Walmart doubles down on grocery as traditional rivals sputter

Walmart is doubling down on its grocery business as more consumers turn to the company for their food needs.

The largest retailer in the country In the previous quarter, US same-store sales were reported to have increased 5.3% as it continued to gain market share in the grocery and general merchandise categories.

According to Walmart CFO John, the reason the company is growing in the grocery segment, which has become more expensive than inflation, is because the company is restructuring the produce sections of its stores and increasing the variety of food it offers.

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“That’s it [ the produce section] very attractive. We have a very high-quality product for people, and that draws them in,” Rainey said. “It’s a much wider variety than what we’ve had historically.

The company is building new upgraded stores and renovating hundreds of other stores. It has renovated an average of 700 stores each year, and plans to convert more in the coming year. The company’s new and upgraded stores include improved layouts, larger merchandise selection, updated signage, paint and shopping carts.

In addition to its improved aesthetics, Rainey also credited its private label as another driver the company launched its latest and broadest private label, Bettergoods, which includes 300 products including frozen, dairy, snacks, beverages, pasta, soups, coffee and chocolate.

The Walmart location at 2844 North Broadway Street before closing for good in Chicago, Illinois, USA, Wednesday, April 12, 2023. (Christopher Dilts/Bloomberg via Getty Images/Getty Images)

Rainey said not only does the company offer a wider variety of food under private label, but the quality of the food has also improved.

“It’s much broader and attracts a lot more customers and members,” Rainey said, adding that “the quality is just a lot different than what you’ve seen historically.”

He also emphasized that consumers’ growing reliance on convenience benefits Walmart, with one-third of their customers paying extra for fast food delivery through Walmart’s delivery services, according to Rainey.

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This comes as a result of a $25 billion merger Albertsons and Kroger is collapsing amid concerns from federal regulators that the deal would undermine competition in the grocery industry.The deal would have been the largest merger in the history of the grocery industry.

Walmart’s upgraded grocery department. (Walmart)

But U.S. District Judge Adrienne Nelson said a plan proposed by the two companies to cut grocery prices and divest more than 500 stores failed to address the concerns.educated competition industry and the impact it may have on consumers and workers.

Albertsons, which later sued Kroger for not doing enough to secure the merger, argued the deal would have increased competition, lowered prices, raised associate wages, protected union jobs and improved the customer shopping experience.

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As of September, Albertsons Companies operated 2,267 food and drug retail stores with 1,726 pharmacies, 405 affiliated fuel centers, 22 specialty distribution centers and 19 manufacturing facilities.

Kroger, meanwhile, operates 2,750 grocery retail stores under various banner names, including Kroger, Ralphs, Dillons, Smith’s, King Soopers and Fred Meyer.

Walmart operates more than 4,600 stores in the U.S. This does not include its membership warehouse, Sam’s Club, which has nearly 600 locations nationwide.