Wal-Mart growth plan continues on schedule
June 1, 2001-- Home Textiles Today,
FAYETTEVILLE, AR — Acknowledging the difficult retail environment, Wal-Mart executives sounded a familiar theme at the company's annual shareholders meeting: We still have room to grow.
Noting that Wal-Mart captures "only about 7 percent" of total retail sales in the United States, company president and ceo Lee Scott identified growth as one of the company's fundamental imperatives.
"We can't back off on growth. We are committed to adding new stores and new clubs, and we are committed to remodeling existing units," he said. "This is a company whose opportunity for future growth is unparalleled."
The company foresees aggressive U.S. growth as well as in its expanding overseas operations, said Tom Coughlin, president and ceo of the Wal-Mart Stores division, which includes discount stores, supercenters and the Neighborhood Market convenience format. Wal-Mart's real estate division has identified 2,655 potential new locations, he told analysts following the meeting. And the company will open its 1,000th supercenter during July.
"There is still unit-growth potential out there," he said.
Both Coughlin and Scott warned that in the aftermath of consolidation, the remaining retail players represent tougher competition.
"The weaker links are dropping out because they can't compete. The bar is getting higher," Scott told shareholders and thousands of company associates packing Bud Walton Arena here. He urged them to look at the best of the competition, mentioning Lowe's, Costco, Best Buy and Carrefour by name.
Closely tracking the competition on a market-by-market basis is already paying off, Coughlin said. He noted that 99.8 percent of the company's stores have representatives in a competing Kmart every week; and 98.7 percent of stores have a representative in a competing Target every week. "What we need to ask ourselves is why isn't that 100 percent?" he added.
Executives made it clear both during the meeting and at the analyst's conference afterward that the company will continue to rely on price to drive traffic. The number of items offered at opening price points are expanding, and price rollbacks this year will account for $11 billion to $12 billion of merchandise.
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