retail news in context, analysis with attitude

Bloomberg reports that Walmart "will start closing some of its 24-hour supercenters for at least a few hours each night, aiming to use the time to better stock shelves and organize stores for the peak shopping rush."

The move is said to affect about 40 stores, in addition to about 24 other supercenters that began reducing hours earlier this year.

According to the story, "The change is a sign of retreat for a company that helped bring convenience and all-hours shopping to many parts of America. Chief Executive Officer Doug McMillon is taking the step as part of his drive to improve the shopping experience at Wal-Mart’s U.S. stores, where customers have complained about empty shelves, long checkout lines and poor-quality produce."

Bloomberg goes on to write that "Brian Yarbrough, an analyst with Edward D. Jones & Co., said he’s skeptical the overnight closures will significantly improve workers’ ability to stock and prep the stores. Rather, he thinks it may be a trial run to see if Wal-Mart can reduce overhead by cutting store hours without losing sales. Since few other retailers are also open 24 hours, customers may just shift their shopping to when the store is open rather than take their business elsewhere."
KC's View:
That analysis strikes me as right-on ... Walmart certainly seems to be in a cost-cutting and efficiency mode, made more important because it is doing things like raising wages and investing a gazillion dollars in e-commerce initiatives. And, at the same time, it wants to be more effective about in-stock positions ... though I agree with Yarbrough that this move doesn't seem likely to effectively address this issue.