Cyber Monday Sale! 50% Off All Access

An Inside Look At Being a Wal-Mart Supplier What does it really take to service Wal-Mart as an account? A new report provides a rare, behind-the-scenes view into the inner workings of the big-box giant.

By Carol Tice Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

An Inside Look At Being a Wal-Mart SupplierIt's the dream of many manufacturers to get their products onto the shelves of a major retailer. And there's no retailer bigger than the Bentonville, Ark., behemoth: Wal-Mart.

What does it really take to service Wal-Mart as an account? A fascinating report from RetailingToday.com's Wal-Mart-focused package "Connecting Northwest Arkansas," which surveyed Wal-Mart suppliers, provides a rare look inside the companies who've won a spot in the retailer's wide aisles.

First thing to know: New suppliers are few. Just 4.2 percent reported they have been with Wal-Mart less than two years. Nearly half had been Wal-Mart suppliers for 12 years or more.

Another interesting tidbit: Most suppliers have dedicated employees on the ground in Arkansas, serving Wal-Mart up-close and personal. Nearly half have fewer than five people stationed there, but 10 percent have more than 50 people on the payroll in the region. More than one-third expect to allocate more resources for servicing Wal-Mart next year.

Still, Wal-Mart has struggled to retain market share since the downturn. Where are the big-box retailer's biggest competitive threats? The suppliers' top answer is dollar stores, followed by Target and Amazon.com.

Suppliers are happy about one trend at Wal-Mart -- after earning customer ire for stripping down its inventory, the retailer added 10,000 items back in the past year. So that's more opportunity for suppliers. But the retailer got only mediocre grades when suppliers were asked if the new-item introduction process at Wal-Mart is easily understood and efficient.

Suppliers said merchandise decision-makers were accessible and interested in their ideas. If you want to pitch Wal-Mart, don't expect a quick decision, though. The retailer got the lowest marks of the survey on a question about speed of execution.

Back when I used to cover the National Hardware Show, I got to know a lot of suppliers to big-box stores. I learned that supplying a huge account is risky business. The big retailers demand low-low prices from vendors -- and each year, they want a lower one.

You have to ramp up production to meet their needs, and drop other clients to focus on serving them. Then, if the big retailer discontinues your products, it can bankrupt a small business -- or even a medium-sized one. My take: Proceed with caution.

Would you like to be a Wal-Mart supplier? Leave a comment and let us know why -- or why not.

Carol Tice

Owner of Make a Living Writing

Longtime Seattle business writer Carol Tice has written for Entrepreneur, Forbes, Delta Sky and many more. She writes the award-winning Make a Living Writing blog. Her new ebook for Oberlo is Crowdfunding for Entrepreneurs.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Business News

There Are Certain Words That Will Break ChatGPT. I Tried Them — Here's What Happened.

ChatGPT appears to be unable to process requests that contain a few notable names.

Business Plans

'Irrelevance Is Worse Than Death': How This CEO's Competitive Drive Resulted in a Global Powerhouse AI Startup

From a sports-centric childhood in Boston to leading the global AI startup SuperNormal, Colin Treseler's journey is a masterclass in persistence, adaptability, and the art of using time wisely.

Business News

'Subject to Apple's All-Seeing Eye': An Apple Manager Is Accusing the Tech Giant of Spying on Employees, According to a New Lawsuit

The employee alleges that Apple can conduct physical, video, and electronic surveillance of employees, even when they're off the clock.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

Tesla Cybertruck Factory Workers Reportedly Told 'You Do Not Need to Report to Work' for 3 Days This Week

According to a memo first viewed by Business Insider, Tesla factory workers in Austin were reportedly told to stay home Tuesday through Thursday.