What is Walmart's Competitive Advantage
Walmart's digitization strategy is convincing
While home deliveries are the main focus of attention, for us the future of retail lies in omnichannel offerings, with consumers expecting a variety of fulfillment options such as home delivery, click-and-collect, and traditional shopping Branch. Consumers will make different choices depending on their preferences, the immediacy of the need, and the nature of the item.
Thanks to its economies of scale in purchasing and sales, its branch network and its investments in digital, Walmart should be able to protect its cash flows. The switch to free delivery the following day and the expansion of grocery collection and delivery on the same day at 2,450 and 1,000 US branches should benefit him.
Domestic performance drove results, with Walmart stores in the US posting robust comparable sales growth of 3.4% and Sam’s Club showing a similar level of 3.0% excluding gasoline and tobacco. With the support of e-commerce, both chains are likely to achieve low single-digit sales growth rates over the long term. Still, the margin benefits from optimizing costs are likely to be limited due to the need to keep prices down and invest in more expensive fulfillment options.
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