Wal-Mart has scaled back its store numbers in the US in a move retail research agency Conlumino says underlines how much the retail landscape has changed in recent years.
In a statement today (January 15), CEO of Conlumino, Neil Saunders, said that "the blunt truth is that while stores remain a vital part of the retail mix, they are not quite as relevant as they used to be."
He went on to say that the growth of online retail, in particular Amazon, has undermined Wal-Mart’s position as the go-to destination for certain products.
"Against this backdrop, the economics of Wal-Mart’s extensive estate – which was specifically developed with the acceptance that some stores would cannibalize the sales of others – has changed," he said.
Wal-Mart has chosen to close all 102 of its Express Stores; its smaller format that has faced significant competition from the rise and rapid growth of ‘dollar stores’.
The extent of the store closures amounts to less than one per cent of Wal-Mart’s global store footprint, but according to Conlumino, represents a change in focus for the world’s largest retailer.
"The current and future priority is on creating a seamless multichannel proposition. This requires extensive investment that necessitates very tight cost discipline elsewhere, especially on the store front," said Saunders, adding that the retailer’s decision is part of a larger shift that will be played out across the sector in the coming years.
© 2016 European Supermarket Magazine – your source for the latest retail news. Article by Jenny Whelan. To subscribe to ESM: The European Supermarket Magazine, click here.
