Walmart Puerto Rico aims to substitute 5% of imports with products made, assembled or harvested locally through its Open Call program. And chances are it will do it, given its track record.
The program initially kicked off in 2018 with an aggressive plan to replace $30 million worth of annual imports with local products within five years. When it achieved this goal within only two years, the retailer doubled the target to $60 million. Last year, it met this goal.
Open Call is an opportunity for local entrepreneurs to become Walmart suppliers. Applicants go through an evaluation and guidance phase that helps them prepare their proposals and presentations for face-to-face, half-hour meetings with Walmart buyers. The chosen candidates receive a “golden ticket.” This ticket doesn’t mean that their products will go straight to store shelves, but symbolizes they’re readiness to start the process of doing business with the retailer.
“This is one of the programs that we enjoy the most because we get to know their stories and help them develop local products and grow their businesses,” said Ángel Alvarado, supplier development and private brands manager at Walmart Puerto Rico. “At the end of the day, we’re Puerto Ricans helping other Puerto Ricans grow and contribute to the economy of our island.”
2023 Open Call
This year’s Open Call, which closed on Sept. 30, resulted in more than 80 applications from local entrepreneurs hoping to have their products placed on Walmart store shelves. Walmart Puerto Rico has 18 stores on the island: 13 supercenters, five discount stores and seven Sam’s Clubs. The company, which employs more than 13,000 people on the island, also has a distribution center in Cataño.
One interesting trend is the rise of young entrepreneurs applying to be Walmart suppliers, Alvarado noted.
“We’re seeing more young people, especially since the pandemic, seeking to be their own bosses and run their own businesses,” he said. “There’s a movement of young people betting on [such areas as] agriculture, for example, hydroponic lettuce, as well as manufacturing.”
Walmart Puerto Rico has more than 100 Open Call-based suppliers. One of them, R ’Brothers, the manufacturer of sangria Los Hermanos, is one of the program’s great success stories. The company not only sells its products at Walmart stores, but also produces a private brand for the retailer named Rumgría, which is a fusion of rum, wine and tropical fruit flavors.
“This is one of the suppliers we took to the states for the Open Call there, and an opportunity to sell their products in stateside stores,” Alvarado said.
This year, Walmart Puerto Rico brought three local suppliers to participate in the U.S. Open Call event in Arkansas on Oct. 24-25: R ’Brothers, Ricomini Bakery (maker of the popular brazo gitano) and V. Suárez with the Kresto brand. These suppliers were chosen because they demonstrated potential and capacity to export their products, Alvarado said.
“At a personal level, as a supplier and private brand developer here on the island, Open Call is one of the things that I’m most passionate about,” he said. “At the end of the day, it fills us with pride to be able to help make dreams come true and have products made by Puerto Rican hands in our stores.”
Counteracting the Walmart effect
Open Call is one of several programs that Walmart has implemented to, among other things, counterbalance the “Walmart effect.” The term refers to the potential adverse economic impacts of opening Walmart stores in an area, such as displacing smaller retailers and lowering wages.
Under its corporate mission, Walmart has implemented other programs that pursue job creation, community outreach, sustainability and philanthropy.
“There’s always going to be some friction – that’s normal in business, but it has decreased a lot in recent years precisely because of the positive impact these initiatives have had,” Alvarado said. “We wanted to enter Puerto Rico as an ally of the local industry … as business partners that look after the economy, which is one of the pillars of our organization.”
For Walmart Puerto Rico, being able to reciprocate local customers’ patronage and loyalty is worth every effort, he said.
“The magic of Walmart in Puerto Rico is that we’re Puerto Ricans – Puerto Ricans who are making sure that more Puerto Ricans can grow and progress, that we’re having a positive impact on our communities and that more Puerto Rican families save more and live better, which is our motto,” he added. “That’s how we live it. That’s how we execute in our various business formats.”
With global revenue of $611.3 billion in fiscal 2023 (up 6.73% from 2022) and 2.1 million employees, Walmart Inc. stands as the world’s largest retailer and holds the top position in the Fortune 500.