Walmart’s tepid sales performance in the fourth quarter is water under the bridge, so when Walmart U.S. CEO Bill Simon spoke this week at an investor conference he quickly focused on the growth potential of smaller stores, which are being expanded at a more rapid pace.
Simon spoke Tuesday at the Raymond James Institutional Investor Conference and he wasted no time displaying his enthusiasm for smaller stores that are outperforming competitors and delivering industry leading sales per sq. ft. In the fourth quarter, Walmart’s Neighbhood Market stores produced a 5% increase in same store sales and for the year the comp was 4%. Also of note is the fact that each of the stores in the fleet of more than 300 units produced a positive comp even though some locations are more than 10 years old.
According to Simon, Neighborhood Market gives Walmart the opportunity to capture the incremental sales it misses out on when customers forego one of the company’s 3,200 supercenters in favor of a more convenient alternative. The format gives Walmart the opportunity to capture a different type of trip and new customers, according to Simon.
Click here to see what else he had to say about Neighborhood Market, the even smaller Walmart Express and the interplay with e-commerce.