In a significant expansion move, Walmart declared its intention to open 150 new stores across the United States over the next five years, signaling a major growth initiative for the retail giant. The announcement, made in a statement on Wednesday, outlined the company’s plan to invest millions of dollars in this ambitious endeavor.
Currently employing approximately 1.6 million people in the U.S., Walmart emphasized its commitment to hiring hundreds of new employees with the opening of each store. As of October, the retail giant operated just over 4,600 stores nationwide, a slight decrease from the previous year’s figure of over 4,700. Notably, Walmart has not introduced a new U.S. store since late 2021.
The upcoming stores will primarily consist of newly constructed locations, with some involving the conversion of existing sites into new formats. The initial two stores are set to open in the spring, located in Florida and Georgia, while plans for the construction of an additional 12 stores are already in progress for this year. Walmart also announced intentions to remodel 650 existing locations.
This week, Walmart unveiled plans to raise salaries and benefits for store managers, coupled with stock grants as an incentive. The retail giant reported a significant increase in profit during the first three quarters of 2023, and its stock price is currently near a record high. Earnings for the latest quarter, inclusive of the holiday season, are yet to be reported.
Despite challenges posed by high inflation and rising interest rates, consumer spending in the U.S. has remained resilient. Credit card data from the holiday season indicated a year-over-year increase in retail sales, reflecting robust consumer activity.
Walmart’s decision to expand its store footprint aligns with its strategic focus on enhancing in-store and pickup experiences, even in the face of growing e-commerce trends. The company’s emphasis on physical retail locations reflects a belief in the enduring appeal of traditional brick-and-mortar stores, noted Edward Yruma, an analyst at Piper Sandler. Walmart’s move has been interpreted as a “huge vote of confidence in the American consumer” by Craig Johnson, founder of retail consultancy Customer Growth Partners.
While Walmart’s expansion plans received positive attention, some investors expressed concerns about potential implications for Walmart’s Sam’s Club stores. The shift from a business-centric supply destination to a grocery-focused retail space for individual consumers has prompted scrutiny. However, Walmart remains steadfast in its commitment to enhancing both in-store and online shopping experiences, adapting to the evolving retail landscape.