TBO.com - TBO is Tampa Bay Online

Slimmer Supercenters In Wal-Mart's New Vision

ADVERTISEMENT

By MARY SHEDDEN | The Tampa Tribune

Published: October 24, 2007

The mega-retailer's plans include more stores, many of them smaller supercenters or neighborhood markets, and older-store rehabs.

TAMPA - Wal-Mart Stores became famous for low-price general merchandise.

Future stores, however, will better resemble a neighborhood grocer.

The world's largest retailer is openly deviating from its successful low-price big-box approach by tailoring its new or upgraded stores to better fit neighborhoods it is trying to serve. Expect to see fresh food showing up in more stores as new Wal-Marts are added and old stores are upgraded.

The company on Tuesday updated its national growth plans, including the end of its one-time stalwart discount stores. In 2009, plans include an increasing number of Neighborhood Market grocery stores and more supercenters. After 2008, no new discount stores will open.

'The company will focus on expansions and relocations of existing discount stores to supercenters, which will result in building fewer new stores,' Eduardo Castro-Wright, Wal-Mart Stores U.S. president and chief executive officer, said in a statement. 'We also are building smaller supercenters.'

The company said Tuesday that it will open 195 supercenters nationwide next year, down 30 percent from 2007.

In the Tampa Bay area, that is likely to translate into smaller urban supercenters, small convenient grocery stores, and discount centers that offer more fresh groceries, company spokeswoman Quenta Vettel said.

'It's an evolution as to what we're doing,' she said.

For example, a Wal-Mart Supercenter planned for St. Petersburg is about half the size of a traditional 220,000-square-foot location. And a longtime discount center near the busy junction of Interstate 275 and North Dale Mabry Highway is being eyed as a place to offer fresh groceries, she said.

The strategy reflects a realization that customers want a different store than Wal-Mart first offered, said David Urban, a marketing professor at Virginia Commonwealth University. Also, it may signal a retreat from the politically unpopular reception whenever the retailer would announce plans to build another big-box store.

'After a while in the life cycle of a retailer, they have to look at what they have to do to enhance,' he said.

This evolution away from the discount model that made Wal-Mart famous has been gradual.

Over the past several years, most new stores introduced in the Tampa Bay area have been supercenters - general merchandise and grocery stores. In fact, the local supercenters now outnumber discount stores 17 to 12.

Expect those discount centers to eventually be upgraded or relocated, Vettel said. Groceries will be a key element added to those older locations, she said.

The strategy to include groceries reflects the fact that Wal-Mart's supercenters attract nearly 22 percent of local grocery shoppers, according to the monthly Shelby Report trade publication.

Sales at the 17 supercenters outpace performance for traditional grocers with far more locations, such as Sweetbay Supermarket, Winn-Dixie and Albertsons.

Another Wal-Mart concept called Neighborhood Markets also will show up in more locations. Areas such as Pasco County are seen as a good match for the grocery markets focused on offering supercenter-type products in a smaller convenient format.

'It's a concept we think will work very well,' Vettel said. There are two Wal-Mart Neighborhood Markets in the Bay area. The company plans to open 84 more in the United States by 2010.

Urban said Wal-Mart understands it has to respond more to specific customer demands for products that reflect regional and cultural demographics.

Offering the same products in each store doesn't work anymore - especially in the food categories, he said.

'Value is not just defined by price anymore,' he said.

Vettel pointed to a Central Tampa Supercenter as a good example of Wal-Mart's more sophisticated distribution center. The store's 60 percent Hispanic customer base led to an inventory that includes products such as Cuban bread and Catholic saint candles, she said.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT