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 Walmart's Project Impact: A Move to Crush Competition

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PostSubject: Walmart's Project Impact: A Move to Crush Competition   Wed Sep 09, 2009 8:41 pm

Walmart's Project Impact: A Move to Crush Competition


By SEAN GREGORY / WEST DEPTFORD, N.J. Sean Gregory / West Deptford, N.j. – 2 hrs 52 mins ago


Walmart loves to shock and awe. City-size stores, absurdly low prices ($8 jeans!) and everything from milk to Matchbox toys on its shelves. And with the recession forcing legions of stores into bankruptcy, the world's largest retailer now apparently wants to take out the remaining survivors.


Thus, the company is in the beginning stages of a massive store and strategy remodeling effort, which it has dubbed Project Impact. One goal of Project Impact is cleaner, less cluttered stores that will improve the shopping experience. Another is friendlier customer service. A third: home in on categories where the competition can be killed.

"They've got Kmart ready to take a standing eight-count next year," says retail consultant Burt Flickinger III, managing director for Strategic Resources Group and a veteran Walmart watcher. "Same with Rite Aid. They've knocked out four of the top five toy retailers, and are now going after the last one standing, Toys "R" Us. Project Impact will be the catalyst to wipe out a second round of national and regional retailers." (See 10 things to buy during the recession.)


Though that's bad news for many smaller businesses that can't compete, Walmart investors have clamored for this push. Despite the company's consistently strong financial performance, Wall Street hasn't cheered Walmart's growth rates. During the 1990s, the company's stock price jumped 1,173%. In this decade, it's down around 24% (Walmart's stock closed at $51.74 per share on Sept. 3). "Walmart is under excruciating pressure from employees and frustrated institutional investors to get the stock up," says Flickinger. (Read "Can Toys "R" Us Sell Toilet Paper?")


Many analysts believe that the store-operations background of new CEO Mike Duke will keep investors quite happy. Though the recession finally caught up to Walmart last quarter, when the company reported a 1.2% drop in U.S. same-store sales, Walmart was a consistent winner during the worst days of the financial crisis, as frugal consumers traded down.

While most retailers are shutting down stores, Walmart has opened 52 Supercenters since Feb. 1. Joseph Feldman, retail analyst at Telsey Advisory Group, estimates that each store costs Walmart between $25 and $30 million. In order to continue the momentum that it has picked up during the retail recession, over the next five years the company plans to remodel 70% of its approximately 3,600 U.S. stores.


So what does a Project Impact store look like? One recent weekday afternoon I toured a brand new, 210,000-sq.-ft. Walmart in West Deptford, N.J., with Lance De La Rosa, the company's Northeast general manager. "We've listened to our customers, and they want an easier shopping experience," says De La Rosa. "We've brightened up the stores and opened things up to make it more navigable."

One of the most noticeable changes is that Project Impact stores reshape Action Alley, the aisles where promotional items were pulled off the shelves and prominently displayed for shoppers. Those stacks both crowded the aisles and cut off sight lines. Now, the aisles are all clear, and you can see most sections of the store from any vantage point. For example, standing on the corner intersection of the auto-care and crafts areas, you can look straight ahead and see where shoes, pet care, groceries, the pharmacy and other areas are located. And the discount price tags are still at eye level, so the value message doesn't get lost. (See how Americans are spending now.)


"They are like roads," De La Rosa says proudly. "And look around, the customers are using them. We've already gotten feedback about the wider, more breathable aisles. Our shoppers love them."


The layout is also smarter. "You can kind of guess where everything is going to be," says Sharon Tilotta, 73, a shopper in the West Deptford store. The pharmacy, pet foods, cosmetics and health and beauty sections are now adjacent to the groceries. In the past, groceries and these other sections were often at opposite ends of the store, which made it more difficult for someone looking to pick up some quick consumables to get in and out of Walmart.

