It amazes me the disconnect between strategists and operators at companies that make grandiose statements about one policy or another only to find that such political campaign-like promises are extremely challenging to implement in practice — or at least to implement and sustain with a limited added cost structure. I’m guessing this will be the case with a recent pronouncement from the world’s largest company, Wal-Mart. Wal-Mart recently announced a new effort to buy more fresh produce locally. On the surface of the non-organic soil, this sounds reasonable enough.
But in reality, we should all question the actual impact that such an effort will really have. And at what cost. Sure, it makes for great CSR marketing to say “we’ll double the percentage of locally sourced produce.” Heck, Wal-Mart may even convince a few Whole Foods shoppers to park their hybrid Lexus SUVS in their parking lot for the first time with lines like that. But in reality, backing up words with action will be difficult in this situation, not to mention potentially costly to the environment.
Consider the following hypothetical situations:
- It’s June of 2012. Walmart is working with local XYZ berry grower. An expected week’s worth of product for five stores gets wiped out because of flooding (e.g., mold on the berries). When Wal-Mart goes to the open market and calls Driscoll, Sun Belle or another distributor/trading company, they must pay a significantly higher price on the spot market (and must also deal with suppliers that previously used to hate doing business with them because of charge-backs and others related reasons)…