America's No. 1 financial conglomerate

Chapter 451 Undermining Walmart

At a members-only golf course in Los Angeles, Ernst sat under a parasol, stirring his coffee while gazing at the distant golf course, seemingly admiring the course.

However, if someone observes closely, they can see that his eyes are unfocused and he is clearly thinking about something.

He had already handed over the matter of Casey Defense to Allen to handle entirely. Casey Defense might not care about its reputation, but he couldn't afford to give Allen any leverage over it.

If something really goes wrong, they can easily deny everything and claim that it's all the fault of those in power at Cass Defense, that they were completely unaware of the situation, and that they were victims who were kept in the dark.

Just as he was pondering, a faint sound of an electric motor approached from afar, gradually breaking the surrounding tranquility and pulling him back to reality from his deep thought.

He stopped stirring his coffee, turned his head slightly, and saw a white sightseeing vehicle slowly driving along the stone path beside the lawn, finally stopping steadily about ten steps away from his table.

Seeing the two men get out of the car, Ernst gave a standard smile and got up to greet them.

"I'm sorry, Mr. Garfield, I'm late." The man who got out of the car first walked up to Ernst, nodded slightly, and spoke first with obvious apology in his tone.

At this moment, Affili Scott, who had gotten off the bus later, also walked up to the two men. He glanced at the man next to him, then turned to Ernst and explained, "The airline was not only late, but they also lost his suitcase."

Ernst's smile remained unchanged as he extended his right hand and shook hands firmly with the other person. "This is America."

He said with a hint of sarcasm, "Those damn airlines never think about how to improve service quality, they always think about how to increase the ticket price by a few dollars."

After a few brief pleasantries, he turned to the side and gestured invitingly, "Let's sit down over there and talk. The environment here is quite nice."

After the three of them were seated, Ens looked at the man who had gotten out of the car first and asked gently, "What would you like to drink? The Blue Mountain coffee here is very good, with a rich flavor and strong aroma. I think you should try it."

"I'm not that picky about coffee, Mr. Garfield." The other man nodded slightly, his tone humble yet dignified, his eyes firm, his demeanor composed, and his every move exuding the air of a seasoned general.

"Ernst, that's what my friends call me." He then waved, and a waiter standing not far away quickly came over.

"Three cups of Blue Mountain coffee, thank you."

After the waiter left, Ernst's smile faded slightly, and his gaze became more focused. "Mr. Dahlzel, Walmart's satellite logistics system is a miracle in the entire retail industry, but don't you think it's a bit of a waste that such an advanced logistics system is simply trapped in the operation of physical stores?"

Howard Dahlzel, one of the vice presidents of Walmart's warehousing and logistics division, is primarily responsible for connecting resources and technologies from the technology industry. For example, the development and optimization of Walmart's widely used satellite logistics system and inventory management software are all within his purview.

His trip to California was originally intended to inspect a large new distribution center Walmart had built in California, mainly focusing on its network integration with headquarters.

He never expected to receive an invitation from Ernst, a representative of the younger generation of Americans and a super tycoon.

To his surprise, the other party immediately started talking to him about Walmart's logistics system.

Could it be that the other party is here to learn from me because they are an e-commerce company about to launch?

Just as Dalzel was lost in thought, the waiter who had left returned with three steaming cups of Blue Mountain coffee.

He carefully placed the coffee cups on the table in front of the three people, each cup of coffee accompanied by a delicate pastry and a silver spoon, arranged neatly and orderly.

"Sir, here is your Blue Mountain coffee. Please enjoy." the waiter said respectfully.

Dalzel nodded to the waiter, said "thank you," and then reached out to pick up the coffee cup in front of him.

He took a small sip, the rich aroma of coffee spreading in his mouth, but he had no mind to savor the deliciousness of the coffee at the moment; his sense of vigilance grew stronger.

He put down his coffee cup, organized his thoughts, and did not choose to answer directly, "The e-commerce model is indeed very novel. It breaks the time and space limitations of traditional retail and provides consumers with a more convenient shopping experience, which is undeniable."

"But without physical stores to support it, how can we guarantee the user experience? You know, Americans have made shopping at Walmart on weekends a habit, a habit that is deeply ingrained in their daily lives, just like how we have to drink coffee every morning, which is very difficult to change."

"But habits can be changed, and traditions are meant to be broken," Ernst replied domineeringly, even accidentally knocking over the coffee cup beside him.

The brown liquid quickly soaked through the tablecloth, leaving irregular stains on the fabric.

"Sorry!" Ernst hadn't noticed where the coffee was because he was facing Dalzel.

