WASHINGTON — The U.S. Supreme Court ruled in the Food Marketing Institute’s favor on Monday, backing the trade group’s efforts to protect the confidentiality of the store-level data of retailers that participate in the Supplemental Nutrition Assistance Program.
The case involved a Freedom of Information Act (FOIA) request made by the Argus Leader newspaper in 2011, seeking the names and addresses of stores that participate in the SNAP program, along with each store’s annual SNAP redemption data from the fiscal years 2005 to 2010. The USDA declined to provide the store-level data, citing FOIA’s Exemption 4, which shields onfidential trade secrets and commercial or financial information from disclosure.
The Argus Leader sued the USDA, and the District Court sided with the paper, citing the standard that private information would not be deemed “confidential” unless its disclosure would cause “substantial competitive harm.”
On Monday the Supreme Court rejected that approach.
“At least where commercial or financial information is both customarily and actually treated as private by its owner and provided to the government under an assurance of privacy, the information is ‘confidential’ within the meaning of Exemption 4,” the Court ruled. In a 6-3 decision written by Associate Justice Neil Gorsuch, the Court concluded that the store-level SNAP data qualifies as “confidential” under this standard.
“We agree with the U.S. Supreme Court’s ruling today that a forty-five-year-old interpretation of what constitutes ‘confidential commercial and financial information’ required reexamination,” FMI president and CEO Leslie Sarasin said in a statement. “Our industry’s commitment to the shopper remains constant amidst seismic marketplace shifts. The nation’s grocery stores have long kept confidential the amount consumers spend at individual stores whether through payment by cash, credit, debit or the Supplemental Nutrition Assistance Program, or SNAP. This store-level sales data undoubtedly must be considered confidential because its release would provide an unfair advantage to competitors. Legislative history tells us the Freedom of Information Act, or FOIA, was created to shine a light on actions by the government, not on that of private parties, and the Court’s expressed desire to refer our case back to the lower courts demonstrates that our case sets an important precedent well beyond disclosing store-level SNAP sales in grocery. We respect the Supreme Court’s decision and we thank our amici partners and our members for their support and counsel throughout this legal journey. We appreciate the opportunity for a clear interpretation of confidentiality regarding private businesses’ commercial data.”
FMI was represented at the Supreme Court by a team from the Austin office of Baker Botts L.L.P.
“We are pleased that the Supreme Court agreed with our argument that Exemption 4 should be read according to its plain text,” said Baker Botts partner Gavin Villareal, who served as lead counsel for FMI.
Cory Myers, news director for the Sioux Falls, S.D., paper, said he was disappointed in the Court’s decision.
“This is a massive blow to the public’s right to know how its tax dollars are being spent, and who is benefiting,” he said.
FAYETTEVILLE, Ark. — Walmart is launching a new service this fall that will allow customers to get groceries delivered right into their refrigerators. Walmart president and chief executive officer Doug McMillon announced the service, called InHome Delivery, during the company’s annual shareholders meeting here.
“What’s the one thing busy families can’t buy at Walmart?” McMillon asked. “Time. Or is it? Lately, our associates have been solving problems that enable our customers to kind of ‘buy’ time by shopping with us.
“A great example is our grocery pickup and delivery capabilities, and today we announced the next phase in that journey. We asked ourselves: What if we cover not only the last mile to customers’ homes but even the last few steps? What if we put their groceries away inside their kitchens or garages? And a step beyond that, what if they let us keep them replenished, keep them in stock, on the items they use all the time?”
The way the new service will work is that customers will place their grocery orders online and then select InHome Delivery and a delivery day during the checkout process. Delivery will be made by an associate wearing a proprietary, wearable camera, who will use smart entry technology to get access to the customer’s home. “The customer is notified when we arrive at their home,” McMillon said. “Customers can watch a live first-person view of their delivery or a recording of it later.”
The InHome Delivery service will be available this fall to nearly one million customers across three cities: Kansas City, Pittsburgh and Vero Beach, Fla.
