Wal-Mart reveals new game plan

[ERIC]

Wal-Mart aims to clean up stores, improve goods
FAYETTEVILLE, Ark. (Reuters) — Wal-Mart Stores (WMT) said Friday it needs to clean up its stores, treat employees well and bring in more upscale goods like organic food and trendy clothes to revive sales and profit growth.
Executives at the world's biggest retailer said their "game plan" for this year involves targeting wealthier shoppers who may buy basics like food at Wal-Mart but look elsewhere for fashionable items like clothing and housewares.

"We aren't where we need to be, especially in the Wal-Mart stores in the U.S.," Chief Executive Officer Lee Scott told a crowd of 20,000 gathered for the annual meeting here.

The strategy shift comes after Wal-Mart missed profit forecasts for its recently ended fiscal first quarter. The retailer has also endured years of bad publicity, ranging from charges that it discriminates against women in pay and promotions, to the recent resignation of former Vice Chairman Thomas Coughlin amid charges that he misused company funds.

Wal-Mart set three goals — making the company a better place to work, improving the shopping experience, particularly for women, and being more aggressive in buying merchandise.

"We sometimes have inconsistencies in how clean a store is, or how organized," said Mike Duke, head of the U.S. Wal-Mart Stores division, by far Wal-Mart's largest unit.

"Sometimes our checkout lines are too long and we're not staffed properly," he said. "We did a great job of focusing on the opening price point customer. We may not have focused enough on the customer who is willing to pay for a little better quality and style."

Wal-Mart has had a great deal of success getting customers into its massive supercenters, which combine a grocery store with discounted general merchandise. But lately food has accounted for the lion's share of sales growth, and that has hurt earnings because food generates thin profit margins.

Scott said the key is to improve merchandise, particularly apparel and housewares, to encourage people to cross over from the grocery aisle into the discount store.

"We need to widen our appeal to a broader range of customers," Scott said, but was quick to add that the retailer will "never turn its back on its obligation" to low-income customers who can't afford to shop elsewhere.

Low-income shoppers have been hit particularly hard by rising energy prices, which have cut into disposable income. But Wal-Mart's biggest competitor, Target Corp., has turned in strong growth while Wal-Mart's sales have faltered.

Target's customers tend to be wealthier than Wal-Mart's, but Scott said Wal-Mart was out to change that. Wal-Mart has already started adding pricier items like high thread-count sheets and flat-screen televisions in hopes of drawing more middle- and high-income shoppers to its stores.

[Baer Charlton]

They are dreamin'. You can take the store out of the getto, but you can't take the getto out of the store.

Target had to go bankrupt and close 90% of it's stores to finally shed the trailer trash/getto image... it's been a long hard 30 year comeback.

I've got stock in Target, but I'd never by stock in WMT.
Wal-Mart set three goals — making the company a better place to work, improving the shopping experience, particularly for women, and being more aggressive in buying merchandise. That has Home Depot's handwriting all over it.... then they started firing every worker over $30K/yr and hiring three part-timers at min-wage that they didn't have to pay benies to.

[EllenAtHowards]

I LOVE that 'more aggressive in buying mdse' part! They are already so tough on their suppliers. "We will buy from you , but not at less 40% like the rest of the industry, but at less 60% the first year, less 70% the next year, and so forth." I understand that this is why you don't find Rubbermaid products in Walmart...

But I guess if you are a manufacturer, and you can sell three times as much stuff, even though you only make half as much on each item, you can still make money. But it really makes the small guy look bad when a customer can go to BigBox and buy stuff for less than SmallShop pays for it from their supplier. Sigh.

[wpfay]

There's a pretty interesting article in tis month's Gourmet magazine on a supplier of organic dairy products.
One of their practices mentioned in this article is to add water and salt to their beef products, about a 12% increase in weight from water. The Publix chain is sending out fliers claiming they do not use this practice.
Winn-Dixie, no. 3 in the food business locally is looking hard at Ch. 11, Albertsons is gone, and Food Lion is hanging in there.

[Grumbler F.K.A. Harry]

[QUOTE]Originally posted by ERIC:
Executives at the world's biggest retailer said their "game plan" for this year involves targeting wealthier shoppers who may buy basics like food at Wal-Mart but look elsewhere for fashionable items like clothing and housewares.

