Blog: Petah MarianFood leads the way in Wal-Mart US turnaround

Petah Marian | 24 February 2011

As Wal-Mart works to turnaround its US stores, it can be buoyed by the improvement in its food division, which suggests plans to re-rationalise its range are likely to be a success.

While Wal-Mart recorded "disappointing" fourth-quarter results from its US division, the CEO of the retailer's US division, Bill Simon, said it recorded positive low-digit comps in its food business over the quarter.

He attributed the gains to the additional assortment the company brought back into grocery, which he said "increased our relevancy for customers".

"We brought back many opening price point items that were important to our core customers to help generate traffic and loyalty. The modular changes for SKU add-backs in food were mostly completed by November and contributed to better sales," he said.

Simon said that plans to re-assort its general merchandise categories will "take longer than it did on the food side of the business" and that with the longer lead times in general merchandise the company will be working on this throughout the year.

"Our goal is to gain traction on these before we get into the general merchandise rich fourth quarter," he said.

So it seems as though there is unlikely to be a quick fix for the company's US division, and for industry-watchers expecting an imminent turnaround company's overall US performance, it is likely they will have to wait until the fourth quarter of 2011.



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