BENTONVILLE, Ark. — In October Charles Redfield was named executive vice president of food for Walmart U.S. Before that, he spent about three and a half years as executive vice president of merchandising for Sam’s Club, with sourcing and merchandising responsibility for the division’s more than 650 locations nationwide.
It is for his work at Sam’s Club, where he led the development of a merchandise assortment that offers increased value and relevance to the club’s members, that the editors of MMR have named Redfield the publication’s Merchant of the Year for 2015.
Redfield notes that the warehouse club format poses unique challenges to its merchants. Chief among them is the limited SKU count — a Sam’s Club on average carries about 7,000 SKUs, compared to about 140,000 in a Walmart Supercenter.
“That means every single item needs to perform.” Redfield says. “One or two items in a category that don’t work can kill your whole season.”
Another wrinkle is the fact that Sam’s Club’s strategy involves serving the needs of business members and consumers.
“Even with our limited SKUs we need to carry the most sought-after items that our members need and want,” Redfield explains. “We are the warehouse for many of our business members, and they rely on us for their everyday needs. And our consumer members count on us to meet their everyday needs as well.”
And then there are the “treasure hunt” items, which add fun and excitement to the mix. They can also add an element of frustration, because members may not find those products the next time they come to the club.
“That’s just a natural part of the treasure hunt experience,” Redfield says. “It creates that mentality where if you see something you want you really need to buy it, because it might not be there at the next visit.”
Getting that mix right is both an art and a science.
“I absolutely believe that data and trend information must help drive merchandising decisions,” he says. “And because there is more of that information available today, merchants who ignore the data are going to make more mistakes than their competitors. But there are those who believe, and I actually recently read an article that makes this argument, that the role of the chief merchant is extinct, because the information and data drives all decisions. I’m not in that camp.
“One of the best things about being a merchant at Walmart and Sam’s Club is that there is absolutely room for gut instinct. That’s the fun part. You’ve got to take this information and data, and let it lead you in the right direction, but then there are also things like looking at an item, working with the supplier on how to package it, and deciding how to display it on a pallet and how to make it come alive. Those are things that data can’t tell you.”
Asked about past merchandising successes, Redfield says meal solutions have been a big hit on the everyday needs side of the business, because they address a real need for time-starved customers who have less time to cook but still want healthy food for themselves and their families.
“That’s a good example of taking the information we have about what is important to the member, and then using it to develop items that address those needs.”
Redfield adds that some members have indicated that the portions in those meal solutions are too big. “What we try to do is develop crossover items that are good for a family and also for a business member. So we’re not developing meal solutions for single individuals or even for two-person households. Instead we develop items that appeal to families and also to small businesses — those become some of our most productive items.”
When it comes to treasure hunt products, Redfield says merchants can spend months or more developing items. But the ability to act quickly is also important, and for the past two years Sam’s Club has hosted a daylong event, called Minutes to Win It, where suppliers, many who the company does not do business with, are invited to come in and are each given about 30 minutes to pitch their product.
“We will often make a decision on the spot about whether we will buy that item, and then we’ll work hard to get it in the club within the next 60 days,” Redfield says. “Now today everyone makes fun of those selfie sticks. But we did a Minute to Win It event two years ago and someone brought us a selfie stick, and we bought it on the spot and got it into the clubs quickly during the holiday time frame. And it was one of our top-five best-selling items in electronics.
“That was an item that wasn’t even on our radar less that two months before Christmas. But trendy products like that come quickly and they can go away just as quickly. So if you’re not nimble enough as a retailer to act on it, it is a missed opportunity.”
Partnering with suppliers is also critical.
“My perspective is that we can’t be successful without our suppliers,” Redfield says. “And just as our customers and members have choices about where to shop, our suppliers have choices about where they do business. And so we take that very seriously.
“The most important thing in our supplier relationships, on both sides, is to make sure you do what you say you’re going to do. That is where you create trust. We are always going to have negotiations — that’s what we do. That’s the way business is done, because they’re negotiating on behalf of their company and we are negotiating on behalf of our member.
“But at the end of the day we know our suppliers have choices, and we want to make sure that we have availability of their product and that we can talk with them in the future about innovation and how we can develop items together and get exclusive products.”
Another factor that influences the way Sam’s Club merchants do their job is Walmart’s corporate initiatives around sustainability and supporting products that are made in the United States.
“It has changed the way our buyers review products,” Redfield says. “The corporate commitments that we have made as a company have empowered our buyers. Many of our merchants are personally passionate about these issues, and we’ve given them the ability to say: ‘Not only is it important to me but it’s important to us as a company, and we are going to make this a critical factor in our decision-making process.’ ”