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The Wall Street Journal reports that Walmart “is exploring opening a number of small outposts to penetrate the nation's cities and fight the spread of no-frills grocery chains, which are luring away some of its core customers.,” and that CEO Mike Duke says in the company’s annual report that Walmart’s growth will be fueled by “innovative new formats.”

The paper notes that Walmart has tried a variety of small formats in the past, including its Neighborhood Market and Marketside chains. But Neighborhood Market has always been plagued by questions about ROI (especially compared to the Supercenter format), and Marketside’s early returns and reviews were disappointing enough to keep it to just four stores at this point. But Walmart cannot afford to be complacent, since the growth of limited assortment, sharp-discount chains such as Aldi and Save-A-Lot creates new pressures on the world’s biggest retailer.
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