"Fasionable", "Housewares"..... hmmmmmm what could that mean? :rolleyes:

[Jerry Ervin]

Here is the real question.

Can Wally World keep their base (cheap) customers as well as go after more upscale clientèle?

I read an article that stated that over 20% of WalMart shoppers don't have a checking account.

That speaks volumes if you stop and think about it.

[ERIC]

I find this and other points in their new corporate image building effort to be vulgar.

They are advertising on NPR and on PBS about how they are to be esteemed for their job creation ability. :rolleyes:

After years of playing things their way, it is starting to no longer work. They must see the end in sight. The anti-Wally sentiment in no longer just a little vocal fringe, but is becoming a broader attitude.

After they have 'clear cut' the marketplace, the workforce, retail real estate, public perceptions, corporate responsibility, . . . . there is room for something else to fill in behind the disruption - either someone doing their thing, only better; or something completely new and different. Maybe we will see the return of Main Street?

Regardless, I wonder if the time for thier business as usual is about to expire.

It ends up being like that person you know who is a real jerk, deciding to get a better wardrobe so that people will like him more.

[Dave]

Why not become the nation's consignment shop? They could take in second hand garments (where people have their names sewn into the garment instead of written in with a marker?) But then, GoodWill already has that market.

It is much easier to live up to expectations than to change people's expectations.


Dave Makielski

"Perception is reality"

[ERIC]

Aren't they already doing that with a few of their vendors?

The stuff is still the vendors while it's on the shelf. When it sells then Wally pays for it.

[Dave]

From my understanding, "Wally" after pushing a supplier to way beyond "end column" then proceeds to automatically deduct 10-15% off every invoice to account for "defectives and returns".

Think LJ would go for that one?

Dave Makielski

"Speak softly and carry a big stick"

[Dave]

Then, because business with Wally is so good, they let go of other customers and hire people, open new manufacturing facilities, etc. to keep up with the demand.

How do you spell "C H O P P I N G B L O C K" ???

Dave Makielski

"A bird in hand is worth two in the bush"

[ahohen]

redface.gif The bunch of *(^%$#_)*&^%*(!!! What tees me, REALLY tees me off with both WalMart and Sam's is the checkout. Over 30 checkout counters and usually only 5-10 cashiers! I got so teed off one time (after wainting in line for 25 minutes), i filled the basket with frozen stuff, parked the basket in the outside in the flower section and left!! WalMart better grow up! Bunch of idiots!

[Ron Eggers]

But what can you expect from a business whose claim-to-fame is being cheaper than everyone else, huh?

[gemsmom]

I hope I don't sound like a snob, but, what makes Walmart execs think the upper-crust would want to shop where the "base (cheap)" as Jerry put it, customer's shop? People with money are willing to spend a few dollars more for a better shopping experience than Walmart.

[framinzfun]

Call me crazy... but I shop at Walmart frequently. I get most of my food (except meat and produce, yikes) and most of our other odd stuff, you know, bathroom stuff, TP, printer paper, etc... and my theory on the whole thing is that I don't go to Walmart for customer service (which really isn't bad at the one I go to) and I don't go there for high end electronics, tires, or an oil change - or photos for that matter... If I want to be pampered, I'll go to Neimann Marcus, when I need cheap toilet paper, I go to Walmart. End of story. If everyone hates Walmart so much, how do they keep opening up so many new stores? Somebody's shopping at them... and I don't want to hear about getting put out of business by having a Walmart move into town, because if all it takes is low prices to make someone stop shopping at your store, you are definitely doing something wrong. I used to really hate Walmart... and then I watched that 2 hour thing on MSNBC or one of those channels, and now I understand what they do and why. I really doubt they are going to start catering to the upper-crusties, however, last time I drove through our Walmarts parking lot, I saw a lady get out of a fairly new Jag... and I highly doubt she lives in a "ghetto", and neither do I.

[ahohen]

Well WalMart, KMart, Winn-Dixie, and (none other yet)... I will do like my buddy does. I will put their phone numbers in my cell phone under my "S(***List)". If i am in a long checkout line, simple, i will call the number and warn them: "Open a few more cash registers to speed things up or I will make sure you are fired." Or, "I will come in with my video and send a copy to the main office." Or, (without using my cellphone) raise my voice so everyone in in the store can here me and tell them "everyone will walk out unless you open more registers". (I was at Winn-Dixie a few months ago when someone did this... 4 additional cash registers were open in less than a minite!)