"Under Project Impact, Walmart is providing more of a full supermarket experience within its walls," says Feldman. "The biggest complaint against them has always been that it takes a long time to get through everything. This definitely improves efficiency." De La Rosa also points out the party-supply section. Favors, wedding decorations, cards and scrapbooks are all in one area. "In the past, these products would be in three different places," he says.


And although Walmart won't admit to targeting specific competitors - "We're just listening to what our customers want," De La Rosa says - it's clear that, under Project Impact, Walmart will make major plays in winnable categories. The pharmacy, for example, has been pulled into the middle of the store, and its $4-prescriptions program has generated healthy buzz.

With Circuit City out of business, the electronics section has been beefed up. Walmart is also expanding its presence in crafts. Sales at Michael's Stores, the country's largest specialty arts-and-crafts retailers, have sagged, and Walmart sees an opportunity. Stores are chock-full of scrapbooking material, baskets and yarns. "Look, they're selling the stuff that accounts for 80% of Michael's business, at 20% of the space," says Flickinger. "It's very hard for any company to compete with that." (Read "That Viral Thing: People of Walmart.")


Apparel, one of Target's traditional strengths, gets a prominent position at the center. The color palettes of the shirts and dresses are brighter and more appealing than they've been in the past. "Walmart has figured out fashion for the first time in 47 years," Flickinger says. "They've gone from a D to an A-minus." Briefs and underwear have been shuttled to the back. "That's a smart move," Flickinger says. "People know to come to Walmart for the commodity clothing. Now, they have to walk past the higher margin, more fashionable merchandise to get what they need."


Of course, Project Impact isn't perfect. You'd think that if Walmart was going to open a massive new store with a cutting-edge layout, the company would at least put a sign up. In West Deptford, it's easy to miss the entrance to the Walmart - which is buried in the back of a parking lot - while driving along a main thoroughfare.

And of course, customers will always nitpick. One elderly shopper complained about a shortage of benches in the store (she needed a rest). Another had a more esoteric, yet legitimate, gripe. "Their meat is leaky," says Jeff Winter, 30, a West Deptford shopper. "And instead of giving you a wet wipe to clean it off, they give you a dry towel. How's that going to prevent E. coli or whatever?" (See which businesses are bucking the recession.)


What analysts really want to see from Project Impact, however, is a faster pace of implementation. "The biggest hurdle facing Walmart is the speed with which they can roll this out," says Feldman. As more Project Impact stores pop up, the existing stores appear worse by comparison. For example, while the merchandise at the Project Impact store outside of Philadelphia really speaks to that particular market - there's tons of Eagles and Phillies gear - at one regular discount store outside New York City, Minnesota Twins and Seattle Mariners pajama pants wasted away on the racks. There were plenty of associates staffing the electronics section at the Project Impact store; at the discount store, five frustrated shoppers waited in line for help from a customer-service rep. Soon, it was closer to 10.


What about the friendly service? In West Deptford, the associates were sunny and bright. At the New York–area discount store, not so much. "You'll notice we've been in the store for two hours, and no one has even said hello to us," Flickinger says after he and I toured that store. He's right, we weren't feeling any love. But if Project Impact keeps picking up momentum, many more Walmart salespeople, and shareholders, should be smiling.


*****************

I've always really liked my Walmart. Toys R Us, I'm surprized there are any of those still open.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Wed Sep 09, 2009 9:43 pm

That was an intersting article. I've always liked Walmart, but I can't see myself going there for everything. There are no Walmarts in NYC. The closest one is a 30 minute drive away in White Plains, and it's a crappy Walmart, too. The ones upstate and in New Jersey are much better.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Wed Sep 09, 2009 9:46 pm

Well I've always had one opinion about them,they steamroller the competition.
Someday when there are only Walmarts you'll buy what they sell at the price they sell it at because there won't be any more competition.
I find that kind of sad.
Every store has it's place,but Walmart wants to take the place of every store there is.