The other person seemed to be in a daze for a moment, then suddenly sent a nostalgic smiley face: "Mr. Sam used to spill his coffee in meetings all the time."

Dalzel was somewhat saddened, but also nostalgic and admiring. "He said that only with enough focus can one forget these details."

"I never imagined that I would one day be able to be compared to Mr. Sam. It is my honor."

Regardless of whether Walmart will become his future competitor, Sam Walton, a business pioneer who made outstanding contributions to the retail industry and promoted its development, deserves his heartfelt respect.

When Darzel heard Ernst's words, he just smiled and didn't say anything more. His eyes were filled with complex emotions, as if he was still savoring the memory from just now.

Seeing that the other party smiled without saying anything, Ernst steered the conversation back on track, "As the undisputed leader in the retail industry, I imagine Walmart must also be paying attention to Amazon's data, right?"

"Of course," Dalzel seemed to understand what the other person was about to say. "The customer repurchase rate is as high as 78%, which is a number that even Walmart cannot achieve."

"So, do you still think Americans really like the shelves?" Ernst seized on the key information in Dahlzel's words and immediately asked back, his tone slightly suggestive.

He didn't give Dahlzel much time to think, and continued, "The reason Americans used to like picking out items from physical store shelves wasn't because they were really into that way of shopping, but because they didn't have many other choices."

"But Walmart has also launched an online store, and judging from the current operation, the data is very good, which shows that we are also competitive in the field of e-commerce," Dahlzel replied.

"That's really impressive." Ernst didn't deny the achievements of Walmart's online store. He nodded and said objectively, "In just one month since its launch, the number of users has exceeded 12, and sales have exceeded $5300 million. In the short term, this is indeed a very impressive figure, which fully demonstrates Walmart's influence in the minds of consumers."

Ernst's eyes suddenly sharpened. He looked at Dahlzel and asked, "But have you thought about this carefully? Will this seemingly good data really receive enough attention from Walmart's internal management?"

"Or, in Walmart's overall business strategy, do they treat online and offline businesses on the same level, giving them equal resource support and strategic positioning?"

Darzel knew the answer in his heart: it was simply impossible.

Walmart's core business has always revolved around physical stores. After decades of development, these stores have formed a vast network covering the globe, generating hundreds of billions of dollars in revenue for the company each year—a level that online businesses simply cannot reach in the short term.

Even if the online store's business doubles, the annual sales will only amount to a few billion US dollars, which is a drop in the ocean compared to the performance of physical stores, and there is no comparison at all.

Ernst continued, "If one day, online and offline businesses clash, what will Walmart choose? Moreover, the internet is a rapidly changing phenomenon; any hesitation could lead to Walmart's online store being eliminated."

Do you think this kind of e-commerce can survive in this online shopping war?

"But Walmart also has its own advantages," Dahlzel retorted in a deep voice.

"Yes, Walmart has its own advantages, but those advantages can be overtaken."

Ernst leaned back and reached for the coffee the waiter had brought him again. "Amazon is accelerating the construction of its warehousing and logistics, as I'm sure you know, and Walmart's proud supply chain will gradually be eroded as its e-commerce business grows larger."

"But can Walmart break the dominance of e-commerce? Reduced labor and rent costs give e-commerce a greater price advantage. Once a price war breaks out, can Walmart keep up? Is management willing to take the gamble?"

Dahlzel remained silent for a long time before finally speaking, "So Mr. Garfield called me here today just to try and undermine me?"

"No." Ernst seized the opportunity, snapped his fingers at Affil, who had been sitting quietly to the side, and the latter took a document out of his briefcase and handed it to him.

"This is an employment contract. I want to invite you to my company to rebuild a global logistics system that covers both online and offline channels. We're not going to build ordinary warehouses, but order fulfillment centers that use code to manage every item so that customers can receive their packages within the next three days, whether they live in New York or Alaska."

"Offline?" Darzel grasped the key point.

Ernst did not explain, "You will know all the details when you sign this contract."

"But you can take a look at this plan first." Ernst pushed another document in front of him.

Darzel silently opened the document, his fingertips tracing the words "automated sorting system".

The plan inside was vague, but Darzel understood it.

Walmart's logistics relies on scale and experience, but Ernst wants to restructure all of that with technology.

For someone who has spent his entire life dealing with logistics, this job, in terms of both its challenge and novelty, stirred a longing within him, yet he still did not accept it.

"I need time to think it over," he finally said. "Mr. Sam Walton has been very kind to me, and I can't just leave like this."

"I never force anyone; I only seek like-minded partners," Ernst said, raising his coffee cup in a gesture of respect.