After decades of seemingly unstoppable growth, the world’s largest retailer has hit an impasse: supercenter expansion is increasingly cannibalizing existing stores (same store sales growth dipped below 2% for the first time in Wal-Mart’s history last year), and an aggressive plan to capture a greater proportion of “upmarket” sales fell flat. Even the international division, which drove exceptional growth, experienced setbacks, as Wal-Mart pulled out of both Germany and South Korea.
The company is now regrouping and is charting a new course for growth that leverages brand equity as a low price leader and core assets, such as the pharmacy.
This issue of Times & Trends explores drivers of Wal-Mart performance and early results of key strategic initiatives. The report also highlights new opportunities and risks for CPG manufacturers and retailers resulting from Wal-Mart’s new growth plan.