Question: The Retail Giant Walmart Is Trying To Compel Its Suppliers To “go Green” As Part Of Its Efforts To Build A More Environmentally Sustainable Global Supply Chain. As It Did With Promoting EDI And RFIDs In The Early Stages Of Those Technologies, Walmart Is Leading The Curve With Its Sustainability Efforts. On An Occasion, Walmart’s CEO, Lee Scott, …
The retail giant Walmart is trying to compel its suppliers to“go green” as part of its efforts to build a more environmentallysustainable global supply chain. As it did with promoting EDI andRFIDs in the early stages of those technologies, Walmart is leadingthe curve with its sustainability efforts. On an occasion,Walmart’s CEO, Lee Scott, told a large gathering in China, “Acompany that cheats on overtime and on the age of its labor, thatdumps its scraps and chemicals into our rivers, that does not payits taxes or honor its contracts—will ultimately cheat on thequality of its products. And cheating on the quality of products isthe same as cheating on customers. We will not tolerate that atWalmart.” As part of this initiative, Walmart will survey its100,000 global suppliers and ultimately create a “sustainabilityproduct index,” which will allow the company to evaluate supplierson their sustainability efforts. Suppliers anxious to keep Walmartas a customer will be motivated to improve their rating on thesustainability index. Some experts think Walmart can change thebusiness climate on sustainability. According to Harvard ProfessorRosabeth Moss Kanter, Walmart’s determination to use itsconsiderable influence to raise the standards for environmentalsustainability “shows that a single company using its unique cloutcan accelerate public action to reduce greenhouse gases and reverseclimate change.” Walmart’s new initiative translates into a newburden on suppliers. By some estimates, the company’s efforts toimprove sustainability could increase the cost of products by 1–3percent, due, in part, to new requirements that suppliers labelproducts with a green index. However, these costs may be offset ifthe suppliers, as part of their efforts to reduce their impact onthe environment, can also improve their supply chainefficiency.
Examine as to whether the consumers will be willing to payincreased prices to ensure that their products are sustainablyproduced and packaged (10 marks)
Length of the answer: Between 275-300 words
Marks distribution of the question is as follows:
Critical examination of the expected consumers’ response: 4
Contextual understanding of the case study: 2