TABLE OF CONTENTS Adversarial. That is the best way to characterize Wal-Mart and Procter & Gamble's relationship in the late 1980s. Every time founder Sam Walton and Wal-Mart executives met with Procter & Gamble's executives, it was like the meeting of two gorillas, both trying to position themselves as the dominant partner to control the ultimate decision.
The relationship deteriorated to the point that Walton and executives from Procter & Gamble decided to intervene. They scheduled a meeting with executives from both companies. The purpose of the meeting was for the companies to determine how to forge a new relationship based on leveraging their individual strengths.
Robert Bruce, former Vice President of Wal-Mart's Inventory Management and Supply Chain, characterizes the meeting as a turning point for both companies. As it turned out, it was a turning point for the retail industry as well. This meeting was the start of supply chain collaboration as we know it today and was the genesis of a new business model for the retail industry.
Bruce remembers how Walton finally convinced both parties to stop feuding and start cooperating. Walton observed that Wal-Mart was in the business of merchandising and selling products to the end consumer, and Procter & Gamble was in the business of manufacturing and shipping the right products to sell to Wal-Mart. Walton told the group, "Why don't we just work together and get the job done in the most efficient way possible? It's simple. You ship us product and we'll send you money."
