Weekend Links: Wal-Mart and Target to Create Smaller Stores

Posted by: Nick Leiber on February 5, 2010

Wal-Mart and Target told analysts they are creating smaller stores that could fit in the heart of densely packed cities where they have no presence, Nicole Maestri reports on Reuters.

It’s a $22 billion industry in the U.S. that’s becoming increasingly sophisticated. Bill Saporito, writing in Time, profiles one of the car-recycling pioneers in Detroit.

On NPR’s Planet Money blog, Chana Joffe-Walt offers a day in the life of a Haitian textile boss.

A better way to get a better page rank. Steve Strauss explains the virtues of search engine optimized video in a column he wrote for AmEx’s OPEN Forum.

You can’t read this one, but you can watch it. Mary Mazzio’s documentary about inner city students involved in NFTE’s business plan competition airs on SuperBowl Sunday on BET.

Reader Comments

Vikas

February 5, 2010 8:35 PM

Walmart has always been point of focus and pioneer in Retail world who fulfills common man needs.

Walmart once being "poor's man market" has turned out be "poor world market" who giving an opportunity for every buyer.

Smaller stores will be equally successful

Domenick Celentano

February 6, 2010 8:08 AM

Business Week
The Trend to Small

The general media such as Reuters will point to trends without seeing all of the underlying reasons for the trends. The trends to small is complex and has been developing over the past 3 years so for professionals such as myself who practice in the Retail Marketing arena, no revelations. Trader Joes has perfected small for many years and Fresh and Easy has been on the West Coast with the small format close to 4 years. The smart decision for both is they created a new banner for their Small Concepts… WalMart may need to get away from trying to all things to all people and create a more credible effort through a new banner for Small.

Small is driven my numerous reasons, complex enough that my response would emulate a posting vs. response so just some bullet points:

• Real Estate; it is getting more difficult to get the space and/or zoning approval for a big box
• Urban Markets; they know the retail banner, segments in the urban market would shop the retailer however few urban markets have the space for plus 150,000 sq ft stores
• Changing Shopper behavior; the trend toward Affordability has caused the average shopper to frequent 5 to 6 stores to fill their shopping list. So small stores make that more convenient.
• Customer Segmentation; Retailers are taking advantage of the vast data from loyalty card programs and the array of segmentation data available from providers such as Nielsen and IRI. Appealing to narrower segments is better done through smaller stores.
• Local; this Sustainability trend lends itself to the "Small" Strategy

For smaller businesses this Small Trend represents Opportunities as well s Threats. The large "guys" looking at small…. They have capital and supply chain experience for greater probability of achieving success. The Opportunity… "Small" allows small business the ability to get shelf presence in these more targeted, segmented retail formats.

Domenick Celentano
College of Business & Public Administration
Retail Marketing
Kean University
http://kean.domenickcelentano.com/
www.domenickcelentano.com
http://managementofsmallbusiness.blogspot.com/

Aaron Johnson

February 6, 2010 10:58 AM

Since Walmart and Target only sell crap marketed to poor people in the US made by the People's Republic of China. We the American people for the sake of economic national security should boycott Communist junk stores such as these. It is a sad state of affairs when the US retail sector consists of nothing but the trading of plastic rubbish from the Politburo.

Makes you wonder if there were highly classified back room deals where the US gets to start useless wars in Asia with China looking the other way while China sells us useless junk declaring economic war on the US middle and lower classes.

Washington fails to grasp the concept that a such a huge trade imbalance coupled with the staggering loss of jobs to Asia will result in a massive change in Washington come November. The political irony is that the conservative rubes coming in will be worse than the feckless Democrats in power now.

PTS999

February 7, 2010 11:37 AM

Big or small stores, I never shop at a Walmart. They make slaves of their employees, pay them minimum wages and don't provide them any health coverage. They make salves of their suppliers, forcing them to cut costs, move jobs overseas, and get them to employ minimum wage child labor camps. If Walmart employees atttempt to stand up and start a union, they buy-off the local legislators (politicians and judges) to stampout the employee initiatives. They hire lobbyists in Washington to pay off the politicans that legislate laws in their favor. They payoff the local media to speak in their favor. All the while, the Walmart family sits on $120B of personal wealth. So, in my opinion, it is an abusive corporation that doesn't give anything back to society (that it feeds on)and has sole interest in filling the pockets of its owners. Walmart and all such institutions in North America will only change their ways if they are collectively boycotted. Hurt them in their pocketbook because money is their only mantra.

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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