Walmart Plans To Take Another Shot At Convenience

Walmart is planning to enter the convenience channel in large cities, despite making little headway with its Marketside small-format concepts which debuted with much fanfare two years ago.

According to The Financial Times, the largest retailer in the world is looking at property for smaller-format stores in urban areas, such as San Francisco and Detroit. "They've been looking at sites between 20,000 and 50,000 square feet over the summer," one broker in northern California told the publication.

Walmart will outline its business plans later this year, according to Bill Simon, the chain's CEO for the U.S. Plans will include convenience stores similar to those it runs in Latin America.

The company is currently planning to enter the Chicago market with more than 20 stores — a mix of supercenters and small-format stores. And Simon said more cities with follow. "You'll see us taking the Chicago approach with other cities," he noted.

No mention was made of the Phoenix approach, though, where four Marketside grocery stores were renamed "Marketside by Walmart" in June of last year in an apparent attempt to remind consumers of the stores' connection to its parent company's value positioning.

The stores debuted as simply "Marketside" with great fanfare in Gilbert, Mesa, Chandler and Tempe, Ariz. The omission of any reference to the parent company was seen as an effort to distance itself from Walmart's low price image and be better positioned to attract a more upscale clientele.

Apparently, that strategy went up in smoke when the economy fizzled and Walmart has put on hold indefinitely any plans to expand the concept.

Expansion of another convenience/grocery hybrid, Fresh & Easy, is also on hold, despite the backing of British supermarket powerhouse, Tesco. Fresh & Easy, which debuted about a year before Walmart's Market side, grew to about 170 stores before stalling.