Walmart said yesterday at a meeting with investment analysts that “revenue at its namesake stores in the U.S. that have been open at least a year rose three months in a row in July, August and September,” according to an Associated Press story. If the pattern holds through the end of quarter on October 28, it should mark the end of a nine-quarter string of stagnant or declining US same-store sales.
Wal-Mart had promised a quarterly increase by the end of this year, ending nine quarters of declines, and Wednesday’s news indicates it could make good on that vow in the current quarter, which ends Oct. 28.
“The progress is now visible in our business,” said Bill Simon, president of Walmart’s U.S. stores. “We have confidence in our plan.”
That plan includes cutting costs and prices across the board, as well as opening small store formats across the US and working to build online sales with offers of free shipping.
“We have had very positive momentum in the back half, especially in the U.S,” said Charles Holley, the Walmart CFO. “We have more opportunities to grow more sales in the U.S. and around the world. But we will be deliberate.”
The New York Times writes that “Mr. Simon said one reason for the turnaround was the company’s decision to restock more than 10,000 items that had been removed as part of an effort to clean up the stores and make them less cluttered. He said customers were shopping less because they didn’t see the items they wanted.”
In addition, Bloomberg reports that Walmart now plans to “focus its mergers and acquisition strategy on existing markets,” looking to expand in places where it already is operating rather than expanding into new markets.
Doug McMillon, chief executive officer of the company’s international unit, said, “First and foremost we want to build scale in the markets where we are. We like the markets that we are in and will continue to prioritize those. There are a few remaining high-growth markets we are not in, and we won’t miss an opportunity there if one presents itself.”
The story notes that Walmart currently is integrating acquisitions made in the U.K., China and Africa. Analysts say that Japan is the most likely place for Walmart to make an acquisition in the short-term.
Meanwhile, the activist group called Organization United for Respect at Walmart, (OUR Walmart), complained that nearly 100 of its members “were turned away from the front door of Walmart Stores (WMT) home office here today by Walmart security and Bentonville police as they asked to meet with Walmart CEO Mike Duke for the second time in six months. The employees are in Arkansas to offer solutions for improving the company’s ailing U.S. store operations on the same day that Wall Street analysts and investors are assembled at the company’s annual investor conference to hear from senior management about what the next year holds for Walmart.”
OUR Walmart says that it has three goals: “Respect and better schedules, wages and benefits for Walmart’s employees, success for the company, and outstanding service and value for the customer.”
Wal-Mart had promised a quarterly increase by the end of this year, ending nine quarters of declines, and Wednesday’s news indicates it could make good on that vow in the current quarter, which ends Oct. 28.
“The progress is now visible in our business,” said Bill Simon, president of Walmart’s U.S. stores. “We have confidence in our plan.”
That plan includes cutting costs and prices across the board, as well as opening small store formats across the US and working to build online sales with offers of free shipping.
“We have had very positive momentum in the back half, especially in the U.S,” said Charles Holley, the Walmart CFO. “We have more opportunities to grow more sales in the U.S. and around the world. But we will be deliberate.”
The New York Times writes that “Mr. Simon said one reason for the turnaround was the company’s decision to restock more than 10,000 items that had been removed as part of an effort to clean up the stores and make them less cluttered. He said customers were shopping less because they didn’t see the items they wanted.”
In addition, Bloomberg reports that Walmart now plans to “focus its mergers and acquisition strategy on existing markets,” looking to expand in places where it already is operating rather than expanding into new markets.
Doug McMillon, chief executive officer of the company’s international unit, said, “First and foremost we want to build scale in the markets where we are. We like the markets that we are in and will continue to prioritize those. There are a few remaining high-growth markets we are not in, and we won’t miss an opportunity there if one presents itself.”
The story notes that Walmart currently is integrating acquisitions made in the U.K., China and Africa. Analysts say that Japan is the most likely place for Walmart to make an acquisition in the short-term.
Meanwhile, the activist group called Organization United for Respect at Walmart, (OUR Walmart), complained that nearly 100 of its members “were turned away from the front door of Walmart Stores (WMT) home office here today by Walmart security and Bentonville police as they asked to meet with Walmart CEO Mike Duke for the second time in six months. The employees are in Arkansas to offer solutions for improving the company’s ailing U.S. store operations on the same day that Wall Street analysts and investors are assembled at the company’s annual investor conference to hear from senior management about what the next year holds for Walmart.”
OUR Walmart says that it has three goals: “Respect and better schedules, wages and benefits for Walmart’s employees, success for the company, and outstanding service and value for the customer.”
- KC's View:
-
It is not surprising that Walmart’s top executives have been pursuing improved US results with such alacrity - almost as if their jobs depended on it.
The question is whether this is a short-term fix to satisfy Wall Street, or whether the company actually has been able to address what appeared to be strategic weaknesses in the company’s long-term plans. To be honest, I’m not sure ... but I do know that there are a lot of people who believe the former, who believe that Walmart has lost touch with its core value proposition.
