Wal-Mart downsizes its stores

The retail giant turns to small and midsized buildings in an effort to draw more US shoppers.

By Kim Peterson Jun 15, 2011 2:37PM
Wal-Mart (WMT) stores are about to get smaller. The new ones, anyway.

The company still runs the giant, sprawling supercenters that we're familiar with. But now it's opening more midsized stores under the Walmart Market name. They're about the size of an average supermarket.

Wal-Mart already has 185 such markets and wants to open 90 to 100 more by January. That total will ramp up to 300 by fiscal 2013, the company said.

And Wal-Mart is getting even smaller with Wal-Mart Express, its answer to the dollar stores that have been stealing its business. Wal-Mart Express stores get you in and out fast, with milk, eggs, a pharmacy, check-cashing services and gasoline pumps.

Hear what Wal-Mart executives said to reassure shareholders about its sales in the following video.

Post continues below:
All of these moves are designed to reverse a sales slump in the U.S. that has lasted for eight straight quarters. Wal-Mart has made some bad decisions in the past few years as the recession hit, and it has been desperate to reverse its momentum.

Wal-Mart shares fell more than 1% Wednesday to $52.23. Shares have spent much of the past year in the $52-$55 range.

The economic downturn sent more shoppers to dollar stores and supermarkets. Those who still went to Wal-Mart stopped buying the more profitable items, including furniture and clothing, and focused on household items and other basics.

Wal-Mart cleared out the clutter in its stores, removing items in an effort to spruce up and appeal to wealthier shoppers during the recession. But that backfired with its core base, which wanted more selection and value.

So what do you think? Will a smaller Wal-Mart bring shoppers back to the company?

VIDEO ON MSN MONEY

504Comments
Jun 15, 2011 4:06PM
avatar
I think what Wal-Mart needs to do is go back to it's commitment to low prices. Convenience is not the reason people are goind to the dollar stores, prices are the reason we are going to the dollar store.  When I have to pay 4 bucks for a gallon of bleach at Wal-Mart and and can get it for a buck at the dollar store where do you think I will go?  I stopped buying groceries at Wal Mart when they tried to charge $1.44 for a single green pepper than I could get an Aldi's for 50 cents.  Milk, same way, Wal-Mart wants $3.80 for a gallon of 2 percent milk that I can get at Aldi's for $2.45.  Wal-mart thinks they can continue to sneak these huge price increases past the consumer, well, it isn't working!  Stop blaming everything else Wal-Mart and look at your prices, those are the problem!
Jun 15, 2011 4:09PM
avatar
Will smaller Wal-Marts draw more shoppers? Doubtful.

But better service might.
Jun 15, 2011 5:44PM
avatar

Sam Walton built Walmart on several basic ideas in the following order: 

1. Happy motivated employees

2.  Personal caring customer service

3.  One stop shopping

4.  Eliminating the middle man by buying direct and becoming his own distributor

5.  Good quality made in America products

6.  Competitive pricing. 

 

His heirs have changed a few things in the following order:

1.   Increase next quarter profits

2.   Pare down labor costs

3.   Decrease cost of sales by purchasing cheap overseas

4.   Don’t worry about the customers, they have no other place to shop

5    Crush the competition by any means possible


The heirs plan seems to be working well doesn’t it?  At one time Sears was the unchallenged and invulnerable retail sales company in the world.  Their arrogance brought them down as will Walmart’s.

