Sales growth shows Walmart’s plan working

NEW YORK — Walmart may be bruised by Amazon, but it’s learning how to fight back.

The world’s largest retailer delivered strong thirdquarter results Thursday, extending a streak of sales growth into its 11th straight quarter that was helped by services such as online grocery pickup. It also raised profit expectations for the year heading into the holiday shopping season.

Walmart posted strong sales across a wide range of products from toys and backto-school items to fresh food. That helped sales at stores open at least a year rise 3.4 percent, a bit slower from the previous quarter’s 4.5 percent at Walmart’s U.S. division, which marked its best performance in more than a decade. The measure, an indicator of a retailer’s health, was helped by a 1.2 percent increase in customer traffic and a 2.2 percent increase in transactions.

Since buying Jet.com two years ago, Walmart has been expanding online by acquiring brands and adding thousands of items. It’s also been ramping up grocery delivery and pickup options. Grocery pickup is offered at nearly 2,100 of its 4,700 U.S. stores, while grocery delivery is available in nearly 600 locations. Walmart has also revamped its website with a focus on fashion and home furnishings. That all helped to drive a 43 percent increase in online sales in the U.S. during the latest quarter. That was up from a 40 percent increase in the second quarter and a 33 percent increase in the first quarter.

Still, Walmart’s online sales remain a fraction of Amazon’s online global merchandise empire, which hit $108 billion last year. Walmart’s U.S. online business was a mere Under U.S. CEO Greg Foran, Walmart is creating a tech-driven shopping experience while transforming its stores into efficient distribution hubs.

$11.5 billion.

A visit to a Walmart store in Houston last week showed generous holiday merchandise offerings such as expanded toy aisles with large interactive toy ponies and Barbie dream campers, each selling for nearly $400. Shoes are now unboxed and hang on racks to make it easier for shoppers to find them.

“We’re feeling confident going into this holiday season,” said Walmart U.S. CEO Greg Foran during an exclusive interview and tour last week at the Houston store. “I think the standards, the flow of merchandise, our pricing are feeling better than it was a year ago.”

Walmart is promising more to come. Under Foran, Walmart is creating a techpowered shopping experience while transforming its stores into efficient distribution hubs that can fill online orders to reduce shipping costs and speed up deliveries. To do that, Walmart is doing more extensive training for workers who are taking on new roles or redefined responsibilities while using scanning robots and other automation.

Walmart is deploying giant pickup towers that spit out online orders in hundreds

of its stores. Customers can now also better find items in the store because of digital maps on their smartphone. Workers, armed with new apps on their mobile devices, are also able to manage routine tasks, freeing them to serve the customer or check them out in key areas of the store.

“We can provide a much better customer experience because we are in stock of the right item, at the right time and at the same time it is going to help us be much more precise,” he added.

Foran said that Walmart is reviewing its policy that has a $35 threshold for free shipping for the holidays after Target and Amazon both got rid of the minimum orders for free holiday shipping.

Amazon is also expanding its cashier-less physical stores, pushing Walmart and others to speed up checkout, a source of frustration for many shoppers. In time for the holidays, Walmart has rolled out a program that allows its staff to check out customers and provide receipts right on the spot in the busiest sections of the store. Foran said the retailer is taking another look at offering Scan & Go, which has been shelved twice after customers found it too clunky.