Treasury Today Country Profiles in association with Citi

Walmart

Best Working Capital Management Solution Highly Commended: Walmart

Chris Jameson, Bank of America Merrill Lynch collects the award on behalf of Walmart

Walmart has installed cash recycler machines across all of its 4,700 US stores, including obtaining provisional credit from all banks for the cash that is in the machines.

Photo of Chris Jameson, Bank of America Merrill Lynch collects the award on behalf of Walmart.

Matt Allen

Assistant Treasurer

View biography

What started small, with a single discount store and the simple idea of selling more for less, has grown over the last 50 years into the largest retailer in the world. Each week, over 260m customers and members visit their 11,695 stores under 59 banners in 28 countries and e-commerce websites in 11 countries. With fiscal year 2017 revenue of US$485.9bn, Walmart employs approximately 2.3m associates worldwide.

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Number one ranked Fortune 500 company frees ‘trapped cash’ with recycling solution

The challenge

Historically, every coin and note that came in and out of the stores was manually counted multiple times. Matt Allen, Assistant Treasurer explains, “Our objectives were quite simple really, we wanted to move the company from a traditional model with physical money being delivered and collected, to a more automated relationship where funds clear as they enter the machine in the store.”

The solution

Walmart has installed cash recycler machines across all of its 4,700 US stores, including obtaining provisional credit from all banks for the cash that is in the machines. This innovative approach allows Walmart to significantly streamline its cash management process while also reducing its working capital by many hundreds of millions of dollars. Allen comments, “Walmart is now the largest user of cash recyclers worldwide.”

The recycler technology can count 3,300 coins per minute and seven to 14 notes per second. Thanks to cash recyclers all manual counting has been removed from stores. This generated significant time savings and enhanced accuracy and now allows Walmart employees to spend more time in customer-facing roles rather than counting money in the back office. Recycled cash can be utilised in the store, as required, with all transactions tracked by register and denomination. Additionally, the enhanced control environment has allowed Walmart to reduce fraud risk.

Best practice and innovation

Walmart worked closely with Bank of America Merrill Lynch (BofAML), who has a strategic relationship with G4S Retail Cash Solutions, to introduce the Bank’s CASH3601 service. They designed this solution to maximise working capital efficiency and implemented the bank-owned cash model, which has never been adopted before in the industry. This innovative approach completely revolutionised Walmart’s interaction with banks.

Additionally, this has changed Walmart’s relationship with its armoured carrier partners in support of this product and their engagement with the device.

“Winning a prestigious Adam Smith Award is a great accolade that I am proud of. It is also a testament to the great work in cash management innovation our cross functional team is leading.”

Walmart has completely overhauled its entire depository banking process while successfully partnering with banks and carriers to adopt this new product and process. Recycler machines are live in all of the company’s US stores, with all cash in the machine owned by the bank. Change orders are handled by a centralised team and driven by algorithms to fully accommodate actual usage and seasonality through the week, month and seasons. The control environment in the cash office is significantly enhanced, allowing Walmart to reduce hours in non-customer facing roles.

Allen concludes, “Historically, it took days to get cash out of our stores and credit for their deposit but now it is a same-day process.”

  1. CASH360 is an end-to-end cash handling solution that includes the hardware – a cash recycler device – software, service, maintenance and transportation. The service allows deposits and withdrawals of cash from the recycler, allowing Walmart to reduce or even eliminate in-store cash processing tasks that can be highly labour-intensive. Additionally, the recycler has robust security features that can dissuade unauthorised access.

Key benefits

  • Significant working capital benefits.

  • Faster access to hundreds of millions of dollars in ‘trapped cash’.

  • Accelerated deposit credits.

  • Decreased fraud.

  • Increased automation.

  • Process efficiencies.

Portrait of Matt Allen

Matt Allen

Assistant Treasurer

As Corporate Vice President and Assistant Treasurer, Matt Allen leads the teams responsible for managing Walmart’s worldwide capital markets, cash management and trade activities. He oversees the company’s $50bn short- and long-term debt portfolios, revolving credit facilities, bank and rating agency relationships. Prior to joining Walmart, Matt most recently worked at IMG Worldwide, Inc. He also held global finance roles at IAC and Microsoft.

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