Walmart will open hundreds of smaller-format stores over the next three years, Bill Simon, president and chief executive officer of U.S. stores, said at an investors conference here this month.


Walmart, smaller-format stores, Bill Simon, Arkansas, Walmart Express, Chicago’s South Side, Neighborhood Market, Walmart Market, Chicago’s West Loop, Walmart on Campus
















































































































































































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Inside This Issue - News

Walmart gears up for smaller stores

March 21st, 2011

NEW YORK – Walmart will open hundreds of smaller-format stores over the next three years, Bill Simon, president and chief executive officer of U.S. stores, said at an investors conference here this month.

The discounter is already breaking ground in Arkansas on Walmart Express units, a format less than one-tenth the size of an average Supercenter. The chain will reportedly debut its first urban Walmart Express outlet this summer on Chicago’s South Side.

Simon said in the fall that the largest of the new bantam stores would be Neighborhood Market (now to be renamed Walmart Market) units between 30,000 and 60,000 square feet.

One of the Walmart Markets will premiere in Chicago’s West Loop, about a half mile from a site in the city where Target Corp. plans to open its own small grocery store. Both chains are bidding to boost urban sales amid the saturation of the suburbs by big boxes.

The small Walmart stores will include the tiny Walmart on Campus format. At the Bank of America Merrill Lynch conference Simon showed a slide of one such unit at the University of Arkansas in Fayetteville. At 3,300 square feet it has 2,800 SKUs, half of which are groceries, with the remainder being general merchandise and health and beauty aids.

"Multichannel initiatives" are one part of the retailer’s four-point plan to improve sales in fiscal 2012, Simon said. The other elements are everyday low price leadership, diverse assortments and improvements/remodelings.

The company’s challenge is to deliver one-stop shopping by having the broadest mix possible backed by low prices, he said. The chain’s “action alley” communicates everyday low prices while making products more accessible, he noted.

SKU reductions ranging from 2% to 26% across Walmart’s six merchandise units cut the total SKU count by 9%, he pointed out, saying the decrease impacted the discounter’s one-stop-shopping advantage. To broaden assortments Walmart will raise gondolas, address space challenges in pharmacies and entertainment sections, and consolidate seasonal departments.

In the fishing section, increased space and a more diverse selection are already driving sales, Simon noted. A space increase of about 10% has boosted rod and reel volume by some 40% on a year-to-year basis. On the remodeling front, renovations this year will cost less and be less disruptive to shoppers, he added.

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