Following the elimination of 7,000 jobs in September, Wal-Mart Stores Inc. is reportedly mulling more layoffs before the end of the month.
Many of the job cuts are said to be at the retailer’s corporate offices. Human resources is just one of the areas being targeted, according to sources. Most of the positions are above the store level. Wal-Mart has been touting its $2.7 billion investment over two years in higher wages, education and training. The retail giant has been under pressure to raise wages and improve the schedules of its 1.5 million U.S. associates.
“We’re always looking for ways to operate more efficiently and effectively,” Wal-Mart said. “While we continually look at our corporate structure, we haven’t made any announcements. Like any organization, we make decisions based upon what’s best for our business and the customers we serve.”
Still, Wal-Mart knows that consumers are looking to replace the hassles of physical retail with digital and online commerce, especially at a time when Amazon is breathing down the Bentonville, Ark.-based retailer’s neck. Wal-Mart is targeting an ambitious 20 to 30 percent compound growth rate in e-commerce over the next three years as it prioritizes new store openings. Wal-Mart Stores president and chief executive officer Doug McMillon made the company’s position clear during its annual meeting with the investment community in October.
“As it relates to delivering results and positioning the company to win, you will remember for many years, we talked about growth, leverage and returns,” he said. “[We’d] like to introduce a new financial framework today: strong efficient growth, operating discipline and strategic capital allocation. We have to grow the company for Wal-Mart to have a future, but it’s not a growth-at-all-cost mind-set. We have to change how we do work inside the company. We have a lot of conversations these days about priorities. There are lots of good ideas that we could execute, but they’re not all equal.”
“Yes, we’re not opening the number we opened in previous years, but we’re going to remodel 500 stores and we’re focusing on comp-store growth,” said a Wal-Mart spokesman. “We’re being selective about where we open stores. And we’re doing things at the store level, enhanced Fresh departments and adding grocery pickup to more and more locations.”
McMillon paid $3 billion to acquire Jet.com, but he has more than just cash invested. “Jet.com is a bit more of the urban shopper and skews higher toward Millennials,” the spokesman said. Jet.com last week acquired e-commerce site Shoebuy, which sells contemporary apparel and footwear brands. Walmart.com’s sku count grew to 24 million last year. The Marketplace now sells everything from $3 private-label T-shirts to $1,399.99 Dolce & Gabbana cocktail dresses.
Wal-Mart in the third quarter reported that growth accelerated from the second quarter. “We attributed a lot of that to the Marketplace,” the spokesman said.