The first indication that something big was brewing with Walmart on the domestic sourcing front came last week.
That’s when Walmart announced internally at that SVP of home, Michelle Gloeckler, would assume additional responsibilities for a new U.S. sourcing and manufacturing initiative. Reporting to Gloeckler is Greg Hall who was named vp of U.S. sourcing and manufacturing after previously serving as vp of marketing for Walmart.com.
Both appointments were a little lost in the shuffle as the new responsibilities for Gloeckler and Hall were listed at the bottom of a memo that included announcements about 15 other merchandising executives. They aren’t lost in the shuffle anymore following the announcement earlier this week by Walmart U.S. president and CEO Bill Simon that Walmart plans to purchase an additional $50 billion worth of merchandise from U.S. suppliers during the next five years.
Gloeckler and Hall now figure prominently into those plans and accompanied Simon to the National Retail Federation convention where he was a featured speaker on Tuesday morning when the purchasing initiative was announced in front of several thousand people.
"Walmart and Sam’s Club will grow U.S. manufacturing on two fronts: by increasing what we already buy here – in categories like sporting goods, apparel basics, storage products, games, and paper products. And by helping on-shore U.S. production in high potential areas like textiles, furniture, pet supplies, some outdoor categories, and higher end appliances," Simon said.
He indicated the company will help convene a manufacturing summit this summer to bring the retail industry together and promote domestic sourcing more broadly.
"Instead of working on these issues separately, we will accelerate these changes by working together," Simon told the NRF attendees. "And when we do, it will benefit all of us. Any new factory can sell to any of us. Every investment made in partnership with one of us lowers the cost for all of us. Every new hire at one of our suppliers is a new customer who might come through your doors or ours."
While Walmart has committed to $50 billion in new domestic manufacturing, he suggested the broader retail industry could set its sights at $500 billion in purchases over a 10 year period. Such a commitment would give American manufacturers the confidence they need to invest in domestic manufacturing at a time when rising energy costs and overseas labor rates are causing suppliers to give domestic manufacturing a second look.
Simon contends suppliers just need a nudge. So in addition to the $50 billion commitment, Walmart plans to execute longer term purchase agreements to give company’s greater visibility into demand for their goods.