Walmart: ‘Our Strength Is Driven By Food’

Grocery Dive – Once again, the largest growth number at Walmart was its e-commerce sales, with grocery serving as the major sales driver.

The retail giant now offers pickup from roughly 3,100 locations and same-day grocery delivery from more than 1,400 stores.

Services like in-home delivery and an “unlimited” delivery subscription have rolled out in recent months, with the aim of deepening customer loyalty as Amazon ramps up its grocery services, including a new grocery chain due next year and free Fresh service for Prime members.

Within grocery, product innovation and price investments are driving customer interest.

The retailer noted snacks, beverages and fresh foods were top performers in Q3, while private label “increased penetration” and “continues to drive strong sales along with our expanding omnichannel offering.”

Comp sales in grocery increased in the mid single digits, the company noted.

“Our strength is being driven by food,” CEO Doug McMillon said in prepared comments.

However, while food has boosted online growth, McMillon added that Walmart needs to improve its general merchandise performance.​

“We’re making progress on many fronts, but we need to do more and move faster, especially with our assortment including marketplace,” he said. “I continue to challenge the team to drive a deeper, more sustainable relationship with the customer, better execute the fundamentals, and improve the overall economics of the business.”

Charlie O’Shea of Moody’s noted Walmart’s e-commerce growth as well as a slight operating margin improvement in a “hotly-promotional environment,” saying that the performance “speaks to the quality of Walmart’s operating discipline, which will come in handy during what is shaping up to be yet another acutely-promotional holiday season.” Read more. 

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