Walmart's Project Impact: A Move to Crush Competition
Walmart came up with a new stradegy to bankrupt competition by being the world's largest retailer and their stradegy is called Project Impact. One of the goals are to have the stores less cluttery and more clean for customer's comfort while shopping, second goal is to have the customer service team more friendlier and thier third goal is to have home in categories where the competition would be stomped. Retail consultant, Burt Flickinger III, managing director for Stategic Resources Group says "They've got Kmart ready to take a standing eight-count next year,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."
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.
Investors are happy with the new CEO Mike Duke because of the way Walmart stay a consistant winner throughout the recession.
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.
Lance De La Rosa, Walmart's Northeast general manager, has defined Project Impact as an "easier shopping experience for customers, 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