Inside This Issue - News
Walmart likes what it sees in small-format stores
June 16th, 2014
FAYETTEVILLE, Ark. – Walmart’s small stores are thriving, according to Bill Simon, the company’s U.S. president and chief executive officer.
“Neighborhood Markets and Walmart Express stores have been a big hit, providing fast, easy access whenever and however customers want it,” Simon said earlier this month during the Walmart annual shareholders meeting at the the University of Arkansas’ Bud Walton Arena.
Neighborhood Markets, which average approximately 40,000 square feet, delivered a 5% same-store sales increase last quarter, so the retailer is building up to 200 more this year, Simon said.
“So you can see why we are so excited about this format,” he added.
The still smaller Walmart Express is fast becoming a customer favorite “because of its easy access, and it is a favorite of ours because of its sales growth,” Simon said. “We’ll add 80 to 100 this year.”
In a first for Walmart, the company plans to open more small stores than Supercenters this fiscal year. The retailer believes that the small boxes offer a chance to wring more growth out of mature markets by taking sales away from drug stores, dollar stores and supermarkets. In addition, the new stores will all be digitally connected.
Walmart president and CEO Doug McMillon stressed technology at the annual meeting, saying that consumers want “the excitement and the immediacy of shopping in a physical store and the freedom to shop whenever, however and wherever they want. They want an experience that seamlessly adapts to their life. Walmart can bring together our stores with new digital commerce capabilities to help customers save money, save time, and have access to what they want and need. Walmart will exceed their expectations.”
“Mobile has changed everything,” McMillon pointed out. “People now spend more time on digital devices than they do watching TV. A lot of times, they’re doing both at the same time.”
Walmart gets more e-commerce traffic in the United States from mobile devices than from personal computers, McMillon noted. “And, increasingly, our customers will do their grocery shopping on their phone or tablet in their spare time, not during their precious family time. We’re going to make that possible.”
The chain will continue to add services and pickup points to become more convenient, he said, while promising to enhance its traditional e-commerce offering of online ordering and home delivery.
Showing a picture of an Asda truck that serves as a pickup point at a subway station in London, McMillon said, “It may look like any other truck. But it offers access to 26,000 items today and who knows how many items and services tomorrow. This is just one example of the integration of digital and physical retail: their device, our stores and this new pickup point.”
He said the discounter’s brick-and-mortar business would be improved with price leadership, a strong in-stock position, friendly service and compelling merchandise presented aggressively. “When we’re at our best, the features in our stores anticipate what our customers want and need,” he said.
Neil Ashe, president and CEO of Walmart global e-commerce, highlighted the strong growth of e-commerce sales and how Walmart is bringing together brick-and-mortar and digital retailing.
“We are integrating digital retail and physical retail to create one seamless, customer-driven Walmart experience,” Ashe said. “This is providing our shoppers with more value, more time and greater access. We are helping people save money in new and convenient ways so they can live a better life. And we’re doing it by bringing together the best of e-commerce and the best of retail.”