Copyright 2009 Little Rock Newspapers, Inc.

October 22, 2009 Thursday

BUSINESS

541 words

STEVE PAINTER ARKANSAS DEMOCRAT-GAZETTE

Wal-Mart Stores Inc., already the world's largest retailer, is committed to growing the company's footprint in the United States and globally, company executives told retail analysts Wednesday.

"Our f irst priority is growth," Mike Duke, president and chief executive officer, said as the company hosted analysts at the John Q. Hammons Convention Center in Rogers, an annual company event. The meeting continues today.

"Wal-Mart continues to have aggressive growth plans, let there be no doubt," Duke said.

Wal-Mart has gained market share from competitors during the recession by focusing on prices and refreshing its stores with an ongoing remodeling program.

Duke said the company will introduce "new, innovative formats" that will open opportunities for the company in urban U.S. markets that it has yet to penetrate.

The company already has been slowly shrinking the size of its flagship supercenters, which have typically approached 200,000 square feet and offer a broad range of groceries and general merchandise.

"The writing is on the wall, we are going to smaller stores," said Eduardo Castro-Wright, Wal-Mart vice chairman in charge of U.S. stores.

Figures provided to analysts show that Wal-Mart is adding 14 million square feet of U.S. store space this year, down from 23 million square feet a year earlier. The company plans to add 11 million square feet next year, according to the presentation.

In addition to supercenters, Wal-Mart operates generalmerchandise discount stores, a format it is no longer adding to its store base; Sam's Club, a members-only warehouse outlet; Neighborhood Markets, a traditional supermarket format; Marketside, four small-scale food markets it is testing in Arizona; and two Supermercado stores, which cater to Hispanic shoppers.

Castro-Wright said the company is "very pleased" with the Supermercado format and will build more in areas with sufficient Hispanic population.

While the meeting with analysts was under way, Wal-Mart issued a news release saying it intends to announce new price cuts weekly through the Thanksgiving and Christmas holiday period for both food and general merchandise.

John Fleming, executive vice president and chief merchandising officer, said the critical Christmas shopping season will be a challenge, given the economy.

"It's going to come, it's going to be tough, it's going to be late and I like our chances," he said.

Wal-Mart's international division will continue to grow in "an intelligently aggressive manner," said Doug McMillon, president and chief executive officer of the division, which had 3,859 stores as of the end of September. The company's goal, he said, is to be the No. 1 or No. 2 retailer in any market it enters.

Stephen Quinn, chief marketing officer, said customer surveys show that 69 percent of shoppers are "price sensitive," up from 56 percent in 2006.

"That is really good news for Wal-Mart," he said.

Quinn also said the company will announce an initiative next week with the social media Web site Facebook.

"We're going to be very big in digital," he said.

Wal-Mart's stock closed Wednesday at $50.63, down $1.07 or 2.07 percent, on the New York Stock Exchange. It has traded between $46.25 and $59.23 in the past year.

This article was published 10/22/2009

October 22, 2009