McMillon cited InHome Delivery as the kind of innovation that will help Walmart win with customers in the future.
“If I oversimplify our ability to thrive in the future, it comes down to one thing: our ability to solve problems together well enough and fast enough,” he said.
Another theme of the annual shareholders’ meeting was a celebration of the company’s associates as “extraordinary people doing extraordinary things.”
Brett Biggs, executive vice president and chief financial officer, credited Walmart’s 2.2 million associates worldwide with helping fulfill founder Sam Walton’s vision for Walmart as a merchant serving the masses through “low prices for all.”
Associates’ hard work and ingenuity helped Walmart achieve some impressive financial results in fiscal 2019, when revenue surpassed $514 billion, the company generated $27.8 billion in operating cash flow and returned $13.5 billion to shareholders through dividends and share repurchases, said Biggs, who noted that Walmart has raised its dividend in each of the last 46 years. Walmart shares on the New York Stock Exchange ended at $105.11 on the day before the annual meeting, up from $83 a share a year earlier, Biggs said. Over the past three years, Walmart’s market valuation has increased by $90 billion, he said.
In remarks delivered during the business portion of the meeting on Wednesday, Walmart president and CEO Doug McMillon said fiscal 2019 “was a strong one for Walmart.”
“Just a few years ago, our U.S. comp sales ran down for five quarters in a row, but we’ve now run up in comp sales for the past 19 consecutive quarters,” McMillon said. “Last year, excluding fuel and tobacco, Sam’s Club comps increased 5.7%, and our international markets delivered positive comps in eight of 10 markets. Our top priority is to serve customers. Sam Walton was called a merchant with a servant’s heart, and we still embody that mindset today.”
Sam’s Club CEO John Furner said he’s pleased with the direction of the warehouse clubs, which have posted 13 quarters of positive comps.
Furner said Sam’s Club is introducing new technology through a concept store — Sam’s Club Now — in Dallas that opened six months ago. Members can use a Scan & Go app to bypass the checkout. The app also uses new proprietary computer vision technology that can more easily locate barcodes on bulky passages and log the data into the shopper’s app. Furner also said Sam’s Club employees are using Ask Sam, which they can load on their own phones, to speed up their ability to help members.
Marc Lore, president and CEO of Walmart eCommerce U.S., updated shareholders on some of the company’s digital initiatives.
“Look at what’s happening at Store No. 4841, in Levittown, New York. It’s home to our Intelligent Retail Lab, where we’re testing ideas that could revolutionize retail as we know it,” he said. “Just imagine using computer vision and artificial intelligence to see your inventory levels in real time, both on the sales floor and in the back room. It will allow us to speed up section work, improve on-shelf availability and have more face-time with customers.
“And then there’s Jetblack, which we announced last year. It brings conversational commerce to life. Customers absolutely love it. Today more than two-thirds of our Jetblack members engage with us weekly, spending on average $1,500 dollars per month.”
Walmart continues to bolster its e-commerce business by shortening delivery times, Lore said. “A few weeks ago we announced NextDay delivery. It allows customers to quickly receive up to two hundred thousand of our top items. The incredible thing is, it costs us less to deliver orders the next day, because items come from a single fulfillment center located near the customer, and orders arrive in one box. NextDay delivery is pretty awesome, but we can deliver groceries even faster — same day.”
Greg Foran, president and CEO of Walmart U.S., thanked associates for their work in implementing the technology being developed to make shopping more convenient.
“You’ve heard me talk about the importance of principles, and how principles don’t change. One of the principles I’ve come to rely on more and more over the past few years is this — success,” he said. “Success‚ in probably all areas, including families, schools, sports teams and businesses of all sizes, depends on having some kind of a personal relationship. Personal relationships are the only way we can uphold the principles upon which our founder, Sam Walton, built our company. And to be perfectly honest, I think personal relationships are the basis for how we, as Walmart, or anyone else for that matter, can uphold many of the values which bring out the best of humanity.
