Walmart to Combine Online and Store Product-Buying Teams -- 2nd Update
February 25 2020 - 1:39PM
Dow Jones News
By Sarah Nassauer
Walmart Inc. is combining its U.S. online and store
product-buying teams as the country's largest retailer seeks to
reduce conflict between the units and increase profits at its
e-commerce business, whose global sales will approach $50 billion
this year.
Previously, product manufacturers selling their wares both on
Walmart.com and in Walmart's stores had to pitch two separate
buying teams. The teams sometimes clashed over pricing differences
between products on- and offline, as well as over plans to use
stores to facilitate online sales for home delivery, according to
people familiar with the situation.
Walmart has long operated with different e-commerce and store
teams, with the latter generally based in Arkansas and the former
in California or New Jersey. It has been slowly integrating the two
as the business blends; last year the retailer combined its online
and store supply chains and finance teams.
Still, the company has maintained separate chief executives for
the U.S. online and store businesses, Marc Lore and John Furner,
and the two will stay in those roles under the new structure.
The company is creating six category teams, such as food,
consumables, apparel and entertainment. Each team will be led by an
executive and eventually buy every item sold by Walmart in the
U.S., according to an internal memo Tuesday morning. The consumable
and food groups will begin joint buying immediately, the memo said,
while the other buying categories will come together over time.
A Walmart spokesman said the new structure is aimed at making
prices and the shopper experience more consistent, regardless of
where transactions take place.
The company has named Chandra Holt its chief merchandising and
integration officer for Walmart e-commerce. Previously, Ms. Holt
led merchandising for e-commerce at Sam's Club, Walmart's warehouse
chain. She will continue to run the online business "while
simultaneously working through the process of integrating the teams
as each is ready," the memo said.
Ms. Holt and the leaders of the six product category teams will
report to Scott McCall, who was named chief merchandising officer
earlier this year. Mr. McCall will report jointly to the CEOs of
Walmart's U.S. store and e-commerce businesses, a spokesman for the
company said.
Integration of online and offline buying teams at Walmart could
become a significant part of the company's strategy to build on the
success of its online grocery business to fend off Amazon.com Inc.
Most of Walmart's roughly 4,700 U.S. locations now offer a service
that lets shoppers buy online and pickup orders in store parking
lots, and around 1,600 stores offer online grocery delivery.
Walmart wants to expand those online services to include more
profitable nongrocery items, executives said in an investor day
presentation last week. That could make the services more
profitable and give Walmart an additional way to compete with
Amazon's ability to deliver many nongrocery items quickly to
shoppers' doorsteps.
At the same time, Walmart aims to add to its assortment online,
executives said last week. Under the new structure, merchandisers
will be empowered to control the additional selection on- and
offline.
Write to Sarah Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
February 25, 2020 13:24 ET (18:24 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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