Your point is a good one, Lilian! I think that reducing food waste is a two-pronged approach that relies (1) on improving technologies and (2) on using WM’s prominence to change the supply and demand dynamics. But the company needs to be careful before it gets into social impact marketing campaigns or selling more bruised fruit because, without the demand for these products, it will be hard for WM to change its supply base. I’m not sure it’s WM’s job to promote bruised fruit. Consumers in emerging markets have been trained by the USDA and FDA regulations that “questionable” food should be thrown out and those regulations are often put in place because of lobbyists from very influential food packers and producers.
Very much agree with your food security point Hannah. At the end of the day, it’s up to both the food suppliers (e.g., General Mills) and food retailers to reduce food insecurity. What may also be important for Walmart is to understand where there are food deserts and how to strategically place the company’s neighborhood markets so that low-income customers can be served with low cost food.
Very good point Satoshi! WM cannot get bogged down by trying to use technology to only reduce food waste, but if WM can be convinced that tech will not only help reduce food waste, but also improve food sourcing efficiency and lower cost to mantain the supply chain, the company will be more incentivized to use technological improvements.
Re: Amazon’s strategic move to purchase Whole Foods, here’s actually a good video by Jim Cramer explaining why WM still has a competitive advantage (https://finance.yahoo.com/video/cramer-why-amazons-no-1-230800393.html?soc_src=community&soc_trk=fb).
Agreed Lily! Christina’s piece also mentions the ability to affect climate change and reduce climate emissions, which is equally as important.
Good point Sam! WM can start with 1-2 major suppliers and see how things go. It also might make sense to focus on a couple of neighborhood markets as test centers.
Super interesting point about the decreased demand for suppliers’ products if WM decreases food waste! I did not think of that and agree that it’s in WM’s best interest to assuage suppliers’ concerns about reduced demand.
Cool topic! I’ve always been interested in learning how Netflix uses data to predict content production. However, I wonder how much of content production is art vs. science and what Netflix’s competitors (mainly Amazon Video, HBO NOW) are considering when it comes to production and scaling. Richard Plepler, CEO of HBO, has recently stated (https://www.bloomberg.com/news/features/2017-11-21/hbo-ceo-richard-plepler-on-growth-sexual-harassment-and-life-after-game-of-thrones) that in addition to a multilateral distribution strategy, HBO really focuses on its core values about the creative process. They constantly think about the unique content they can produce and trust the artists’ voices, enabling them to make killer shows such as Veep, Game of Thrones, Silicon Valley, and Girls. No amount of data could predict that dragons would become the next big thing 🙂
Thanks for writing about food waste reduction! I agree it’s a big problem and especially relevant for large-scale suppliers such as Barilla. Aside from the many wonderful things that Barilla is already doing to reduce waste and make its supply chain more efficient, I also recommend that Barilla and other food manufacturers work with large-scale retailers to implement these complex technologies. For example, Walmart has taken the lead in investing with IBM and implementing blockchain to track the food supply chain from farm to market. In order for this work, Walmart needs to have buy-in from suppliers such as Barilla because Barilla manages the upstream process while Walmart has less control in this space. I would love to see a distinct pilot between Barilla and Walmart on how all these digitization techniques have decreased food waste from pre- to post-consumer and that could serve as a key case study to convince other suppliers to buy into incorporating digitization in the food supply chain.
Interesting problem to explore for UPS! I personally think that UPS will be less affected than other companies from isolationism because UPS will not have to directly deal with import and export restrictions since these restrictions are often placed on value of goods rather than the 3rd parties that transport, especially since I view UPS as a consumer-focused business versus B2B (most B2B supplier to retailer packages are shipped through large truckloads domestically or by sea freight overseas and your chart of UPS revenue/profit split by type of transport supports that). Nevertheless, this is still a problem that the company must be aware of and act proactively.
Interesting article! I agree with the options that you’ve proposed for the company to take charge of controlling its raw coffee bean inputs. Another thing Starbucks can do is to become the leader in predicting where coffee beans will have the greatest yields and production by using coffee yield models on an annual basis. Similar to the crop yield modeling techniques your cited article Bunn et al. has used, predicting coffee yields requires Starbucks to have multiple data inputs (weather, agronomic, soil, past production, and yield) to determine annual harvests. If Starbucks can do this a year before the harvest, then they can get better at choosing where to invest in new coffee bean farms and de-risk its investments.
Cool subject! Would never have thought that L’Oreal would be interested in combating climate change. I am a bit concerned that the cosmetic products are using petrochemicals, especially if we are using them on our faces 🙂 I applaud the company’s efforts to build more sustainability in its supply chain. However, won’t these reformulation changes increase prices for L’Oreal’s products? The company’s mainstream products are often on the cheaper side of the cosmetics spectrum. Products that use more natural ingredients are often priced higher and consumers are willing to pay higher prices because they know that the brand stands for sustainability (e.g., Origins, Aveda). Will consumers know about the change, aside from L’Oreal’s namesake organics brand (The Body Shop)?
Super interesting and didn’t know that Gildan was a Canadian company! I wonder if Gildan would be open to a partnership with a company like Li & Fung to help address these concerns. Since Gildan primarily does apparel and owns its manufacturing facilities, it may seem that the natural supply chain play for the company is to increase vertical supply chain integration, but working with a trader and outside vendor may also decrease risk. Gildan probably views Li & Fung as a competitor because of the similarities of the work they do so it may take the executive management some convincing to allow for a partnership.