Wal-Mart Tests Convenience Stores

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As competition for its big-box business and its Sam’s Club operation increases, Wal-Mart Stores Inc. (NASDAQ: WMT) has begun to look for other sources of revenue. One may be a line of convenience stores.

According to The Dallas Morning News, one of the first test stores has opened in Crowley, Texas, a small town south of Fort Worth. The other is near Wal-Mart’s Bentonville headquarters. Wal-Mart spokesperson Anne Hatfield said: “We’re eager for feedback from customers. We want to know what’s working.”

The two stores are tiny, at 2,500 square feet each. A typical Wal-Mart supercenter has 180,000 square feet on average. Both of the test stores are in parking lots near supercenters.

The Dallas paper describes what’s inside:

There’s the multi-colored ICEE machine, hot dogs sizzling on a roller, and beer stacked in a walk-in refrigerator.

Not unlike that tens of thousands of convenience stores found across the United States.

The stores are so small they are unlikely to have an effect on Wal-Mart’s financial health anytime soon. The world’s largest retailer had revenue of $482 billion in the 2016 fiscal year. It has 2.3 million employees in the world. Its U.S. employment figure is 1.5 million, which makes it the largest employer in America.

Wal-Mart continues to advance on a number of fronts in an effort to jump-start sales growth. Recently it bought Jet.com, a rapidly growing online retail business. It paid $3 billion cash for the company, and another $300 million in Wal-Mart stock to be paid over several years. More recently it bought another e-commerce business. This month it bought Moosejaw, a retailer of outdoor gear, for which it paid $51 million.

The convenience store business would seem to be small. However, 7-Eleven, the convenience store king, has over 60,000 stores. That gives Wal-Mart something to aspire to.