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Retail Link and the Kansas City Royals

kcroyalsTyler Drenon wrote an article about the Kansas City Royals last week that — surprisingly — included some thoughts on Retail Link. The connection is David Glass, currently the owner of the Royals but formerly Sam Walton’s right hand man. Glass was a leader at Walmart during the time that Retail Link was developed.

Retail Link is one of the many reasons that Walmart has become the largest and most important retailer in the world — or, as Drenon put it, a “supermassive black hole… gorging its paralyzed competition as a miasmatic hurricane of subordination.”

Drenon seems to have a little trouble with the language, but is certainly capable of conveying emotion in spite of grammar problems.

Drenon’s article was actually about Glass’s management of the Royals, but he spent a couple of paragraphs lambasting Retail Link in colorful terms, and with emphasis:

From its $4 billion birth in 1985, Retail Link has used the bar code system to monitor trends and, more importantly, dominate nearly the entire capacity of retail consumer data. After developing this information, Glass and Walton offered it to their suppliers for free. Therein lies the evil genius. Once suppliers were allowed to plug into Retail Link, Retail Link plugged them right back. Wal-Mart then had access to these suppliers’ books. This gave them the power to control price, volume, quantity, nearly every aspect of the supplier-retailer relationship. Including profit margins … No more negotiation. Just dominance. tweet

Retail Link isn’t familiar to the general populace, so it’s possible that many ordinary readers will walk away from that article with the idea that Retail Link — especially since it is available to suppliers for free — is an example of evil genius. Suppliers probably find it as funny as we do. For the benefit of any new or potential supplers reading, though, we’d like to debunk this paragraph.

Let’s deal first with the obvious false statement, “Wal-Mart then had access to these suppliers’ books.” Walmart doesn’t have access to suppliers’ books. Retail Link provides information only about sales in Walmart and Sam’s Club stores.

What about the rest of the claims? Retail Link is available for free, it’s true. It gives Walmart and suppliers alike access to a lot of data. It uses bar codes. Evil genius? Not so much.

Retail Link was initially built so that Walmart buyers and employees could better understand how products performed, by using a bar code to track sales.  It has grown since those early days, and now can be thought of as a one-stop shop for effective business management, for Walmart and for suppliers.

The forecasting capabilities enable Walmart to ensure that product is on the shelf when consumers want to shop.  Retail link has tools that help suppliers and Walmart alike to understand where merchandise is in the logistics pipeline between the supplier and the store shelf, as well as details on product sales.

Retail Link also collects information about customer behavior in Walmart stores, and provides that information in the form of Market Basket reports. Store of the Community reports help suppliers make sure their products are in the stores where customers want to buy them. These analytics help suppliers and consumers as well as Walmart.

Retail Link’s goal is simple: having the right product in the right stores at the right time in the right quantities.  Retail Link makes suppliers partners with Walmart in the process of growing their sales and is a crucial element to success at Walmart.  For those suppliers who take the time to become adept in using Retail Link, it provides a level of insight into their business that used to be available only to the largest companies and at a very hefty price.

So the reality of Retail Link doesn’t have the science fiction glamor of a “miasmatic hurricane of subordination,” but it does have a lot of power in the right hands. 8th & Walton training can make sure that your company gets the benefits of Retail Link. Download our course catalog to see all the options.

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