BENTONVILLE, Ark. — Walmart entered 2024 moving simultaneously on several fronts to advance its transformation into a new kind of retailer — indeed, a new kind of business enterprise. At the same time, the company is re-emphasizing the importance of its retail roots with plans to resume opening stores in the United States.
At a number of recent industry forums, executives have described current activities and future plans and the vision that inspires them.
Over the course of the last decade, the company that began as a general merchandise discount store operator has entered several new fields, including financial services, technology development and health care clinics, to name just a few. During the Walmart Keynote presentation at the Consumer Electronics Show (CES), president and chief executive officer Doug McMillon acknowledged that he is often asked to describe what Walmart is today. He provided a succinct characterization of the company that included its core values.
“We are a people-led, tech-powered, omnichannel retailer dedicated to helping people,” he said. “We want to help people live better. That starts with saving them money, but it doesn’t stop there. Simply put, our team is dedicated to helping people improve their lives.”
McMillon invoked founder Sam Walton’s vision of helping people to save money and live better. “Sam challenged us to design our business to make a bigger, more positive difference in our world,” he said. “That’s what inspires us to solve problems and address our own imperfections.”
While much of the discussion at CES centered on Walmart’s enormously ambitious digital initiatives, McMillon returned to the broader vision that now propels the company. “We believe we can and should help people live better beyond just saving time and money,” he elaborated. “We believe we can do more. We want them to be healthier, and do more than sell fresh, affordable food and operate pharmacies, so we’re exploring additional ways to help provide care, like operating health care clinics.”
In recent years Walmart has eschewed any major expansion of its U.S. store base, opting instead to invest in new opportunities and, significantly, in its associates. Last year, however, it developed a new Store of the Future concept, which it rolled out in 117 stores last October at a cost of half a billion dollars.
The new prototype was designed to persuade shoppers to buy more discretionary items such as electronics and home goods, which carry higher profit margins than the consumable categories that make up the bulk of sales. However, the stores also include “dollar shops” intended to compete with dollar stores for the business of lower-income shoppers.
Apparently the concept has met executives’ expectations, because Walmart has announced plans to build or convert more than 150 stores over the next five years, in addition to continuing its regular store remodel program. According to Walmart U.S. president and CEO John Furner, the retailer will remodel 650 stores in 47 states and Puerto Rico this year.
“We’re also finalizing construction plans on 12 new projects we intend to start this year, along with converting one of our smaller locations to a Walmart Supercenter,” Furner wrote in a blog post. “Our new and remodeled stores will reflect Walmart’s Store of the Future concept, featuring improved layouts, expanded product selections and innovative technology to help our associates better support our customers and make shopping more convenient and enjoyable. Customers love this concept in the places we’ve already rolled it out, and we’re excited to transition more and more of our fleet.”
Furner added that the new stores are being designed with sustainability in mind, including more energy-efficient equipment and lighting. The company is also developing a coast-to-coast network of affordable electric vehicle fast-charging stations.
The decision to move into growth mode at Walmart U.S. followed a similar decision last year to resume opening Sam’s Club membership warehouse clubs. The division plans to open 30 clubs across the country, some in new markets, over the next few years. The expansion will be supported by the construction of five new fulfillment and distribution centers.
In addition to investing in its brick-and-mortar assets, Walmart is raising salaries and benefits for its U.S. store managers. The average salary for a store manager will rise to $128,000 from $117,000, while bonuses could be as much as 200% of base salary, depending on factors including store profitability. In addition, managers will be eligible for grants of up to $20,000 in company stock every year, depending on the store format.
“It’s fair to say that we’re asking them to act like owners and to think like owners,” Furner told reporters at a briefing. He added that turnover among managers has stabilized since 2022.
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