Walmart’s stock took a tumble, but the news may not be bad for suppliers.
The L.A. Times said that, “Walmart’s price action provides a fascinating glimpse in action of Wall Street’s fixation on short-term results.” When Walmart announced that it would be investing in long-term growth and improvements, stock prices fell by 10%.
But Walmart’s investments are smart choices. They’re investing heavily in their associates, raising base wages to $10 an hour next year and increasing associate training. After years of complaints about store-level execution from customers and suppliers alike, this seems like an obvious necessary move.
They’re also investing in ecommerce. Walmart recognizes the strength of Amazon as a competitor, and knows that the “always on” shopper is the new retail reality. Last year, according to Google, 78% of holiday shoppers did online research before hitting physical stores and 40% did holiday shopping online. Walmart has been working hard to get their trailing ecommerce presence moving forward, and is already seeing results.
Analysts are saying that Walmart stock is a bargain right now and investors are snapping it up, but Walmart suppliers can benefit even more from smart moves than stock market mavens can.
Suppliers should take advantage of the increasing focus on ecommerce and get products on the virtual shelves. This is also a good time to consider investing in third party services that improve store-level execution. Going along with Walmart on these initiatives now will build your Walmart business for the future.
Contact 8th & Walton for custom support right now to see how your company can best leverage Walmart’s improvements.