[Jay H]

My wife has been a restaurant manager over half our life together. We have learned that the companies will always side with the manager when dealing with a customer acting like a horses @ss. The manager knows that a single customer complaint won't even put them in bad standing with the "home office" and will rarely act positively to idle threats. As a matter of fact they will usually just ask you to leave and never come back. Ditto for the silly videotape concept.

Now as far as yelling, wouldn't that just make you look really stupid?

Now comment cards and correspondence via letter to the company is typically taken very seriously. More than 3 similar complaints in a short time span will almost always warrant a visit from a regional manager or director of operations.

But why not just go someplace else?

If enough people do this it will get some REAL attention. Acting a fool certainly won't.

[Bob Doyle]

Originally posted by ahohen:
redface.gif The bunch of *(^%$#_)*&^%*(!!! What tees me, REALLY tees me off with both WalMart and Sam's is the checkout. Over 30 checkout counters and usually only 5-10 cashiers! I got so teed off one time (after wainting in line for 25 minutes), i filled the basket with frozen stuff, parked the basket in the outside in the flower section and left!! I worked in a couple of grocery stores. That kind of tactic really sticks in the craw of the store.
Originally posted by ahohen:
WalMart better grow up! Bunch of idiots! umm,,,yeah,,, WalMart was the one being immature!

Not defending WM, personally have avoided shopping there at all costs! But man if you are angry with them, tell them! Call on your cell phone, or write a comment card, or fire off an e-mail to teh corp office, but to damage product, and thus raise prices to the other customers, 20% of whom don't have enough money to put in a bank account, is that a REAL figure! Man "wealthier" customers is a relative term here!

If my customers were that upset, or were experiencing bad service I'd want to be told, not **** on.

[ERIC]

if all it takes is low prices to make someone stop shopping at your store, you are definitely doing something wrong. Sometimes the public is too easily impressed. :rolleyes:

[Maryann]

Our local Walmart's tactic is to mark a price on the shelf that is lower (sometimes much lower) than the price that scans. Most people don't notice. I have and I stopped shopping there.

As far as misplacing a cartload of frozen food, that's just stupid. How do you know that a clueless kid who didn't want to get yelled at by a manager for not noticing it sooner, put the thawed food back in the freezer and got a bunch of people sick? I guess I just don't understand vandalism.

[Dave]

I agree that the abandoned shopping cart is not a good idea at all. If you don't like the way a store treats its customers, the best thing to do is let your wallet walk away. Now, saying that, it would be kind of you to let the manager/owner know why you are leaving as often an employee is being a maverick when they mistreat a customer. What manager/owner worth his or her salt would ever condone bad customer service?

Dave Makielski

[Dermot]

Originally posted by Maryann:
Our local Walmart's tactic is to mark a price on the shelf that is lower (sometimes much lower) than the price that scans. Most people don't notice. I have and I stopped shopping there.

Surely that sort of practice is illegal…….it is in Ireland and you regularly read about retailers been brought to court and receiving a hefty find........and it makes no difference if it is accidental or (presumed by some) intentional

The international organisation who looks after scanning codes have persuaded most countries around the world to treat the displayed price and a higher scan price as illegal…….I cant imagine that the US did not sign up to that……

Well I expect we will have Wally in Ireland before long they have being scouting Ireland for business to buy and transport companies who will partner with them for logistics ……..I think they will find Ireland tough going as some of the current newer operators (German Aldi & Lidl) are finding out at present trying to compete with some of the more established operators……time will tell…..Wally will be up against one of the biggest retailer (Tesco) in the world when they enter the Irish market……

BTW what is so wrong with Wally trying to reposition their business…..surly that is only good business practice!!!!!!

[Maryann]

It is illegal - at least in the Commonwealth of Pennsylvania. I did express my concerns to the manager and when he was unconcerned (and rude) I took my wallet elsewhere as someone suggested and then took the time to write to the Attorney General. They are investigating as it was apparently a big problem here. There's enough other stores around - even in our small town - that my self imposed boycott hasn't bothered me once.

[D_Derbonne]

I have noticed different prices when checking out at many stores.
I usually notice and wait for the price check.

Publix takes it seriously. If an item scans higher than the price on the shelf you get it for free. smile.gif