Wal-Mart’s original small format celebrates 10th anniversary

PINELLAS PARK, FLA. —While the eyes of the supermarket industry are focused on Tesco’s Fresh and Easy concept and Walmart’s new Marketside format, another Walmart format once regarded as a growth vehicle will observe its 10th anniversary.

It was 10 years ago this month that Walmart opened its first Neighborhood Market and in doing so, prompted the type of speculation that now exists around Marketside regarding how quickly the company would grow the 40,000-square-foot units. It turned out to be not very fast, as there are approximately 150 Neighborhood Markets in operation and no clear indication has been offered that expansion will accelerate in coming years.

Even so, recent store openings illustrate the type of opportunity that exists for Walmart to open smaller-store formats. A 39,000-square-foot Neighborhood Market that opened last month in the St. Petersburg, Fla., suburb of Pinellas Park sits adjacent to a Walgreens pharmacy and was constructed so that customers see the dual drive through lanes of the Neighborhood Market pharmacy when they enter Walgreens. The other interesting aspect of the store is that it is less than a mile from Walmart’s supercenter in Pinellas Park, a store that for several years running had the distinction of being Walmart’s highest-volume location, with annual sales in excess of $160 million.

The new Neighborhood Market’s proximity to an existing high-volume supercenter is indicative of the strategy that was envisioned when the smaller format was created, so customers could use it for fill-in shopping trips between visits to the supercenter. Walmart may not have a lot of Neighborhood Markets on the street, but the potential remains and can be seen first hand in the Tampa Bay area, where two more stores are planned to open before the end of Walmart’s fiscal year. There are currently 21 units throughout Florida.