Walmart Inc. · NASDAQ:WMT
Walmart — Investor Day (October 2014)
48 slides from Walmart's investor day presentation, Oct 14, 2014
Slide 1: 10/14/2014
10/14/2014
Slide 2: Greg Foran, President and CEO, Walmart U.S.
Greg Foran President and CEO Walmart U.S. 10/14/2014
Slide 3: Walmart U.S. leadership team
Walmart U.S. leadership team Operations Merchandising Development Logistics E-commerce Gisel Ruiz Duncan Mac Naughton Judith McKenna Chris Sultemeier Michael Bender Marketing Finance People Real Estate Stephen Quinn Jeff Davis Kristin Oliver Pam Kohn 3 10/14/2014
Slide 4: Today’s agenda
Today’s agenda First impressions Ready for the holidays Evolving Walmart as the customer evolves 4 10/14/2014
Slide 5: Today’s agenda
Today’s agenda First impressions Ready for the holidays Evolving Walmart as the customer evolves 5 10/14/2014
Slide 6: Walmart U.S. strategic plan timeline
Walmart U.S. strategic plan timeline Thorough diagnostic review (~100 days) Today Aug Sep Oct Nov Dec Jan Store visits Associate feedback Holiday Leadership discussions Strategic meeting initiatives defined 6 10/14/2014
Slide 7: Strong initiatives under way
Strong initiatives under way Productivity loop Operate Buy for for less less Grow Sell for sales less 7 10/14/2014
Slide 8: Strong initiatives under way
Strong initiatives under way Multi-format portfolio Productivity loop Operate Buy for for less less Supercenter Grow Sell for sales less 8 10/14/2014
Slide 9: Strong initiatives under way
Strong initiatives under way Multi-format portfolio Productivity loop Broad and local assortment Operate Buy for for less less Supercenter Grow Sell for sales less 9 10/14/2014
Slide 10: Strong initiatives under way
Strong initiatives under way Multi-format portfolio Productivity loop Broad and local assortment Operate Buy for for less less Supercenter Grow Sell for sales less Creating opportunity 10 10/14/2014
Slide 11: Strong initiatives under way
Strong initiatives under way Multi-format portfolio Productivity loop Broad and local assortment Operate Buy for for less less Supercenter Grow Sell for sales less Creating opportunity Innovative programs 11 10/14/2014
Slide 12: Strong initiatives under way
Strong initiatives under way Multi-format portfolio Productivity loop Broad and local assortment Operate Buy for for less less Supercenter Grow Sell for sales less Digital/physical integration Creating opportunity Innovative programs 12 10/14/2014
Slide 13: Challenging recent financial performance
Challenging recent financial performance FY15 1H financials Net sales up 2.3%, or $3.2B Sales Flat comp Gross profit Mix and price investment driving rate decline Operating Focused on improving store standards and service levels expenses Significant headwinds from health care and utilities
Slide 14: Primary focus: improving the core
Primary focus: improving the core Drive comp sales Actions are expected to Focus on quality benefit financials … o Markdowns and inventory damages o Inventory levels o Outlier stores o Merchandise returns 14 10/14/2014
Slide 15: Broad opportunities to improve
Broad opportunities to improve Service In-stock Price Fresh Inventory Digital / physical Improving the core is important to top and bottom line growth 15 10/14/2014
Slide 16: Today’s agenda
Today’s agenda First impressions Ready for the holidays Evolving Walmart as the customer evolves 16 10/14/2014
Slide 17: Omni
Omni 10/14/2014
Slide 18: Duncan Mac Naughton
Duncan Mac Naughton Executive Vice President, Chief Merchandising Officer Walmart U.S. 10/14/2014
Slide 19: Building customer trust through Savings Catcher
Building customer trust through Savings Catcher Highlights • National launch August 2014 • ~5M users signed up to-date • ~3% of receipts1 • Attracting new customers to dotcom and to our mobile app “This app … will prevent you from running from store to store for the lowest price.” - Walmart customer
Slide 20: Savings Catcher
Savings Catcher Walmart NYSE: WMT
Slide 21: Reinvigorating our focus on fresh
Reinvigorating our focus on fresh Highlights • Commitment to consistent quality • Focus on operational excellence • Associate accountability • More local assortment Providing more days of freshness to our customers 21 10/14/2014
Slide 22: Michigan Apples
Michigan Apples = ae NYSE: WMT
Slide 23: Re-envisioned the entertainment department
Re-envisioned the entertainment department A holiday destination Space re-allocation Brand focus New categories 23 10/14/2014
Slide 24: Inspiring holiday meals
Inspiring holiday meals Digital / physical integration “Taste of Entertaining” Follow the latest social media Experience tastes & tips from our baking trends while in-store holiday entertainment guide 24 10/14/2014
Slide 25: Exciting seasonal merchandise
Exciting seasonal merchandise Halloween Seasonal Gifts $28.88 $16.97 $6.98 $119 $10 $249 $998 25 10/14/2014
Slide 26: Holiday Hub
Holiday Hub Walmart Walmart >{< NYSE: WMT
Slide 27: Continuing programs important to our customer