“If each of us builds those kinds of relationships reasonably well, we can help make a meaningful difference in people’s lives, and in the neighborhoods where they live and work. And by doing that honestly — by doing that well — we create a spark.”
WOONSOCKET, R.I. — The executive team of CVS Health outlined a series of transformation initiatives at its 2019 Investor Day event earlier this month, showing how the company plans to accelerate enterprise growth, simplify a consumer health system that is confusing and inconvenient, and position the company for long-term growth and increased shareholder value. The company also provided greater insight into near- and long-term earnings potential.
“Our goal is to fundamentally transform the consumer health experience for the millions of Americans we interact with every day, while creating value for our patients, members, partners and shareholders,” said CVS Health president and chief executive officer Larry Merlo. “We have combined with Aetna to build a powerful and unique business model that will guide our journey to becoming the most consumer-centric health company.”
Merlo added that CVS Health is dedicated to putting consumers at the center of its strategy and helping them achieve their best health by strengthening health care locally and making it simpler to use and understand.
The CVS Health management team said that it is focused on growing and differentiating CVS Health’s businesses, with a focus on driving engagement through personalization; winning in high-growth products and services; and delivering new and innovative benefit designs and reimbursement models.
One of the major announcements the drug chain made was that it will open 1,500 HealthHUB stores by the end of 2021.
CVS opened its first three HealthHUB locations in Houston in February. It said it plans to open more in Houston, Atlanta, Philadelphia, southern New Jersey and Tampa, Fla., by the end of the year.
“We’re pleased with the customer feedback we’ve received on the HealthHUBs,” said CVS Pharmacy president Kevin Hourican. He pointed out that these stores have seen higher traffic in the MinuteClinics, increased sales in the front of the store and more prescription volume.”
Hourican explained that the company is expanding HealthHUBs to build on the success of its pilot program in Houston.
HealthHUBs include an expanded health clinic, with a lab for blood testing and health screenings. There are also wellness rooms for yoga and seminars as well as dietitians and respiratory specialists on staff.
The retailer said it will also be taking advantage of the unmatched breadth of its capabilities to introduce new products and services. CVS Health will optimize government programs, introduce new risk-based carve-outs, develop programs aimed at complex conditions like chronic kidney disease and create new analytics products.
The company is building a robust technology infrastructure designed to support transformational initiatives and protect its data. CVS Health said it will deploy that data across the organization to create a holistic view of the patient, which will offer insights on how to communicate with the patient most effectively, including providing the next best action they can take to improve their health.
Noting that CVS Health was realizing cost savings by modernizing enterprise functions and integrating operations following the Aetna transaction, chief financial officer Eva Boratto discussed how a focus on synergies and modernization will drive a more efficient company, and how investments in technology and new products will create long-term value.
“We are continuing to drive significant synergies and cost savings across the entire enterprise as we execute our integration plans,” Boratto said. “Going forward, we also have truly exciting opportunities to introduce programs and products that will change the way people think of and address their health.”
CHESAPEAKE, Va. — Dollar Tree Inc. last month began adding items costing more than a dollar at select Dollar Tree stores as it weighs whether to revise its commitment to a single price point.
The multi-price-point merchandise is being displayed in sections branded as Dollar Tree Plus to clearly differentiate it from the stores’ $1 assortment.
“This carefully considered test, leveraging the merchandising strength and purchasing power of Family Dollar, is designed to understand how Dollar Tree’s deeply loyal customers respond to the addition of merchandise at values greater than $1,” the company said last month in a news release summarizing financial results for the first quarter of fiscal 2019.
“With its ‘Everything’s a Dollar’ model, Dollar Tree has remained one of the most unique, differentiated and defensible brand concepts in all of value retail,” commented Dollar Tree president and chief executive officer Gary Philbin in the release. “However, we have always been a ‘test and learn’ organization that is committed to evaluating all opportunities to deliver great value for our customers while driving long-term value creation.
“During this test, we look forward to measuring and assessing the initial results and understanding if the introduction of multiple price points across a broader set of stores is in the best interests of our customers, company and shareholders.”
