Wal-Mart Packaging Push Saved $3.5 Million

A senior Wal-Mart executive said Monday a drive to cut packaging on toys saved the retailer some $3.5 million in transportation costs last Christmas, a major gain to the bottom line the company won from its sustainability initiative.

The slimmer packaging, in some cases amounting to as little as a one-inch reduction in the cardboard that houses individual toys bound from Asian factories to the United States, added up to 727 fewer ocean containers for the retailing giant. The company also saved 1,300 barrels of oil.

"Our goal is to be better for the environment and to save money," Gary Maxwell, senior vice president of international supply chain at Wal-Mart Stores, told the annual meeting of the Council of Supply Chain Management Professionals in Chicago.

Launched by Lee Scott when he was chairman of the world’s largest retailer, the Wal-Mart sustainability program has taken in virtually all aspects of the company's sprawling business, including direct transportation operations such as trucking and logistics-focused operations such as warehousing and distribution. "He told us that he wants everything to be cost neutral, but what we really want is to save money," Maxwell said.

The figures on ocean containers amount to a tiny share of the boxes Wal-Mart, the United States' largest importer, brings into the country but also reverberate across the supply chain, creating fewer truck trips to distribution centers and stores.

The company is developing what it calls a "sustainability index" to measure the impact of its goods on the environment and Maxwell said he expects that index to be released soon.

Wal-Mart was the top-ranked importer on The Journal of Commerce Top 100 Importers for 2008 with 720,000 TEUs, some 60 percent more than No. 2 importer Target.