Walmart gives back room inventory top-shelf treatment

Dive Brief:

Walmart is testing a new inventory management program called Top Stock, under which large amounts of back stock inventory will soon move from back rooms to the top shelves of aisles on the sales floor, according to a recent company blog post.
By keeping additional merchandise closer to where it’s sold in stores, Walmart can maintain fuller shelves while maintaining more accurate information on inventory, Cristy Brooks, Walmart senior director of innovations development, wrote in the blog post.
The program also allows individual Walmart stores to get more of their associates out on the sales floor for longer periods, and frees up back room space in those stores for other purposes, such as job training and team-building activities.

Dive Insight:

Bloated inventories have been an on-and-off problem for department stores over the years. And an inventory management system is a pretty obvious way to keep stock from piling up in the back rooms of stores. Such tools can also help get products out on the floor where they can be seen by customers and increase the likeliness of a purchase. While Walmart isn't reinventing the wheel with ideas to streamline inventory, there is more to this program than keeping its back rooms clear and clean.

In at least one case, a Walmart store has cleared out enough back room space to put the area to another good use. At a store in Morrisville, N.C. the Top Stock program led to a 75% reduction in back room inventory over two months. That store used the new freed up space for a Walmart Academy associate training program, according to the company blog post.

Brooks, who spent the first 12 years of her three-decade career with Walmart in replenishment and supply chain roles, also noted in her post that pushing more inventory out to the sales floor can make it easier for individual stores to implement programs like same-day online grocery pick-up as more of its stores take on aspects of an order fulfillment center.

Perhaps the bottom line here is that less inventory sitting in a back room out of sight means that more store associates will spend more time on the sales floor, too, within sight of customers who might need their assistance, rather than hunting around for a product in the back room. This program may not exactly be an innovation — just common sense.