Dollar Tree executives said the initial test phase will be ex-
panded to involve more than 100 urban, suburban and rural Dollar Tree locations.
Aside from a limited trial many years ago, Dollar Tree’s $1 cap has held steadfast over the company’s 33-year history, while rivals including Dollar General have sold items at higher prices as a way to address inflation and upgrade merchandise quality.
Meanwhile, Dollar Tree continues to execute a store optimization program aimed at improving the performance of its Family Dollar stores.
The retailer last year tested a new format for new and renovated Family Dollar stores, called H2 internally, and executives said they were encouraged by the results. The format includes a $1 Dollar Tree merchandise section, an expanded party assortment and an increased number of cooler and freezer doors. H2 stores are delivering increased traffic and comparable-store sales increases of more than 10%, the company said, adding that H2 stores perform well in a variety of locations, especially where Family Dollar has been most challenged in the past.
As of May 4, the company had 550 H2 stores, up from 200 at the start of the first quarter. Dollar Tree officials said they expect H2 renovations for at least 1,000 Family Dollar stores in fiscal 2019.
Dollar Tree continues to close underperforming Family Dollar stores, with as many as 390 expected to be shuttered by fiscal year-end. It also expects to re-banner some 200 Family Dollar stores to the Dollar Tree brand this year.
As part of the optimization, the company said it plans to sell alcohol at about 1,000 Family Dollar stores. Adult beverages were introduced at 45 stores in the first quarter.
Consolidated net sales increased 4.6% to $5.81 billion in the first quarter, while gross profit increased 1.6% to $1.73 billion, the company reported.
“I am proud of our team’s efforts throughout the first quarter,” Philbin said. “Dollar Tree delivered a solid 2.5% increase in same-store sales while cycling its toughest quarterly comparison from the prior year. And Family Dollar again demonstrated a sequential acceleration in comp sales.
“Dollar Tree continues to be a destination for customers looking for great values and convenience, as demonstrated by our 45th consecutive quarter of delivering an increase in same-store sales.”
WASHINGTON — U.S. retail sales increased 0.5% in May (seasonally adjusted from April), and were up 3.2% unadjusted year over year, according to the National Retail Federation.
May’s retail sales increases were broad based, with every category except food and beverage stores showing a gain from April, NRF said. The numbers exclude sales at automobile dealers, gasoline stations and restaurants.
Revisions to April monthly data were significant, NRF said, with retail sales reversing a loss of 0.2% to a gain of 0.3%.
“Today’s retail numbers, and upward revisions to prior months, reinforce the ongoing strength of the consumer and are consistent with a pick up in the pace of the economy in the coming months,” said Jack Kleinhenz, chief economist at NRF. “The strong job market, recent income gains and elevated confidence translates into ongoing support for spending. Households, in the aggregate, are in solid financial condition but an escalation in trade tariffs will undoubtedly create a considerable downdraft to confidence and spending, or lead to a pullback in spending.”
NRF characterized recent retail sales data as unusually choppy due to an economic environment that included a partial government shutdown, volatile energy prices, roller-coaster equity markets and escalating trade tensions.
The NRF’s numbers are based on data supplied by the U.S. Census Bureau.
Specifics from key retail sectors during May include:
• Stores that sell groceries and beverages were up 2.3% year over year but were down 0.1% month over month, on a seasonally adjusted basis.
• General merchandise stores were up 4.4% year over year and up 0.7% month over month, seasonally adjusted.
• Health and personal care stores were up 3.8% year over year and up 0.6% month over month, seasonally adjusted.
• Clothing and clothing acces-
sory stores were down 2.4% year over year and unchanged month over month, seasonally adjusted.
• Online and other non-store sales were up 11.4% year over year and up 1.4% month over month, seasonally adjusted.
• Furniture and home furnishings stores were up 1.2% year over year and up 0.1% month over month, seasonally adjusted.
• Building materials and garden supply stores were down 1.4% year over year but up 0.1% month over month, seasonally adjusted.
