Investor Presentaiton
REGARDING CHALLENGES
CONCERNING OUR SUPPLIERS
We have worked on:
1. Maintaining constant and open dialogue with our suppliers, through
different channels:
a. The Supplier Advisory Board. Created in 2006, it consists of 14 countries
in Mexico and Central America, and it is an opportunity to exchange
ideas and foster best practices that increase the competitiveness of our
companies.
b. The Supplier Survey. This is an annual evaluation mechanism with
representation from large, small and medium-sized companies. It
evaluates the Walmart way of operating regarding its relations with
suppliers, and allows for identification of key points when increasing
efficiencies. The representation of SMEs this year was 27%.
c. Supplier and Ethical hotlines. Run by independent merchandising areas,
suppliers can communicate problems they are facing, make specific
suggestions, or file complaints regarding non-compliance with the
company's ethical standards.
d. Dialogue with suppliers of perishable products. Sessions are held with 450
small, medium and large-sized suppliers to identify areas of opportunity
and new ways of working.
2. Strengthening the structure of Merchandising. Centralized Negotiations for
GM, groceries, consumables, and Apparel in Self-service, regional buyers, and
buyers for perishable categories at the national level. This allows them to
develop a more strategic vision, develop products and improve the capacity
to respond to customer needs. The Merchant Academy strengthens their
training and development.
3. Ensuring quality standards and compliance regarding the products we
sell. This is done through a quality and compliance verification process
that ensures food safety, the origin of raw materials, and compliance with
applicable legislation. We verify that 100% of our private label suppliers have
currently audits, in addition to the suppliers of raw materials for processing in
our stores and production centers are audited regarding the following:
Good Manufacturing Practices
Quality Systems
Process Control
Training
Pest Control
Facilities
Hazard Analysis and Control over Critical Points
Said verification processes are based on the following criteria:
Perishables. Statistically representative product-quality inspections were
performed on deliveries of perishables in Distribution Centers, as per product
features concerning weight, temperature, and overall specifications. The
inspection sample is taken statistically and action plans are established with
suppliers. In addition, in Mexico we purchase 100% top quality, TIF-certified meat.
Food Products. In Mexico, 79% of private label suppliers and in Central
America, 7% of suppliers who outsource finished product in the Agroindustrial
Development plants are certified through the global Food Safety Initiative,
which is fostered by the business sector to achieve ongoing improvement of
food security management systems, increased consumer confidence, and a
guarantee of the availability of safe food products. Walmart requests that its
private label suppliers obtain certification from any of the systems recognized
by this initiative (SQF, BRC, FSSC 22000, Global GAP, IFS, among others),
once they have passed a Good Manufacturing Practices audit and prove the
implementation of HACCP (Hazard Analysis and Critical Control Points). The
number of certified suppliers varies each year in terms of the needs of the
business and the company's commercial requirements.
2013 Financial and
Social Responsibility Report
43
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