Former Amazon VP of operations Arthur Valdez has joined Target and its efforts to revamp its supply chain logistics. He will be EVP, chief supply chain and logistics officer and report to COO John Mulligan.
Valdez, who spent 16 years with Amazon after also working at Wal-Mart and Kmart, begins at Target on Mar. 28.
Target has instituted incentives and omni-channel efforts, which has boosted its e-commerce sales but has also led to empty shelves in stores.
E-commerce is a complex and expensive proposition when it comes to fulfillment. It’s not going unnoticed that Target is turning to a veteran of e-commerce retail’s arguably most efficient mover of goods.
Brick-and-mortar shoppers—pre-omni-channel, anyway—move products off the shelves and essentially fulfill their orders themselves. To ship a package, retailers must move goods onto shelves, off of shelves, into boxes and away, said Nick Egelanian, president of retail development consultants SiteWorks International.
“Selling on the Internet is expensive... the handling and the postage—and you’re talking about basic goods here where the margins are wafer-thin,” Egelanian told Retail Dive, adding "Amazon's not profitable" when it comes to e-commerce.
Still, Egelanian says, retailers these days have to be where the customer is—online, on mobile, and in stores—and the result of those efforts can’t be empty shelves.
“While we’ve made significant progress in improving our operations, Target’s growth hinges on our ability to enhance the fundamental aspects of our business, starting with the supply chain,” Mulligan said in a statement about the Valdez hire. “Arthur’s leadership and experience will be a tremendous asset as we continue to drive improvements in end-to-end processes, including leveraging our almost 1,800 stores to deliver a seamless experience for our guests.”