• Electronics and appliance stores were down 1.9% year over year, but were up 1.1% month over month, seasonally adjusted.
• Sporting goods stores were down 2.4% year over year but up 1.1% month over month, seasonally adjusted.
BENTONVILLE, Ark. — Just over two years after Walmart acquired Jet.com, the retailer is now taking steps to more fully integrate the e-commerce platform into its own business.
As part of the planned changes, Simon Belsham’s role as Jet president will be eliminated, and Jet team leaders will now report to Kieran Shanahan, who has been overseeing Walmart’s food, consumables, and health and wellness divisions online.
Walmart said it will merge the rest of Jet’s teams — including retail, marketing, technology, analytics and product — within Walmart.
“We don’t have the same need for a dedicated leader,” at Jet anymore, said Marc Lore, the co-founder of Jet.com who now serves as the head of Walmart’s e-commerce business in the U.S.
Belsham will remain with the company until early August to help with the transition, Lore said. “This natural progression of integrating an acquisition allows us to fully leverage Walmart’s assets for Jet and leverage Jet’s talent for Walmart,” he added.
LAKELAND, Fla. — Publix Super Markets Inc. has opened the second of its refashioned GreenWise Market stores, in Mount Pleasant, S.C.
GreenWise Market is a specialty, natural and organics format featuring grab-and-go options, organic produce, indulgent gourmet treats, local and unique products, bulk items, body care offerings, and products made in- house, such as smoked meats and sausages.
“We’re excited to bring the simple, yet sophisticated, environment and high-quality, unique products of GreenWise Market to the Mount Pleasant community,” says Kevin Murphy, president of Publix. “GreenWise Market is more than a store. It’s a gathering place where our customers can discover local items, indulge in a decadent treat or find the items they need to support their healthy lifestyle.”
Publix opened the first of its refashioned GreenWise stores last year in Tallahassee, Fla., near Florida State University.
The second location, in Mount Pleasant’s new Indigo Square shopping mall, is a place where customers can buy a glass of wine, a locally brewed beer, coffee, tea or a smoothie to enjoy while they shop or in one of the store’s seating areas, according to a spokesman. It has a sandwich bar and burrito line for the lunch crowd. The store also includes a three-panel mural by local artist Amelia Rose Smith, featuring painted scenes from nearby Sullivan’s Island and Isle of Palms.
Publix has announced plans to extend the GreenWise Market concept to eight additional locations, each at around 25,000 square feet. Three of the stores — in Lakeland and Boca Raton, Fla., and in Mountain Brook, Ala. — are slated to open later this year. Opening dates have yet to be set for GreenWise Market stores in Marietta, Ga., and in Fort Lauderdale, Odessa and Nocatee, Fla.
The company introduced the GreenWise concept in 2007 with three stores that were focused on organic and natural offerings, as well as prepared food items. In 2010, Publix switched gears, designing new stores under a “hybrid” format that incorporated elements from the GreenWise Market test stores into traditional Publix supermarkets, and attaching the GreenWise name to organic, natural and better-for-you private label products sold in its traditional supermarkets.
Employee-owned Publix operates 1,215 stores in Alabama, Florida, Georgia, North Carolina, South Carolina, Tennessee and Virginia, up from 1,182 a year ago. The company cited contributions from new stores in the 4.3% sales increase it posted in its first quarter, ended March 30. Higher prices contributed to a 1.9% increase in comparable-store sales, the company states in its 10-Q filing with the Securities and Exchange Commission.
“I want to thank our associates for delivering premier customer service that makes shopping at Publix a pleasure,” says Public chief executive officer Todd Jones.
BOISE, Idaho — Albertsons Cos.’ Signature Select brand is amping up its presence across stores with the addition of more than 300 new products and updated branding in 2019.
The redesigned products are longtime favorites from the Signature Kitchens, Signature Home, refreshe and The Snack Artist brands. Streamlining these products into Signature Select’s robust portfolio of 2,400-plus products provides greater consistency in every aisle, according to the company.
