Walmart s 46th Annual Shareholders Meeting: Reimagine Retail Again

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1 Walmart s 46th Annual Shareholders Meeting: Reimagine Retail Again Last week, Walmart (WMT) held a weeklong company meeting, culminating in its 46th annual shareholders meeting, which 14,000 people attended. Walmart CEO Doug McMillon urged employees to reimagine retail again, and said the company plans to focus on employees, customers and communities. The company demonstrated many new technological innovations, including drones, cooperation with same-day delivery services and Walmart Pay. Sam s Club is an incubator for much of the technology and many of the upgrades that are later introduced throughout the Walmart store network. Last week, Walmart held its weeklong annual company meeting, which was capped with its annual shareholders meeting on Friday, June 3. More than 14,000 people attended the shareholders meeting, which was emceed by late-night TV host James Corden, with performances by Nick Jonas and Katy Perry. President and CEO Doug McMillon: Reimagine Retail Again In his remarks, McMillon encouraged Walmart s 2.3 million sales associates to write the next chapter in the company s history, telling them that they have the opportunity to reimagine retail again. McMillon outlined three key steps for Walmart s reinvention: Supporting and engaging Walmart associates Serving customers Serving communities McMillion reiterated the company s core purpose of saving its customers money so that they can live better and spend more time with loved ones. He said that Walmart is connecting all the parts of the company to offer a seamless shopping experience, and cited the following as examples of the company s progress: 1

2 In China, Walmart has strengthened its stores by building a modern supply chain and is moving forward with pickup and delivery services. ASDA s grocery home-shopping service now covers nearly 99% of the UK. The company is developing pickup or delivery capabilities in 11 countries worldwide. In the US, Walmart s employees are becoming more engaged, the company s assortment of merchandise is improving and the flow of inventory is better. Walmart has launched online grocery pickup in nearly 40 markets. Additionally, the company plans to offer Walmart Pay in every store by the end of June. It has also recently announced unlimited two-day shipping for Walmart.com purchases and expanded the site s product assortment. Technology Announcement and Demonstrations During the week, Walmart unveiled some of the ways it is using technology to reinvent itself: The company plans to use aerial drones for inventory quality assurance by having them perform inventory checks in its large distribution centers. It is pilot-testing the home delivery of groceries with Uber, Lyft and Deliv in Phoenix, Denver and Miami, respectively. Warehouse club subsidiary Sam s Club is also undertaking a similar test with Deliv. McMillion used Facebook Live to broadcast his thanks to the company s associates. 2

3 JUNE 5, 2016 Other Announcements and Highlights Walmart also highlighted its test kitchen, which it calls its Culinary & Innovation Center. The company has developed many new food products at the center, including Sam s Choice premium ice creams and Mystery Peeps sweets. Walmart also highlighted its use of real-time data through its My Productivity app, which empowers managers to manage their businesses directly from the sales floor. From the app, managers are able to restock specific items, access real-time sales data and trends, answer customer questions, and review immediate feedback from customer surveys. Innovations from Sam s Club Many innovations at Walmart are created and tested at a nearby Sam s Club, which is located less than two miles from the company s headquarters. For example, the store features parking spots and charging stations specially designed for electric cars, as well as two drive-through lanes for quick pickup. The company is also testing a Scan & Go service at Sam s Club, whereby customers can scan and pay for items using a smartphone app, completely eliminating the need to stand in a checkout lane. The app is currently being tested in 30 Sam s Clubs across the US. 3

4 The Sam s Club close to Walmart s headquarters also features on-site sushi chefs, a butcher shop, walk-in freezers for fresh items such as freshly squeezed orange juice and lemonade, digital self-service payment stations, an expanded list of healthier food options, and charging stations in the seating area. 4

5 Deborah Weinswig, CPA Managing Director Fung Global Retail & Technology New York: Hong Kong: China: John Harmon, CFA Senior Analyst HONG KONG: 10th Floor, LiFung Tower 888 Cheung Sha Wan Road, Kowloon Hong Kong Tel: LONDON: Marylebone Road London, NW1 6JQ United Kingdom Tel: 44 (0) NEW YORK: 1359 Broadway, 9 th Floor New York, NY Tel: FBICGROUP.COM 5