Mhlnews 1759 Dave Blanchard

Have Yourself a Pepper-Spraying Christmas

Dec. 7, 2011
Black Friday illustrates the new best practice of encouraging out-of-stocks.

Retail giant Walmart figures prominently in the history of supply chain management, having launched numerous initiatives that have had profound impact on the logistics landscape, such as Retail Link, the company’s private exchange for supplier transactions; regional distribution centers; RFID mandates; and more recently, its drive to create sustainability labels for consumer packaged goods. In the wake of Black Friday last month, a new term closely associated with Walmart has entered into the supply chain vocabulary: pepper spray.

On Black Friday (which might as well now be called Thanksgiving Shopping Day since retailers are now opening their stores on Thursday night), violent altercations amongst Walmart shoppers occurred in at least seven different states, with the most highly publicized instance involving a California woman pepper-spraying dozens of fellow shoppers because, apparently, they stood between her and the deeply discounted Microsoft Xbox units she desired.

According to the Los Angeles Times, the pepper-spraying occurred when people started pulling the plastic off pallets of gaming consoles, and then were shoved onto the boxes. Meanwhile, according to a Reuters report, off-duty police officers in North Carolina pepper-sprayed impatient Walmart patrons who attempted to grab electronic gadgets off pallets before the sale had officially commenced. Exactly why shrink-wrapped pallets of products were hauled out onto the retail floor, rather than opened in the backroom and placed on the shelves before the store opened, hasn’t really been explained. Apparently, having unopened pallets on display helps lend the illusion of Black Friday sales being so hot that these products were literally unloaded right off the truck just moments ago.

In any event, it strikes me as more than a little ironic that Walmart’s supply chain proficiency has had a boomerang effect. Rather than burnishing the retailer’s image as being the one place that consistently has its shelves stocked with the products its customers want, the frequency and intensity of Black Friday fracases (and let’s not forget that a Walmart store employee was fatally trampled a few years ago) leave the impression that Walmart shoppers are so paranoid of out-of-stocks that they’ll come to the stores armed with pepper spray to even the odds.

Lest we forget, Walmart pioneered the concept of collaborative planning, forecasting and replenishment back in the mid-1990s. CPFR is a process—largely enabled by technology—that lets supply chain partners share historical data and develop plans to manufacture and distribute a product. Retailers like Walmart, and suppliers like Microsoft, typically use this information to forecast needs, establish and alter promotion timelines, and determine when stock or supplies need to be replenished.

The goal of CPFR is to make it easier for retailers to separate consumers from their cash by always having popular products in stock. Unfortunately, events like Black Friday have created an entirely different scenario that neither CPFR nor any other supply chain management best practice can handle: to systematically coordinate the rationing of products in a set timeframe, while maintaining the idea among consumers that out-of-stocks are not just possible but are absolutely guaranteed to happen.

In terms of the big picture, though, consider this: sales over the Black Friday weekend soared to a record $52 billion, based on National Retail Federation estimates. Given how successful retailers were at goosing sales by jump-starting Black Friday on Thursday night, the one inescapable conclusion we can draw is that the tradition of spending the fourth Thursday of November gathered around the table with family and loved ones, giving thanks for the blessings of the past year, is rapidly fading into antiquity. If Norman Rockwell were alive today, his Thanksgiving Day painting would have to show Grandma passing the pepper spray.

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