Inside This Issue - Opinion
Move by Walmart will galvanize food sector
February 7th, 2011
"With this announcement, the largest corporation in America is launching a new initiative that has the potential to transform the marketplace and to help American families put healthier food on their tables every day."
So said Michelle Obama at an event in Washington last month where Walmart unveiled an ambitious program designed to enhance the nutritional quality of the food it sells and make healthier food more affordable.
The nation’s first lady, whose Let’s Move! campaign aims to help put an end to childhood obesity, was correct on both counts. Walmart’s five-part plan will indeed improve access to food with high nutritional value and, in the process, raise the bar for the entire grocery industry.
The initiative’s key components — working with suppliers to reformulate thousands of packaged food items by 2015 to substantially reduce levels of sodium and added sugar, and eliminate partially hydrogenated fat and oil; saving consumers of fresh fruit and vegetables approximately $1 billion a year by bringing to bear the retailer’s expertise in sourcing, pricing, transportation and logistics; and developing a seal for the front of food packages that helps shoppers more easily identify healthy options — leverage Walmart’s unmatched scale and the clout it gives the company with members of the supplier community. As the country’s largest grocer, with 140 million customers a week passing through its stores, Walmart is in a unique position to influence what goes into the products that are part of its merchandise mix.
The retailer has demonstrated its ability to reshape the market numerous times. When it began selling a 30-day supply of hundreds of generic drugs for $4 several years ago, many other pharmacy operators decried what they predicted would be a short-lived publicity stunt. It quickly became apparent that consumers thought otherwise, and today most purveyors of prescription medications offer some sort of loyalty or discount program.
Now Walmart has set its sights on the food sector. While several other retailers may have started down this road ahead of it (something that was also true with generic drugs), Walmart is very likely to galvanize the forces of change. By bringing healthier food options to consumers, the company will no doubt once again find that it can do well by doing good and motivate other retailers to follow suit.