Walmart could be the next Sears. Amazon is taking over. Anybody think otherwise?

I think Walmart will be with us for a while. At a PE of around 18 (source: Nasdaq.com), I am not running out to purchase Walmart anytime soon. It implies a 5.6% return assuming zero growth. It will be interesting to see if Jet or Walmart.com grows into something meaningful.

If there is a downturn in the economy, WMT will be one of the stocks I check.

Amazon just offered 1/2 price prime to low-income households. They're attacking the Wal-Mart demographic hard!

ColinAggie said:

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Amazon just offered 1/2 price prime to low-income households. They're attacking the Wal-Mart demographic hard!

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Can they spend food stamps at Amazon? Until then, walmart is not going anywhere.

Considering Bezos is a flaming liberal, I wouldn't doubt if it is high on his list and it likely won't be long until it is integrated in some manner.

Didn't Walmart just post stronger than expected online sales numbers in Q1?

Just wait until Alibaba moves deeper into the N. America.

Right now Amazon can't beat the Walmart online ordering/pick up process for me. Just pull up and they will load all of the groceries, no sitting around or watching the clock for a delivery.

I drive past 3 grocery stores to go to Walmart, But maybe I'm old

You do realize Amazon is starting grocery pickup service, right?

You can not spend food stamps online with Amazon or anyone else. The card must be presented and used in person.

No way to spend it on a website. Amazon is lobbying for it to change. Wal-Mart and Dollar are lobbying so it never does.

A significant percentage of shoppers are on some type of govt assistance program.

Wal-Mart is a staple year after year near the top of the Fortune 500. As others have mentioned, its distribution channels and logistics are second to none, and it's the number two e commerce retailer (amazon is #1 by a wide margin.. last I checked it was about a $60B gap).

E-commerce is growing but wal-Mart has evolved and positioned itself to get its portion of that growth. It's going to be a long, long time before traditional retailing is obsolete, and because wal-Mart has shown to innovative and willing to adapt to market trends, it's currently not subject to becoming one of the first to go.

How much more can Wal-mart grow though in terms of their brick and mortar stores? They are everywhere. I see they've tried to adapt with those "local neighborhood" stores which are basically a Dollar General with some groceries in it, but those aren't living up to their expectations. I'm curious how much more growth they can squeeze out of this machine. But I do agree with the above that they will not be the first ones to fail. Stores like Target would come first. I swear every time I go in there it is soooo quiet, almost like a library haha. Who shops there?

I stay out of all stores if I can, but happily shop at Walmart. I live a few miles from one that is not overrun with ghetto trashed-out idiots.

Walmart, Academy and HEB are just about the only stores I will step into that are in proximity to my home. Just anecdotal but I think that if you provide a clean, safe shopping envrionment, brick and mortar stores still are useful.

Interesting... the W-M Neighborhood stores they are opening around me are 90% groceries. What is very interesting is that , even though they are in non W-M type hoods they attract typical WM shoppers. I have asked around my street and everybody still drives past the WM grocery store and goes to Kroger or HEB even for just a handful of items.
What will possibly really shake up the online world is Amazons push to develop its own delivery service . If it really takes off it will leave UPS and FedEx with monstrous infrastructure and without its main customer. I can see an aggressive partnership between WM and UPS and perhaps FEx and say.. Target. The brilliance of the marketplace will not allow a single entity ( Amazon) to continue to totally dominate the online world. I think that in 5-10 years we will see fleets of Amazon , WM and Target trucks ( maybe self driving in some locales) replacing the hordes of UPS or FEx trucks we see today.

nm

newmayne4 said:

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Walmart could be the next Sears. Amazon is taking over. Anybody think otherwise?

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Does this mean my town will finally get a Walmart, and we can get rid of our Kmart?

There is a FedEx center inside the Walmart of my hometown.

I was told in a discussion with some store managers that Walmart has plans to take the Houston area to 150 stores. 1 store minimum every 10 square miles.

Rexter said:

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I was told in a discussion with some store managers that Walmart has plans to take the Houston area to 150 stores. 1 store minimum every 10 square miles.

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I am assuming they are talking about the Neighborhood grocery stores...they have built 2 of em in fairly close proximity to me ( Barker-Cypress) in just the last year or 2.

I always wonder if Amazon buys out FedEx or UPS if things get bad. Get the assets cheap and some institutional knowledge.

