Walmart's CE Space Constraints Tied To TV Pullback

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Bentonville, Ark. - Walmart is curtailing its recent CE department expansion as it reallocates display space from TVs to mobile devices.

Actual square footage reductions will be limited to roughly one-third of the chain's CE departments, a Walmart spokesman told TWICE. The affected departments were recently expanded remodels that had taken real estate from other categories.

But as part of the discounter's

new initiative

of restoring some 8,500 edited SKUs storewide, CE sections will now relinquish the added space and future CE department remodels will be "more in line with historical square footage allotments," the spokesman said.

Also driving the curtailment are a pullback in TV allocation as sales momentum moves online, and a shift to smaller products like tablet computers that require less display space.

As Walmart U.S. president/CEO Bill Simon told an investor conference last month, the expanded TV layout was based on analysis conducted at the cusp of the analog-to-digital conversion. "We're at a point now where that whole conversion is ... almost complete," he said. "That TV business was a great business to go after... We just have got to be nimble enough at our capital spend to get out of it at the right time and to move through it in an assortment standpoint.

 "A lot of that business will go online," Simon noted, as

expands its TV assortment

to include 3D models from LG, Mitsubishi, Sony, Samsung and Vizio.

At the same time, the retailer is shifting its in-store focus to handheld devices like tablets and smartphones, with an emphasis on Apple products.

"We're much more aligned with Apple right now," Walmart East president Roz Brewer told retail analysts this week. "We are offering the iPad and the iPhone and those kinds of items, and it really does not require as much space as we had projected in the year past."

The real estate constraints do not affect previously announced plans to add SKUs back to CE departments later this year. "We're committed to the broadest merchandise assortment," the Walmart spokesman said, "but electronics products have longer lead times."


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