Wal-Mart’s Grocery Share To Grow To 21 Percent

Jun 25, 2004

By George Anderson

Daniel Barry, an analyst with Merrill Lynch, predicts Wal-Mart will capture
21 percent of all grocery store sales by 2013.

Mr. Barry said Wal-Mart will continue to roll out its supercenter concept with
850 new units being built between now and then. As space for the big boxes becomes
harder to find, Mr. Barry is looking for the retailer to build more of its Urban
99 — 99,000 square-foot modified supercenter units.

“By 2013, we anticipate that over 90 percent of the estimated 200 new supercenters
that should be built in 2013 will be some variation of the Urban 99 theme,”
he said.

Wal-Mart currently accounts for 11 percent of the nation’s grocery product

Moderator’s Comment: What will a grocery industry where
21 percent of sales are being generated in Wal-Mart stores look like?

We got a bit of a chuckle the other day reading a story
on the Arkansas News Bureau Web site when Wal-Mart’s chairman, S. Robson Walton,
was quoted as saying, “One of the misconceptions of Wal-Mart today is that we
arrive at low prices because of our size and our ability to get the best deals
from suppliers.”

Mr. Walton then went on to say that there were limits
on what the company could extract from suppliers and that, in many cases, Wal-Mart
actually pays more for goods than its competitors because it doesn’t take all
the deal money that others do.

We wonder who will be getting better deals than Wal-Mart
in 2013 if Daniel Barry’s predictions are correct?

George Anderson – Moderator

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