Question

what is consolidation, break-bulk and contract warehouse means?
Answer on the basis of Walmart company!

Answer 1

Consolidation: Supply chain consolidation is a management strategy that is aimed at reducing the supply chain costs and improve efficiency. Examples of consolidation are supplier consolidation, where the focus is to reduce the suppliers or focusing on the most successful suppliers within a supply market; Warehouse consolidation, where the goal is to reduce cost and increase control over the operations.
Walmart applies supply chain consolidation strategy in its warehouse management. For this Walmart has its own warehouses known as private warehouse. This allows Walmart to decide everything ranging from decisions like storing, processing, security, purchases etc. This also helps the firm to route the products more quickly to its customers.
Break-bulk in Warehousing: It is the process where the products are sorted and split and arranged for specific delivery.
Walmart has specific break-bulk warehouses that cater to inbound transportation truck loads from manufacturing plants. They receive these bulk shipment and then break and split them into smaller shipment for local deliveries. This allows the company to avoid long distances small shipment, which saves time and money to a greater extent.
Contract Warehousing: It is a contract where a partner warehouse agrees to receive, store and deliver the goods to the clients as per specific clause in the contract.
Walmart contract with Schneider Logistics in 2006 is one such example of contract warehousing in which the Logistics company has allowed Walmart full operational control over one of its warehouses. This allowed Walmart to expand its business without worrying about the warehousing space. I recent times, Walmart has many of its owned warehouses where it charges an allowances from suppliers whose products find a place in its warehouse for specific duration.