Home Retail Wal-Mart Cuts Costs, Joins Suppliers to Avoid Price Rises

    Wal-Mart Cuts Costs, Joins Suppliers to Avoid Price Rises


    Wal-Mart Stores Inc the world’s largest retailer, is cutting costs and working with suppliers to delay or avoid raising prices as commodity expenses increase, the head of the company’s international unit said.

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    “We find creative ways to work around it,” Doug McMillon, president and chief executive officer of Wal-Mart International, said in an interview at a consumer goods forum in Barcelona today. “First we try to keep our costs as low as we can, secondly work with our supply chain as best we can,” said the executive, who joined the retailer at the age of 17.

    Wal-Mart is “innovating” with transport and packaging to reduce costs, he said, without being more specific. The retailer has posted eight straight quarters of sales declines at U.S. stores open at least a year. U.S. Walmart stores account for almost two-thirds of total revenue.

    The Bentonville, Arkansas-based retailer operates in 14 countries outside the U.S. and had international sales exceeding $100 billion in the most recent fiscal year ended Jan. 2011.

    “We’re experiencing economies in emerging markets that are growing quickly and are very robust,” McMillon said. “The developed markets are more challenging.”

    McMillon wouldn’t comment on speculation of a possible bid for Home Retail Group Plc (HOME) following reports in the Daily Mail newspaper. Asda, Wal-Mart’s U.K. chain, aims to be the largest non-food retailer in its domestic market. McMillon said the grocer is looking at its e-commerce multi-channel offer, where customers order online and collect in-store or deliver to their homes, and the new Netto stores for non-food growth.

    Source : Bloomberg