Wal-Mart Stores Inc. (NYSE:WMT) & Best Buy Co. Inc. (NYSE:BBY) Bet on Strategic Initiatives
Wal-Mart Stores Inc. (NYSE:WMT), which operates more than 4,000 stores in the U.S., recently announced to further the growth of its small stores by chaining them to its super centers that will more likely serve as mini warehouses for their smaller counterparts. The company reported that it will be rolling out the new distribution strategy in some select markets including Gentry, Ark., where is already operating Wal-Mart Express store. The Wal-Mart Express stores are typically just one tenth the size of its customary supercenter stores.
The Wal-Mart is considering this strategic alternative as it faces increasing competition and pressure from online retail giants likeBest Buy Co., Inc.(NYSE:BBY), Amazon.com, Inc.(NASDAQ:AMZN) as well as the dollar stores which are quickly building stores and winning customers through lucrative offers including convenience, low prices and seasonal best-in-market discounts. The strife competitive play between Wal-Mart and Best Buy Co. was recently evident when they started slashing the prices of Apple Inc.(NASDAQ:AAPL)’s latest introductions iPhone 5C and iPhone 5S in response to each other’s discounted listing prices.
Best Buy Co. offers latest technological devices under one roof and that includes consumer electronics, computing and mobile phone devices, entertainment products, appliances and related services through its physical and online retail operations and assisted call centers. As Best Buy knows it’s lagging position amidst its peers, it launched a strategy with major initiatives during last November to further strengthen the supply chain efficiency, online growth and store space optimization to drive down cost of goods, increase revenues and gross profit.
On the other hand the Wal-Mart President and Chief Executive Officer, Mike Dukerecently commented in his opening remarks during the company’s 20th Annual Meeting for the Investment Community that the company is executing substantial or even game changing progress in key domains and includes leverage initiatives, e-commerce, compliance, corporate responsibility and talent recruitment.