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Wal-Mart to Initiate Audits of U.S. Third-Party Distribution Facilities

Your own business operations might be squeaky-clean, but that doesn’t mean you’ll escape the damage caused by labor violations or the economic impact that bad press will bring. In today’s business world, consumers don’t just look at the small piece your company plays in the overall manufacturing and selling of a product – they look at the entirety of your supply chain to determine if what they are buying meets with the highest levels of societal and ecological responsibility. According to this article by Bob Ferrari, this increase in consumer awareness is driving business to respond. It’s this consumer awareness that has driven Wal-Mart to audit third-part logistics (3PL) partners due to claims of unhealthy and unreasonable working conditions. What makes the situation even more confusing is that some of the 3PL vendors Wal-Mart engages also use outside vendors to supply employees. So who’s responsibility is it to fix alleged wrongs; and who should take the blame? According to Wal-Mart, it’s not them: Wal-Mart has argued that many of the labor rights violation allegations should have been directly focused toward the 3PL logistics firms which hold existing Wal-Mart contracts. It would now appear that this argument is not holding water with regulators, hence this new announcement of a third-party auditing process. The auditing process is characterized as including unannounced auditor visits to all third-party warehousing and distribution facilities. The problem stems, according the Wall Street Journal article that Ferarri cites, from companies turning a blind eye to the practices of its 3PL vendors. While this wasn’t a big deal in the past, it certainly has come to represent a make-or-break situation for many companies now – and shows no sign of going back off the radar. For supply chains to provide the best and most wanted services for customers, they will need to be accountable for not only their own actions, but the actions of their vendors and partners.

About Matthew Kabik

Matthew Kabik is the former Editor of Computer Aid's Accelerating IT Success. He worked at Computer Aid, Inc. from 2008 to 2014 in the Harrisburg offices, where he was a copywriter, swordsman, social media consultant, and trainer before moving into editorial.

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