Friday
June 1, 2007
Wal-Mart to cut back on expansion
Over at Big Box Watch, I’ve noted that Wal-Mart has announced that they are scaling back their expansion efforts. New store growth will be reduced to 170 supercenters next year, down from 270 stores that they had originally planned to open this year.
This move by Wal-Mart is a long time coming. The rate that the retailer grew eventually would have to end. Wal-Mart needs to reevaluate their offerings and fuel growth from within, rather than fuel growth with new stores. Their comp store sales have not been strong in a long time, and now they have to figure out way.
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Wal-Mart’s growth is slowing because the company is Locked-in to doing what it always did, rather than reacting to market needs. Now management is investing in buying back shares rather than new store concepts that would be more competitive with Target, Kohl’s, et.al. The company is attacked on many fronts, even by former executives, not because it is large but because it refuses to listen to customers, employees or suppliers. Read more at http://www.ThePhoenixPrinciple.com
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