Rogers, Ark. -- Wal-Mart Stores is focused on near-term execution to grow its same-store U.S. sales, improve returns in Walmart International and leverage expenses for the full year, company president and CEO Mike Duke said Tuesday at the company’s 20th annual meeting for the investment community.
Acknowledging the challenging retail environment, Duke said: “We’re in a tough and unpredictable global economy. The competition is also tough. And the holidays are right around the corner — raising the stakes even further on serving customers and delivering on performance. All of this is to say that near-term execution is critical for us.”
Duke said that shoppers will see “fantastic new merchandise, aggressive investments in price through lots of rollbacks and better in-stock levels” in Walmart stores.
“We’re focusing on execution to deliver results,” he noted.
Duke said the company is much more streamlined in how it makes real estate decisions and invests capital. He highlighted the stronger performance of new stores and progress in bringing down the cost to build, expand and remodel stores, and also touted the progress that the company has made in e-commerce over the past year.
“The biggest opportunity we have is winning the intersection between physical and digital retail around the world,” Duke said. We’ve never been more connected across the company on e-commerce, and our results demonstrate this.”
In the first half of the year, Walmart’s e-commerce sales grew 30% globally, including a strong performance at Yihaodian in China.
Duke said that progress was made last year on a company-wide goal he set two years ago to reduce operating expenses as a percentage of sales by at least 100 basis points over five years, and that the company is committed to delivering leverage again for the current fiscal year.
Highlighting the long-term areas where the company is making progress, Duke said investments in leverage initiatives are paying off around the world. For example, the U.S. logistics team is reducing shipping costs and increasing transportation efficiency, a single process initiative is generating significant savings in labor productivity in China, and the company has migrated all but one market in Latin America to its Costa Rican Shared Services Center.
Duke also said that he was very pleased with the work Wal-Mart has done to make a difference on big global issues.
“We’ve only accelerated in the past year — with our commitments on renewable energy, to reduce certain chemicals in products and to help revitalize manufacturing in the U.S,” said Duke.