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WMT Walmart Inc

60.18
-0.54 (-0.89%)
29 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type
Walmart Inc NYSE:WMT NYSE Common Stock
  Price Change % Change Share Price High Price Low Price Open Price Shares Traded Last Trade
  -0.54 -0.89% 60.18 60.77 60.17 60.66 17,558,017 00:00:00

Walmart's U.S. Boss Expects Coronavirus to Alter Shopping Permanently

20/05/2020 9:41pm

Dow Jones News


Walmart (NYSE:WMT)
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By Sarah Nassauer 

When John Furner became chief executive of Walmart Inc.'s U.S. operations last year, the biggest challenge was Amazon.com Inc.

Now Mr. Furner -- who began his career at the company in 1993 as an hourly store worker and most recently led Walmart's Sam's Club -- is leading the largest business unit at the country's largest retailer during a global pandemic, working to keep stores open and speed the company's shift to e-commerce.

This week, Walmart reported a 10% jump in U.S. sales during the most recent quarter, as shoppers stockpiled food, toilet paper and other household goods. U.S. e-commerce sales rose 74% as more shoppers switched to online ordering.

In response, Walmart has started using about 2,400 additional stores to ship out online orders in recent weeks. Walmart's separate apps for online grocery orders and Walmart.com merged into a single app this week. Prescriptions are being delivered to homes. But it has delayed plans to introduce a membership service called Walmart+ that would include fast home delivery and other perks, part of efforts to rival Amazon Prime.

Mr. Furner spoke to The Wall Street Journal from Walmart's Arkansas headquarters, where he and a handful of top executives gathered for the first time in several weeks to announce earnings.

Here are edited excerpts:

WSJ: There's been a massive shift online. How long will this buying behavior stick and how are you adjusting?

Mr. Furner: It would be hard to say exactly how long any of these changes last, although I believe many of them will be permanent. We had some periods in the quarter when we saw as much as 300% growth rates with the [online grocery] pickup business. We slowed our pickup business while we focused on replenishing and restocking stores, then we quickly added back pickup slots. We're at the highest slot level we've ever been, and we are still looking for more ways to innovate to either add more stores or more slots per store.

WSJ: How are you thinking about dislodging people further from Amazon Prime?

Mr. Furner: One of the advantages Walmart has is the store footprint, and layered on the footprint is the ability for shoppers to come in, buy off the shelf, pick up or have things delivered. Customers will continue to come back and return to shop either online or in-store as long as we deliver. It's really the nature of being an omnichannel retailer that has helped Walmart in the last few months.

WSJ: Do you think you've made progress on cracking the Amazon juggernaut in this period?

Mr. Furner: What's encouraging are the increased reshop rates in pickup -- [the rate of shoppers returning after trying out the service] -- and the reshop rates with customers online. One of the interesting things we've seen is our fastest-growing group of online pickup shoppers is customers over 50. The customer-satisfaction scores we track on our pickup business have held up pretty well throughout the quarter.

WSJ: Is Walmart+ still on the road map?

Mr. Furner: It's on the road map, for sure. We're not quite there yet. In the last couple of months, the acceleration of change from our customers is the fastest I've seen it in the U.S. It's important we continue to build for the future. Walmart+ would be a part of that.

WSJ: Where is the company culturally when it comes to the natural tension between the online and offline business?

Mr. Furner: Over the last few months, we brought the two merchandise teams together. That's had the biggest positive impact of anything we have done. It helps with supplier relationships. It helps with assortment management. It helps us with the overall ability to decide how we want to go to market.

WSJ: What role has the pandemic played in that?

Mr. Furner: The events that followed have helped us focus on the customer in a way I think is more intense. Many of the differences we may have had by (distribution) channel have been put aside. If you were in the Zoom meetings with the teams across the country, they'll be at different levels of getting along, as far as being able to approach the business as one team.

WSJ: If this version of reality lasts two years, do you keep giving bonuses to store and warehouse workers every few months?

Mr. Furner: There's just so much volatility that we decided we would pull guidance and manage the best we can month-to-month, quarter-to-quarter.

WSJ: So you're not sure?

Mr. Furner: Right.

WSJ: I'm hearing increased criticism from labor activists and some politicians over workers getting sick and, in some cases, dying. Should Walmart and other retailers do more to protect them?

Mr. Furner: We monitor this all over the country. When a hot spot occurs, we feel the impact the rest of the community would feel. We've closed some stores temporarily where we had an outbreak. We've taken the time to clean, to make sure people who needed a test had a test. We reopen with every protective measure we had going into that closure, ensuring we are providing people with [personal protective equipment]. We meter customers in. We're closing every night so we can restock and reclean.

We're taking the measures we think are very appropriate to keep people safe and distanced. We're going to continue these until we believe there's a time they won't be necessary. I don't know when that will be.

Write to Sarah Nassauer at sarah.nassauer@wsj.com

 

(END) Dow Jones Newswires

May 20, 2020 16:26 ET (20:26 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.

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