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Wed Sep 09, 2009 9:52 pm

I hate Walmart personally. I've seen many a local company go under when they first came into town. Even now, I don't shop there because the quality isn't there. I'd rather pay the few dollars extra for a product I know will be there in a year.

And Toys R' Us I don't think will be going under. From what I've seen from the ones that shop around here, they're two different social groups. Those that shop at Walmart are just looking to get it cheap (and look rather cheap from my experiences here). Where as, the Toys R' Us group is those that actually shop at malls and free standing (non-department) stores.

If anything, Walmart has become so marred around here that they may be the one that goes under.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 12:30 am

Toys R Us is most likely going to stay up since they have a vastly wider selection of toys.

I hate Wal-Mart but I have very few options. For basic groceries, I can go to the Dollar General.

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 1:24 am

Project Impact is part of why I've been stressed and tired lately.

The Target I work in the photo lab of is across the street from an old WalMart. The WalMart is currently getting a fabulous makeover. Their photo lab was tripled in size and given all kinds of shiny new kiosks and printers that can make posters and mugs and all kinds of cool things.

But they can't develop film. Sure, film is an anachronism in some ways, but it is not technically feasible to make a 5 dollar, 27 shot disposable digital camera. The end of summer is when all the disposable cameras come home to roost.

My workload has grown 5-fold, but for economic reasons Target has been dramatically cutting hours. I am expected to handle returns, cashiering and film orders, all at once. I'm loosing my mind.

But hey, at least at the end of the day I can say i work for the less evil mega-corporation!
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 11:34 am

wow, am I the only one that lives in "competition" paradise? we have quite a few K Mart, target, walmart, toys R us, Baby's R us in this city and 4 malls, 3 if you don't want to could the one that keeps dying and coming back like a mall zombie... Thats on top of all the other stuff Shocked
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 11:37 am

^^Nope. I'm in one of those cities too. Though it's a larger city. we have 4 walmarts, but they're out of everyone's way. 4 Shopkos, a couple of targets, a super target, a few Khols, ...I think maybe a Kmart somewhere. 2 full malls and a bunch of strip ones too. But then I think it kinda' comes with the big cities..
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 12:57 pm

The only reasons I like wal-mart are that I like their clothes and they're cheap. Though, the latter kinda goes without saying. tongue

It's mostly the other Wal-Mart shoppers that get on my nerves, but I guess that's not Wal-Mart's fault. Screaming, uncontrollable children, anyone?
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 1:05 pm

^^The cheap part also goes for quality as well. I've bought stuff there only to have them rip the day I took them home.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 1:37 pm

Huh. Most of my clothes I get there have lasted a long time.
Their jeans ARE crappy, though. (albeit comfy.)
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 8:07 pm

I buy my clothes there when I have the money. I just want clothes that fit and a reasonable price. So it's there or Zellers (a Canadian walmart I guess)
I can't afford clothes at the mall. Especially now with my hours cut in half.

Very selfish of them to want and take over everything.
But they can't sell every single thing. You'll still have to go to a grocery store to get certain food. You'll still have to go to Toys R Us to get a certain toy that Walmart doesn't carry.
It would be impossible to carry every single product.
I still go to HMV cause Walmart doesn't have the Cd's I want.

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 10:08 pm

Zelda! wrote:
It's mostly the other Wal-Mart shoppers that get on my nerves, but I guess that's not Wal-Mart's fault. Screaming, uncontrollable children, anyone?

For a long time I was baffled by the lesser screaming children quotient in my Target. Then I realized: Target spent the extra money to install a drop ceiling with acoustic tiles. Walmart has open metal ceilings with exposed pipes and the like. This causes the screaming children to echo 5 aisles over, whereas in Target the sound only carries one aisle.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 11:29 pm

Emmature wrote:
Zelda! wrote:
It's mostly the other Wal-Mart shoppers that get on my nerves, but I guess that's not Wal-Mart's fault. Screaming, uncontrollable children, anyone?

