Part of the attraction of superstores like Walmart, and why such brick-and-mortar stores continue to enjoy success in the age of online shopping, is the fact they provide a complete, varied retail experience.
For years, this has included in-store fast food outlets like McDonald’s, Taco Bell and all the usual suspects. Expect to see a few new names too as Walmart refreshes its food offerings.
Staying Relevant in the Modern Age
A narrative that has affected many traditional retailers has been the change in consumer habits to favor online marketplaces and ditch traditional physical retailers.
It’s a shift that has seen many prominent retailers from a range of industrial segments struggle and eventually succumb to bankruptcy. One old-school store that seems to have effectively weathered the storm is Walmart.
Not Just Surviving But Thriving
Far from just hanging on amidst a shifting consumer landscape, Walmart is enjoying healthy financial growth while many of its competitors flounder.
In Walmart’s Q1 earnings call, Chief Executive Doug McMillon reported: “Our results were stronger than we anticipated, with sales growth of 5.7% and adjusted operating profit up 12.9% in constant currency. All three operating segments performed well.”
The Secret to This Success
So what’s behind Walmart’s strong financial position? In a nutshell, they’ve recognized that American consumers are more price-savvy than they have been in recent times.
Feeling the squeeze of inflation and the cost of living crisis, American shoppers are willing to drive to a Walmart, even if it’s a bit further afield than other stores if it means they’re shopping somewhere with better pricing power.
Price-Focused
The key to Walmart retaining its competitive edge is probably its price-rollback program, something that’s been part of the company’s pricing strategy for decades.
Walmart’s overall aim is to try and bring down its food costs to pre-inflation surge levels. In its efforts to look at cost-effectively revamping the Walmart shopping experience, the company is also re-examining its in-store restaurant offerings.
Traditional Food Offerings
For many years, Walmart stores have featured in-store fast-food offerings for shoppers to enjoy. In the past, this has included retailers like McDonald’s and Taco Bell.
In an effort to attract new customers, Walmart is refreshing its food options and ditching old partners like McDonald’s in favor of new, perhaps lesser-known fast-food outlets.
New Look to Walmart’s Food Halls
Walmart recently announced that it would be partnering with Knuckies Hoagies, a name that might be unfamiliar to many.
The chain out of Milton, Georgia, specializes in fresh specialty sandwiches and cheesesteaks. The agreement with Walmart also includes the option to open an Alumni Cookie Dough spot within each location as well.
Knuckie’s Story
Kuuckie’s is a relatively new player in the fast-food market, but it’s enjoyed a somewhat meteoric rise.
Founded in 2019, it featured on QSR’s 2023 40/40 list, meaning it was one of the most popular restaurants in the country with under 40 locations. It currently has 14 outlets in Walmart stores across six states, including Georgia, South Carolina and Texas.
Walmart’s Food Overhaul
Knuckies Hoagies isn’t the only new name popping up in Walmart food halls, displacing the old guard of fast-food outlets.
Walmart has opened up other food shops across hundreds of stores. Earlier this year, it started a partnership with Texas-based Mr. Gatti’s Pizza, opening restaurants in more than 90 Walmart locations.
Just One Aspect of a Walmart Overhaul
In-store food offerings are just one area where Walmart is looking to revamp the shopping experience for its customers.
The outlet aims to make the Walmart experience a more pleasant one for every customer who visits a Walmart store as it looks to generally revitalize the brand to retain the positive momentum it’s been enjoying.
Other Changes on the Way
Walmart has pledged to invest at least $9 billion to refresh stores, making them cleaner and easier to navigate.
The multi-year overhaul will affect at least 1,400 stores and include changes like updating interiors and exteriors, repainting and installing new signage, introducing digital product displays and expanding and centralizing in-store pharmacies.
Walmart Staying Ahead of the Curve?
Walmart has managed to buck the trend being experienced by many traditional physical retailers and enjoy growth and financial success. However, the company is not resting on its laurels.
The proposed Walmart changes, including an overhaul of its in-store food partners, speak to the company being led by its customers and trying to adapt to meet their needs. If they continue with this management ethos, they’ll probably continue to enjoy success.
