Wal-Mart Stores Inc. became the world's biggest retailer
through its strategy of opening large superstores that offer a wide range of
affordable products. Now, the Betonville, Ark.-based company looks like it
wants to maintain its No. 1 retail title by changing course and opening
smaller stores, possibly through acquisitions in the U.S, according to the
Financial Times. A deal would mark the first time Wal-Mart would be making an
acquisition in the U.S.
The reported hunger for domestic deals by Wal-Mart is possibly
in response to Tesco plc, the world's No. 3 food retailer, opening of its
"Fresh & Easy" grocery stores in the U.S. Wal-Mart's limited success with
its experiment of opening smaller stores in the U.S. is another reason why it
is pursuing this new retail strategy. It opened the first of these smaller
market stores, called the Neighborhood Market chain, with less than 50,000
square feet in Tulsa, Okla., on January 2007.
Wal-Mart has also met resistance from neighborhoods around the
U.S. claiming that their "big box" stores reduce or even stifle competition
and local economic growth.
Even Home Depot Inc., a home improvement store known for its mammoth
locations, has tried the smaller concept stores —
in New Jersey — without much success.
But it is still trying to find the right
approach for this retail formula. — Gerald
Magpily
See
Dow Jones via CNNMoney.com
See
FT.com (subscription required)
Tags:
deals,
m&a,
Wal-Mart,
Tesco
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