For a long time I was baffled by the lesser screaming children quotient in my Target. Then I realized: Target spent the extra money to install a drop ceiling with acoustic tiles. Walmart has open metal ceilings with exposed pipes and the like. This causes the screaming children to echo 5 aisles over, whereas in Target the sound only carries one aisle.
my target just has pit falls, child starts screaming floor opens up, screaming child removed and put in a holding room to be picked up when the parent(s) leave Very Happy Very Happy
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 11:30 pm

there are always the oddest people at wal-mart. Like the other day I saw a pregnant lady with a half cut shirt on. Then I saw a man buying about 4 large cases of cat food (like 80 cans). I guess he is staking up for the winter.

I also see tons on moms yelling and spanking their children.

oh ya and one time I saw a man sprint out of walmart with 3 workers chasing after him.

I guess its b/c I go to school in a rural area in Missouri
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Thu Sep 10, 2009 11:44 pm

Wal-Mart is definitely the zoo of human oddities.

I thought this was apropos for this subject:


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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Fri Sep 11, 2009 4:39 pm

Lol, one time i went to walmart at 3 a.m. to get a plunger (long, horrible story) and there was a guy with long hair and a looong beard, buying two overflowing carts full of toilet paper. I figured it was his bienieal trek out of the bomb shelter.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Fri Sep 11, 2009 8:03 pm

Or he is planning on having a good Mexican dinner...at three in the morning.

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Sun Sep 13, 2009 4:04 pm

SPF wrote:
there are always the oddest people at wal-mart. Like the other day I saw a pregnant lady with a half cut shirt on. Then I saw a man buying about 4 large cases of cat food (like 80 cans). I guess he is staking up for the winter.

I also see tons on moms yelling and spanking their children.

oh ya and one time I saw a man sprint out of walmart with 3 workers chasing after him.

I guess its b/c I go to school in a rural area in Missouri


Nope, that's just Wal-Mart. I live in a pretty big city and that sounds about right. xD

But there are indeed differing levels of weirdness depending on location. The Wal-Mart in Pueblo, CO for instance... Eugh. *shudder* I went into the back restroom (because the front restroom was so heinously filthy) and there was some mother pulling toilet paper out of another stall for her kid on the toilet. She didn't even tear it off like normal person, she just pulled a looooooooooong strand of it to the stall were her kid was. WHILE cussing her kid out.
Wally-world is an interesting place.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Sun Sep 13, 2009 5:10 pm

Asda (as Wally-mart is known over here) is total complete and utter crap. I hate the ethics behind the company.... one thing in their favour though - they have a bloody cracking Halloween section woohoo

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Sun Sep 13, 2009 8:29 pm

ugh, I used to work for walmart. and I hate it. I go there alot though, just because it is easy access from the campus. But it is still crappy. I don't buy my clothes there, or electronics or cd's, because the selection sucks. I usually only go there for food or makeup, even then it's not often.
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Mon Sep 14, 2009 2:14 am

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Mon Sep 14, 2009 2:06 pm

... This could be enjoyable for days!

Only I was too afraid to go past the "Twister" at the time for fear I might have have been the unknow sponser to someone's $100 dollar gift card!

Man, Work it Nana. Whoever writes these up..that one right there was really, well had some thought put into it. Lovin' the the color in dress choice Nana! clap
No more late night.. I don't care..
bone curlers still in the hair for me any more.. no Sir Wally!


(Kiddin', they're hair accessories! skull Wink )
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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Mon Sep 14, 2009 11:15 pm

endless dark wrote:
http://peopleofwalmart.com

*phew* I'm not in there.

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PostSubject: Re: Walmart's Project Impact: A Move to Crush Competition   Tue Sep 15, 2009 3:59 pm

endless dark wrote:
http://peopleofwalmart.com

Oh my. This is going on Zelda's Facebook page.


Yet another industry Wal-mart put out of business: Freakshows.
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