Jun 15, 2011 4:11PM
avatar
The reason I don't like it is it takes too long to get in and out.  They increased the size of the store, then added a total of about 30 checkout registers in which only 10 are open at any given time.  It's take me 10 minutes to get what I need there, but another 30 minutes to check out.  Customer service is what it's about.  Time is money Walmart.  Walmart's practice of forcing suppliers to lower prices is another issue.  They used to carry decent products, now all they carry is the crap. Crap caused by pushing lower prices.  Lower prices causes lower quality.  I DONT LIKE FRAM OIL FILTERS and will never buy one.  Start selling quality and I will come back.  I have never been in a Dollar General but a handful of times.  I shop Target most of the time.
Jun 15, 2011 4:22PM
avatar
I think Wal-Mart is past it's prime. With the combination of prices being raised and very poor customer service it doesn't suprise me thay are loosing business. Plus EVEYTHING in Wal-Mart comes from CHINA. We should boycott them!!!!
Jun 15, 2011 4:31PM
avatar
Why do profits have to increase?  Why can't profits remain the same and everyone be happy?   Greed is destroying our nation.  Walmart vendors are letting quality slide just to get their products on the WM shelves at lower prices.  Consumers don't want the junk.  This wasn't Sam's dream.  Get back to basics Walmart.  It's what made you in the first place.  Sam wanted to bring quality to everyone at a reasonable price.  Little did he know how his idea would be twisted out of shape because of greed.
Jun 15, 2011 4:32PM
avatar
the layout of Wal-Mart's is always to much. I find myself exhausted by the time I've walked across the store 2-3 times to find products I'm looking for and then they never have exactly what im looking for. After that you have the 30 minute wait in line because all though they have 30-40 registers available only 3-4 are open at a time. The quality of their produce and pretty much everything else has gone down yet prices still seem to be rising. I have found that Aldi's, dollar stores, and grocery stores with their sales and coupons have become a much better deal and more pleasant shopping experience even if it does mean running to 2 or 3 stores.
Jun 16, 2011 8:35AM
avatar
I don't have first hand knowledge of Walmart's business practices.  I will say that I don't shop at Walmart anymore unless there are no other options.  I don't seek them out.  Primarily because I'm tired of walking a country mile to find a pair of scissors and then realizing that I need to hike another mile because I forgot to get the milk.  Secondly, because they have about 500 check out lanes and about three are open.  It is not a privilege for me when I shop at your stores Walmart, it is a privilege for you if I choose to shop there.  Acting like you care about me as a customer would help bring me back...maybe.
Jun 15, 2011 4:27PM
avatar
Walmart bullies their way into an area, pays crap wages, and lets the govt' subsidize their health care, most employees are eligible for food stamps. It doesn't take long before that causes some negative attitudes towards this company.
Walmart was banking on everyone wanting artificially cheap imports from China forever. As for the dollar store "stealing business away from Walmart" it is called a free market . Maybe if Walmart didn't spend so much money putting up new stores. they could pay their employees better wages, resulting in better quality and productive employees. Then as people started to see that the company actually cared about something besides its' profits, then they could increase their stores and people would shop there more. I quit going to Walmart 7 years ago because they tried to come into this area and lied, cheated and bankrupted our small rural township with law suits and zoning hearing. they took it all the way to the state court, but where unwilling to set aside watershed land, so they lost the case.
Yes, it is true, you don't NEED Wallmart. Try shopping at your local mom and pop retail store or
buy from a company who takes better care of its' employees. Don't think that is possible,
what did everyone do before Walmart. I think we all did just fine without them.
 