~egon

I think what we are seeing and have seen for years is that Walmart shoppers generally trend to poorer demographics.

People like me who hate large groups of people or more affluent will shop at other stores or via online merchants. Amazon is a big winner here.

While some Walmart stores are clean, neat and not full of hillbillies or likewise, that is the exception rather than the rule. Walmarts bring higher crime, increased traffic and neighborhood devaluation.

I have two Walmarts nearby. I have lived here a little over three years and I remember visiting each one once. I wasn't impressed and the parking lots were madness. There is an HEB 7 minutes from my house were I can get the same things I would buy at Walmart and the employees, store and parking lot are nice. If HEB doesn't have it Amazon might be able to deliver it in two hours or two days depending on location and I get a much better selection.

I don't think Walmart is dying, but definitely past the peak. It's a mature business and very easy for other businesses to steal more affluent shoppers.

newmayne4 said:

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How much more can Wal-mart grow though in terms of their brick and mortar stores? They are everywhere. I see they've tried to adapt with those "local neighborhood" stores which are basically a Dollar General with some groceries in it, but those aren't living up to their expectations. I'm curious how much more growth they can squeeze out of this machine. But I do agree with the above that they will not be the first ones to fail. Stores like Target would come first. I swear every time I go in there it is soooo quiet, almost like a library haha. Who shops there?

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I think the next phase you'll see with WM is pickup centers. As they're building their online grocery business, they have a spot for customers to pick up outside, but WM employees are shopping the store's retail shelves to fill these online orders which adds a lot of cost in the supply chain. So in the next few years I think we'll start seeing separate locations altogether for shoppers to pick up bulk grocery orders, which would also give them some room to better target people that don't want to go anywhere near a regular WM.

Dr. Doctor said:

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I always wonder if Amazon buys out FedEx or UPS if things get bad. Get the assets cheap and some institutional knowledge.

~egon

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Amazon is pouring a lot of $$ into its own alternative to UPS/FEx. I would think that , since it will be a duplication of service once Amazon reaches the size that they can pull a huge % of its business from UPS/Fx, the likely suitor will be the brick and mortars who must compete with Amazon to survive.
Gonna be fascinating.

DannyDuberstein said:

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newmayne4 said:

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How much more can Wal-mart grow though in terms of their brick and mortar stores? They are everywhere. I see they've tried to adapt with those "local neighborhood" stores which are basically a Dollar General with some groceries in it, but those aren't living up to their expectations. I'm curious how much more growth they can squeeze out of this machine. But I do agree with the above that they will not be the first ones to fail. Stores like Target would come first. I swear every time I go in there it is soooo quiet, almost like a library haha. Who shops there?

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I think the next phase you'll see with WM is pickup centers. As they're building their online grocery business, they have a spot for customers to pick up outside, but WM employees are shopping the store's retail shelves to fill these online orders which adds a lot of cost in the supply chain. So in the next few years I think we'll start seeing separate locations altogether for shoppers to pick up bulk grocery orders, which would also give them some room to better target people that don't want to go anywhere near a regular WM.

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Already happening .
http://talkbusiness.net/2014/04/wal-mart-to-build-online-grocery-pick-up-center-in-bentonville/

Some anecdotal information for this thread:
Amazon: I've purchased around twenty items from amazon in the past few weeks. Most were two day shipping, some were next day shipping, and a couple of items were same day. The combination of price and convenience was unbeatable. The only potential negative was the guy delivering stuff out of an unmarked vehicle that looked somewhat sketchy.

Walmart: I do a good bit of shopping at Walmart. I decided to give there online shopping a chance since I had a gift card. The Bluetooth speaker I purchased was the same price as amazon but I have two wait two weeks for it. On amazon, in could have gotten free(prime) next day delivery.

Way more "poor" shoppers than affluent shoppers, and that will not change. For a lot of communities in Texas (and across the country), Walmart is the only show in town, another thing that won't likely change.

As mentioned on this thread, Walmart is willing and already adapting to Amazon. Walmart could easily develop their own delivery system, but they don't need to. Walmart could cater to affluent shoppers if they chose to do so, but they don't need to. Walmart is doing just fine, and will continue to do just fine as they see fit.

On the brick and mortar front, I notice that Academy seems to be growing still. Does that make sense? I figure online would be destroying their store, but my local store is jam packed every weekend. Perhaps it is just the allure of a new store though.