Skip to content

Walmart To Expand Rollout of Sleeker Redesign To 300 Stores This Year

Walmart To Expand Rollout of Sleeker Redesign To 300 Stores This Year

Small Business Economic Development Community EAC News

Retail Giant Aims To Increase Sales in Apparel and Home Goods

Walmart, the nation's biggest retailer, is stepping up its rollout of spiffier remodeled stores that spotlight and display nongrocery merchandise, such as apparel and home goods, as it seeks to bolster its market share in those discretionary merchandise categories.

The Bentonville, Arkansas-based company, which has 4,624 U.S. stores, discussed its plans to bring the store upgrades to 300 locations during a fiscal first-quarter earnings call Wednesday. The chain reported strong results, with comparable sales in the United States up 7.4% compared with the prior-year period as financially pinched consumers flocked to its stores to buy necessities such as groceries.

Digital sales soared 27%, led by pickup and delivery. Overall U.S. net sales were $103.9 billion, up 7.2% from the prior year. Officials are so bullish they raised their guidance for the company.

Walmart gained market share in the grocery category, including with higher-income households, executives said. But they are looking to increase sales of higher-margin items like general merchandise, namely clothing and home goods. To do that, Walmart Chief Financial Officer John David Rainey said the company is expanding the remodeling of its stores that offer "an upgraded presentation and experience" for customers.

“Our newest remodeled Supercenters take a differentiated approach to showcasing general merchandise, with more brand shops, digital displays, mannequins, wider aisles and updated fixtures," Rainey told Wall Street analysts on the earnings call. "We’re very encouraged by the early reads on customer response to these initiatives and we plan to update 300 stores with these features this year.”

Walmart piloted the sleeker store design — which includes furniture and decor prominently displayed, and apparel being showcased on mannequins similar to a department store — last year in Springdale, Arkansas, at a Supercenter that's located near its headquarters. The remodeling effort then spread to the East Coast, including New Jersey, and now are a couple of dozen of the new-look stores are open around the country, according to company officials.

One of the changes in the remodeled stores is that merchandise for men — apparel, shoes and accessories — are all grouped together rather than product category.

Walmart executives cautioned that while the initial results from the remodeled stores are positive — with those sites seeing a couple of percentage points of a lift in sales — they will continue to monitor their performance over time.

Walmart is trying to attract more discretionary spending in the face of shoppers seeing price hikes items like paper products, according to CEO Doug McMillon.

"This stubborn inflation in dry grocery and consumable is one of the key factors creating uncertainty for us in the back half of the year, because of the cumulative impact on discretionary spending in other categories, specifically general merchandise,” McMillon said.

Walmart's first-quarter results were in contrast to the earnings that Minneapolis-based Target reported Tuesday. Comparable store sales were flat to last year in the first quarter for Target, with comparable sales growth of less than 1%. Total revenue was $25.3 billion, also an increase of less than 1%.

In its earnings report, Walmart also committed to build its own electric-vehicle fast-charging network at thousands of its locations in the United States. A number of retailers, including several convenience-store chains, are pursuing a similar strategy.

Powered By GrowthZone