the land (White C. , 2013). While inventory is not the issue, it has become the equation of cause and effect. This must be a priority as the inventory is the life ancestry of the company. No blood, No business.