LAS VEGAS — Independent supermarkets have a big opportunity as Wal-Mart expands its mission to reach new types of customers, according to presenters at the National Grocers Association annual conference here last week.
“They're trying to reinvent themselves,” Steve Dillard, vice president, corporate sales and business development at Kansas City, Kan.-based Associated Wholesale Grocers, said of Wal-Mart. “But independent retailers can beat Wal-Mart at things they're not as strong in.”
The reinvention results from Bentonville, Ark.-based Wal-Mart Stores' need to attract higher-income customers to ensure ongoing growth, he said, noting that Wal-Mart is underdeveloped with households earning $70,000 or more.
That has led Wal-Mart to unveil a number of recent initiatives, Dillard said, including:
Launches of more upscale Neighborhood Market units in select locations. These have enhanced signage and in-store meat cutting through leasing of meat areas to local butcher shops.
Upgrades of supercenters to draw more higher-income customers. These now have a cleaner, streamlined look with less clutter.
Reformulations of the Great Value brand to improve quality.
Dillard urged independents to improve their competitiveness pursuing special-event merchandising, employing non-traditional sales events and differentiating with fresh departments.
Glenn Richey, assistant professor of marketing and supply chain, University of Alabama, said Wal-Mart's reinvention could threaten ties to its existing customer base.
“I think they're losing their way with a group of core customers,” he said. “They are disenfranchising a lot of customers.”