Walmart to Open 219 Locations in 2013, Slow Capital Spending Growth
October 12, 2012,
BENTONVILLE, Ark.-Walmart said it would open about 219 U.S. locations, including Walmart stores, Sam's Clubs and its new smaller-format Neighborhood Markets in fiscal year 2013, the company told attendees at its annual conference for the investment community earlier this week.
At the same time, the retailer said its planned capital expenditures for the next fiscal year would be flat to slightly down from fiscal 2012, totaling in the range of $12.6 billion to $13.5 billion. Looking further beyond, Walmart's projection calls for a further deceleration in capital spending in 2014, to between $12 billion and $13 billion.
Charles Holley, executive vice president and chief financial officer, told the conference attendees that Walmart is essentially trying to do more with less. "We are improving our real-estate process and adding relatively the same square footage with fewer dollars," Holley said.
Looking further into the numbers, Walmart U.S. plans to add about 125 large-format stores next year, about 80 Neighborhood Markets and 14 Sam's Clubs. In fiscal 2014, it is projecting an additional 125 large-format stores, from 95 to 115 new Neighborhood Markets and from 12 to 20 new Sam's Clubs, for a total of from 232 to 260 new locations in that year.
Bill Simon, president and CEO of Walmart U.S., said, "We intend to achieve lower costs in real estate and construction, while delivering slightly greater square footage growth next year compared to this year. Our goal is to reduce the average cost of supercenters by approximately 10 percent by fiscal year 2016."
The company said it also plans to invest more heavily in the four markets that represent the greatest growth potential for e-commerce: the United States, the United Kingdom, Brazil and China. These investments will go toward developing a global technology platform and customer applications for mobile and social media. Earlier this year, Walmart had announced its intention to up its stake in Yihaodian, the e-commerce website based in China, to 51 percent.
Neil Ashe, president and CEO of Walmart Global e-Commerce, said, "We will continue to innovate in ways that will allow us to expand our global platform and strengthen our infrastructure and local fulfillment networks, while taking advantage of transformational mobile capabilities."