Continuing programs important to our customer 27 10/14/2014
Slide 28: Chosen by Kids
Chosen by Kids 10/14/2014
Slide 29: Gisel Ruiz
Gisel Ruiz Executive Vice President, Chief Operating Officer Walmart U.S. 10/14/2014
Slide 30: Improving our business by listening to customers
Improving our business by listening to customers “The products I’m “Help when and where I “I want a painless looking for, on the need it. I don’t want to checkout. Fast shelves, every time I’m have to search for it.” and Easy.” in the store.” In stock Engaged associates Fast checkout 30 10/14/2014
Slide 31: Repurposed 20M hours to stock products
Repurposed 20M hours to stock products Highlights • Improved picking logic • Removed unnecessary item counts • Simplified getting merchandise on the shelf 31 10/14/2014
Slide 32: Improving service through engaged associates
Improving service through engaged associates 2014 marked the highest engagement scores in company history Adding 60K new associates this holiday season Introducing dress code and training to create a new associate brand Promoting associate ownership through recognition and new innovative tools 32 10
Slide 33: Investing to open up more registers than ever
Investing to open up more registers than ever Program Highlights • Direct response to customers’ #1 request • More registers open than ever before during the peak holiday shopping season 33 10/14/2014
Slide 34: Real opportunities. Everyday possibilities.
Real opportunities. Everyday possibilities. Opportunity: Employment • Hired 62K veterans since May 2013 • 15K – 50K job openings on any given day Opportunity: Choice • Offered more than 39M hours through the “Access to Open Shifts” program this year • 80K associates converted to full time Opportunit
Slide 35: Update on challenges mentioned last year
Update on challenges mentioned last year Highlights • Approximately half of the 500 discount stores have real estate actions that are planned or being evaluated • Bottom 10% stores improved their sales comp ~4% from Q2 FY14 to Q2 FY15 35 10/14/2014
Slide 36: Today’s agenda
Today’s agenda First impressions Ready for the holidays Evolving Walmart as the customer evolves 36 10/14/2014
Slide 37: Judith McKenna
Judith McKenna Executive Vice President, Chief Development Officer Walmart U.S. 10/14/2014
Slide 38: Evolving with the customer
Evolving with the customer Evolving customer Evolving Walmart Our customers are digitally connected Formats They value: − Convenience New concepts − Low prices − Broad assortment − Services Services 38 10/14/2014
Slide 39: Refining supercenters
Refining supercenters Supercenter • Large format offering food & general merchandise • Important format for the stock-up trip • Moderating supercenter growth in short-term as we evaluate evolving customer needs Redefining space Unit growth1 130 ~120 Focus on digital and services 60 - 70 Provid
Slide 40: Continuing Neighborhood Market expansion
Continuing Neighborhood Market expansion Neighborhood Markets • ~40K square feet offering fresh, fuel & pharmacy • Continued strong sales comps • Focused on quality of sites • Optimizing the format Unit growth1 180 - 200 ~170 Customer offer 105 Operating model FY14 FY15 FY16 Operational standa
Slide 41: Learning from small format grocery test
Learning from small format grocery test Walmart Express • ~12K square feet offering fresh, fuel & pharmacy • Rebranding to Neighborhood Market Unit growth ~70 7 ~20 FY14 FY15 FY16 • Test units in place by Q1 FY16 41 10/14/2014
Slide 42: We’ve aligned our field structure with our formats
We’ve aligned our field structure with our formats Large format field alignment Small format field alignment West East Northern Plains West East AK WA Northeast Great Lakes ME MT ND OR MN ID SD WI NY WY MI IA PA Pacific West NV NE IL IN OH Pacific-AK, CA, HI UT WV CA CO Central Plains KS VA MO KY NC
Slide 43: Continuing to test and learn
Continuing to test and learn Tethering Grocery Home Delivery Walmart Pickup - Grocery Walmart Care Clinics 43 10/14/2014
Slide 44: Providing service solutions for our customers
Providing service solutions for our customers Driving traffic and sales to stores 44 10/14/2014
Slide 45: Strong foundation of core strengths
Strong foundation of core strengths 45 10/14/2014
Slide 46: Strong foundation of core strengths
Strong foundation of core strengths Unique competitive strengths Delivering value for customers, shareholders, and associates FY14 net sales of $279B FY14 operating income of $22B History of Rich & cohesive Collaborative supplier innovation culture relationships ~600 million eComm visitors / quarter
Slide 47: Key takeaways
Key takeaways Conducting a thorough diagnostic review of the business Recognize broad opportunities to improve across the business Focused on building trust and driving sales every day, especially during the holidays Adapting to evolving customer needs and a shifting retail environment Well-position
Slide 48: Q&A
Q A 10/14/2014