Jun 15, 2011 4:30PM
avatar
I work for a chain of grocery stores, Walmart is parking a food store next to all of them in the hopes of being "the only game in town" and running them out of business.  GO RIGHT AHEAD WALMART, YOUR CUSTOMER SERVICE SUCKS and we can be just as competitive as you in prices.  We offer good old fashion customer service, something you forgot about when Sam Walton died.  I needed to pick up something recently at Walmart Supercenter and was greeted by a produce employee who kept ignoring me until he finally realized I wasn't going away.  He greeted me with "Yeah, what do you want?".  I called Benton, Arkansas and complained about the lack of service throughout my whole visit to their store.  I was assured that I would receive a follow-up phone call.  3 Days later, an assistant manager of that store finally got around to calling me.  Yep, GREAT CUSTOMER SERVICE WALMART!!!  SO GO AHEAD, MOVE ACROSS THE STREET FROM MY STORE, GAME ON!!!!!
Jun 15, 2011 4:42PM
avatar
According to a recent radio financial commentator, Ms Walton and her two children are the third, fourth and fifth wealthiest people in the USA; all are worth many BILLIONS of dollars. If they took some of those billions and plowed it back into the stores and the employees, AND, got the hell away from made in china, maybe, just maybe, their image might improve.
Jun 16, 2011 11:21AM
avatar
The Wal-Mart near my house has literally gone down the tubes,  I stopped shopping Wal-Mart completely (I used to go in at least twice a week).  The associates are rude, dumb, and extremely unhelpful, and in my area some don't even speak Engli**** almost like they take courses in "How Not To Help The Customers".  The managers are a joke.  Their layaway (the best service they had) is gone, their product quality has declined, and they basically don't give a hoot.  I had an issue last year, called and wrote the district manager, called and wrote to corporate, and did not receive the basic courtesy of a response from anyone.  Now I'm done - no more Wal-Mart, and let me tell you, I spent a lot in that store.  Bring back the American made, American owned, American staffed stores, I would we willing to pay a little more for good service and a good product.
Jun 15, 2011 4:28PM
avatar
I don't see our WalMart anyway as the corporate citizen it used to be.  The local store here used to donate torn bags of pet food to our local animal shelter.  No more.  The store used to give small annual grants to local law enforcement for crime prevention or outreach programs.  No more.  The perception at least is that WalMart is completely money driven and has no use for anything else involving the local community.  In smaller towns like ours, WalMart is the only major grocery and department store in town.  I only go as a last resort.  I'll go to the smaller stores for quick items even if I have to pay more.  When I need to do a lot of shopping, I usually drive to the larger cities and shop other stores like Target, Albertsons, Kroger, etc.  WalMart just doesn't seem to care anymore.
Jun 15, 2011 4:58PM
avatar
Wal Mart has become so expensive, it's cheaper to shop grocery store sales. Most of their stores are run down and dirty. You can never find anyone to help. The tire center takes forever to fix a puncture (3 hours the last time). If they want to improve sales, they need to improve their image and hire people that care. Of course, to hire people that care, they'd have to pay them a reasonable wage.
Jun 15, 2011 4:39PM
avatar
they always seem to be out of what I need, also, how many remember what  Sam Walton said? if more than 3 people are inline to check out, another regester would be opened,, Ill bet Old Sam is spinning in his grave.
Jun 15, 2011 9:34PM
avatar
I'm a retail manager for one of those local grocery chains. During peak customer times we will open 18 or our 20 lanes, still have baggers and carryout service, and 90% of our store brand is manufactured in the good ol USA. So what is the norm?  Well, its to shop in my store and scream at me because all 20 lanes are not available, and your bagger just happened to step away to help a 80 yr old woman to her car, and my paper bags are on tonights order and we just used the last of it. Customers use the f word and attempt to say "I'll just shop at Walmart next time": And I seriously want to scream back to go ahead!!! There is no customer service, you are lucky to find three checkstands staffed, managers dont care. Well neither do the majority of us Americans. We continue to traipse in and out of Walmart and then complain that we can't find a job. It won't change till we do.
Jun 16, 2011 8:16AM
avatar
We shop at Kroger for our groceries because they are cheaper. Can you imagine that? Kroger is represented by organized labor also (union). I wish Kmart and their blue light specials would come back. I don't know why the Waltons, with all their money, want to keep buying from communists and selling to Americans. Their prices keep going up and up. Why?---- greed...
Jun 15, 2011 4:51PM
avatar

DevilI feel that the devil got to Wal-Mart. More & Profit Money Money! GREED! The Lord gives and takes away. How about all the China made products. . . mmmmmmmmm . .  Back in the days Wal-Mart was a USA Made company. I really am looking for that good ole American made product. How about you? We are supporting China and other countries and our USA is going to the Devil.  The Dollar stores are also China. Come on everyone.

 

?Wal-Mart are you going to come back to the good ole USA? How about a new Wal-Mart with USA Made Only?

Jun 15, 2011 5:30PM
avatar
Walmarts is probibly losing bussiness because people like myself are SICK AND TIRED of spending my hard earned money on CHINESE CRAP! I remember when Walmart first opened (when Sam Walton was alive) there were signs all over walmart claiming to be proud of products MADE IN THE USA. Now you cant find anything in there MADE IN THE USA. And thats why they have lost my bussiness. And I hope other people are tired of it too!!!
Jun 16, 2011 8:32AM
avatar

The "super powers" such as Wal-Mart are 1 of the biggest problems with America right now!They buy and sell products that are made somewhere else china mostly.Their "slogan"used to be MADE IN U.S.A.Not so much anymore.I used to buy grocerys there to save money.Seems they still are a little cheaper than most stores and their brand isn't half bad but goto another store and buy the same product....say soft batch cookies.Compare the quality of both from Wal mart and from Ingles or wherever.The ones from Wal mart are burnt broken and not soft.They are cheaper....but not as good!It is like they are buying "seconds" or something I dont know.Since I have realized this I dont shop there much anymore.Me saveing a few dollars is NOT worth geting products that are not as good and most definitly not worth puting american workers out of work!

Report
Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
Categories
100 character limit
Are you sure you want to delete this comment?

DATA PROVIDERS

Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.

MARKET UPDATE

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.
Market index data delayed by 15 minutes

[BRIEFING.COM] The major averages ended the midweek session with slim gains after showing some intraday volatility in reaction to the release of the latest policy directive from the Federal Open Market Committee. The S&P 500 added 0.1%, while the relative strength among small caps sent the Russell 2000 higher by 0.3%.

Equities spent the first half of the session near their flat lines as participants stuck to the sidelines ahead of the FOMC statement, which conveyed no changes to the ... More


Currencies

NAMELASTCHANGE% CHANGE
There’s a problem getting this information right now. Please try again later.