In addition to Signature Select, shoppers can find Signature Farms in meat and produce, Signature Cafe for prepared meals and sides in the deli, Signature Care for personal items, and the ultra-premium Signature Reserve, to surprise and delight with uniquely crafted products for life’s exceptional moments.
“Our Signature family of brands aren’t like your parents’ store brands anymore,” said Geoff White, president of Albertsons Cos. Own Brands. “We are laser focused on innovation and staying at the forefront of culinary trends. Customers should expect to see trends first at our stores. With the expansion of Signature Select, customers will find even more surprises, from seasonal and holiday items to ethnic and even plant-based offerings.”
The new branding includes a refreshed rendition of Signature Select’s trademark tag. The overall design allows for flexibility in the packaging architecture in each category, so the products can stand out and compete effectively wherever they’re found throughout the store.
“With a brand that extends across many diverse categories throughout our stores, we needed to create a design system with a recognizable brand presence that also allows for individuality across categories,” said Bill Luna, director of brand design and packaging operations. “The Signature tag provides an iconic and consistent brandmark that sits naturally on distinctive designs and reflects the unique qualities of each product in each category.”
BENTONVILLE, Ark. — Walmart in recent weeks announced the hiring of two technology executives, including Suresh Kumar, a former Google vice president who is set to become chief technology officer and chief development officer on July 8. Walmart also said it had hired Scott Eckert to run its investment arm and startup incubator known as Store No. 8.
Kumar brings 25 years of leadership experience from his work at technology companies including Amazon, IBM and Microsoft.
“The technology of today and tomorrow enables us to serve our customers and associates in ways that weren’t previously possible. We want to take full advantage of those opportunities,” Doug McMillon, Walmart’s president and chief executive officer, said in a statement. “Suresh has a unique understanding of the intersection of technology and retail, including supply chain, and has deep experience in advertising, cloud and machine learning. And he has a track record of working in partnership with business teams to drive results.”
At Google, Kumar served as vice president and general manager of display, video, app ads and analytics.
He earlier worked at Microsoft as corporate vice president of cloud infrastructure and operations.
Kumar spent 15 years at Amazon in various roles, including vice president of technology for retail systems and operations. He also led Amazon’s retail supply chain and inventory management systems.
Kumar worked as a research staff member at the IBM Thomas J. Watson Research Center.
He earned a Ph.D. in engineering from Princeton University and a bachelor’s degree in technology from the Indian Institute of Technology, Madras.
“Walmart is one of the great success stories in how a company evolves over time to serve the changing needs of its customers, and today it is in the midst of a very exciting digital transformation,” Kumar said in a statement. “With more than 11,000 stores, a high-growth e-commerce business and more than 2 million associates worldwide, the potential for technology to help people at scale is unparalleled, and I am excited to be part of this.”
Kumar will report to McMillon and will work primarily out of Walmart’s offices in Sunnyvale, Calif.
Eckert will work to expand Walmart’s e-commerce business in partnership with retail startups, venture capitalists and entrepreneurs, said Marc Lore, CEO of Walmart U.S. e-commerce.
Eckert will be based in Hoboken, N.J., and will report to Lore.
He takes over for Lori Flees, who ran Store No. 8 in addition to being senior vice president of health and wellness for Sam’s Club. Flees will continue her role at Sam’s Club.
Eckert spent five months earlier this year as executive in residence at Bain Capital Ventures. Previously, he spent more than eight years as president and CEO at Boston-based Rethink Robotics. He also cofounded Motion Computing and worked as a general manager for Dell’s worldwide e-commerce business unit.
Eckert earned an MBA from Harvard Business School and a bachelor’s degree in quantitative economics from Stanford University.
Walmart continues to invest aggressively in digital commerce. It has made a string of acquisitions of e-commerce companies, including Jet.com, Art.com, lingerie brand Bare Necessities and plus-size retailer Eloquii, and it has been moving swiftly to bolster its online grocery business.
