Paying attention to WMT store size experiments

WHAT IT MEANS AND WHY IT'S IMPORTANT — Walmart opened its first Express stores earlier this month to mixed reviews about the impact of the new format on the company domestic growth. At 15,000 sq. ft., Walmart opened the first Express location in Gentry, Ark., last week, but offered media and investment analysts a preview of the store prior to the company’s shareholders meeting on June 3.

(THE NEWS: Walmart Express makes debut. For the full story, click here.)

The store is a no-frills affair with bare concrete floors and an open rafter ceiling, and the merchandise mix is heavily oriented toward food, along with an emphasis on Walmart’s Site-to-Store service where it ships merchandise ordered online to stores for free. The jury is out on the format’s potential impact on pharmacy; the location in Gentry, which is about a 30-minute drive southwest of Walmart’s headquarters in Bentonville, contains a pharmacy, but another test location further south in the community of Prairie Grove does not. Both communities are quite small with only a few thousand residents and pharmacy competition limited to independents.

Judging from the location of the first Walmart Express stores, the competitors likely to feel the greatest impact are Dollar General and the 21-unit regional grocery chain Marvin’s food stores. Both have locations near the Walmart Express stores and surely will experience a loss of shopper traffic and sales as residents of Gentry and Prairie Grove check out Walmart’s newest concept.