How Much Do Walmart’s Empty Shelves Really Hurt Sales?

revenue of walmart

Image Source: Frugaldad.com

Love them or hate them, you probably shop at Walmart from time to time. If you’ve been reading the news lately, you probably noted how many disgruntled customers are screaming about Walmart’s empty shelves.

The claim isn’t related to a restocking issue; it’s related to the weighty giant not having the items people need. While they go to the store for these goods again and again, they don’t have what they’re looking for.

People with this issue started writing in to Bloomberg to complain.  Their bad reviews quickly captured media attention. At its heart, they claim, is a simple workforce planning issue. Like many companies, Walmart took a hit in 2008 when the U.S. economy tanked, yet continued to build new stores. So, while the workforce has declined by 120,000 over the last few years, several hundred new Walmart locations have been opened.

Let’s just set aside the reputation of Walmart as the Welfare Queen for a moment and take a look at some sales analysis behind the real issues here, shall we?

Cheap is as cheap does.
Walmart does one thing; they sell products cheaply. They not only sell on price, they’ve made this their theme time and time again. For years folks have chronicled the way Walmart haggles down vendors in order to get the lowest prices.

If you want to sell on price, you can certainly be part of this bidding war. You’ll enjoy a cult following of people attracted to your business for one thing and one thing only; a good deal. These price shoppers want it all and they want it at bottom dollar … now. This is the sales monster you create when you’re niche is being the most affordable. It’s very difficult to reinvent your business into anything more debonair since your customer base isn’t loyal to you, they’re loyal to your prices.

competition of walmart

Image Source: Frugaldad.com

If you don’t stock it, people can’t buy it.
Have you ever been to a bar where you waited a long time for a drink? It didn’t matter a bit about the impatience of waiting. What mattered was the loss of sales the slow bartender caused the company. It’s even worse at a $10/drink establishment, actually, since every person that’s not getting served quickly represents a much higher dollar value.

The same concept applies to Walmart. If they don’t sell specific items, they are losing the sale of other items the person would pick up while they’re in the store. If people get tired of stopping by for green beans that aren’t on the shelf, after a while, they’ll start to stop by a store that will definitely have green beans. Don’t hurt your business or your sales by not stocking your shelves (or by employing slow people who hurt your bottom line.) Also, train your people to offer alternatives like, “We’re out of frozen green beans but definitely have the fresh.”

walmart workers

Image Source: Frugaldad.com

Don’t start crying for Walmart just yet. Obviously, they continue to be the largest retailer, beating out Target and many others. They’ve even come up with a strategy to have their customers deliver to online buyers. Do you think that’s innovative?

It’s not. It’s all about the bottom dollar for Walmart. They want to save money on everything. Their bottom line is their only line. And love them or hate them, Walmart’s empty shelves definitely aren’t hurting their sales — it’s just disgruntling their price shoppers.

Need more sales training? Hire Noah today.

 

email
Sales Blog