Walmart held the series of events that comprise its annual meeting earlier this month on its home turf in northwest Arkansas, and, according to a well-established pattern, the occasion afforded the company the opportunity to celebrate its accomplishments, recognize its workforce and look to the future. Walmart’s eminence as the world’s biggest retailer has long ensured that the associate and shareholders meeting attracts a great deal of scrutiny, from both fans and critics of the organization, a fascination that has intensified along with the company’s rivalry with e-commerce giant Amazon.
This year was no exception. Vermont Senator Bernie Sanders, who is running for the Democratic presidential nomination, appeared at the formal business meeting where stockholders cast votes on proxy proposals. He used the forum to denounce the company’s compensation practices for hourly store associates.
“Walmart pays many of its employees starvation wages,” Sanders asserted. “Surely, with all that,” he added, alluding to the company’s half-a-trillion dollars a year in revenue and the wealth accumulated by the family of founder Sam Walton, “Walmart can afford to pay its workers a living wage of $15 an hour.”
Executives took the politically motivated appearance in stride. After acknowledging Sanders’ presence, chief executive officer Doug McMillon, who started his career at the retailer 28 years ago as a part-time worker, cited the steps the company has taken to improve compensation for associates. “We’ve moved up our starting wages in the U.S. by 50% in the last four years, and we continue to adjust on a market-by-market basis to recruit and retain the talent we need to run a good business,” he said. “In fact, over the last four years, we’ve invested an incremental $4.5 billion in pay, beyond our traditional wage increases, for our U.S. and club associates.”
McMillon went on to remind Sanders and other members of Congress that they too have an important role to play in how much compensation workers receive: “It’s clear by our actions and those of other companies that the federal minimum wage is lagging behind — $7.25 is too low,” noted McMillon. “It’s time for Congress to put a thoughtful plan in place to increase the minimum wage.”
McMillon’s response to Sanders’ comments typifies his approach to running Walmart — tackle an issue head-on; assess and, if the situation requires it, explain the company’s current position in relation to the challenge; and look for ways to enhance that position as part of an overarching process of continuous improvement. The plan of attack has brought about a new mindset at Walmart, one that has seen the quintessential discount store operator remake itself for a marketplace transformed by technology.
“Retail history teaches us that those that fail to adapt will struggle and eventually perish,” McMillon said at the annual meeting. “So these past few years, we’ve made significant investments to put us on a stronger path.
“We’ve invested in our associates with higher pay, training and education; in new technology for our associates; in lower prices for our customers; and in our e-commerce business to help ensure our future.”
Since McMillon became CEO in 2014, Walmart has, indeed, made great strides in all those areas. An insider who early in his career crossed paths with Sam Walton, McMillon has proven himself the right person to build on the company’s storied past by refashioning its guiding principles for the new digital era.
“Sam Walton was a problem solver,” recalled McMillon. “Sam thought people who lived in smaller towns deserved low prices on a broad assortment of quality merchandise, just like people who lived in larger towns. He saw the intersection of these ideas.”
Fast-forward to today, when McMillon and his team are applying the problem-solving mentality that motivated the company’s founder to the evolving needs of contemporary consumers. “Walmart creates opportunity,” McMillon said. “We don’t shy away from problems. They actually are opportunities. We embrace them. We grow and change. We adapt.”
Those words are an accurate description of Walmart in recent years. Thus far, the company has succeeded in reorienting a massive organization and aligning it with the imperatives of the new omnichannel marketplace in impressive fashion. The task they now face is maintaining and accelerating that momentum.
Competitors will not give Walmart time to rest on its laurels. Amazon, the catalyst for the latest revolution in mass market retailing, just as Walmart itself was for the previous one, remains a relentless innovator. And many of Walmart’s traditional rivals in the realm of brick-and-mortar retailing, including Target, Kroger and Albertsons Cos., are working hard to allow their customers to shop whenever, wherever and however they choose. McMillon understands that, in order to stay ahead of the field, Walmart will have to continue to innovate, and do so at an even faster pace than it has over the past five years.