Home / World Business
Thu, Oct 02, 2003 - Page 12 News List

Wal-Mart won't stop expanding, executive says

AP , LITTLE ROCK, ARKANSAS

The chief executive officer of Wal-Mart Stores Inc, the world's largest retailer, told industry analysts not to expect the company's phenomenal growth to slow anytime soon.

"People ask me, `Can Wal-Mart continue to grow? Can it continue to add 8 percent new square feet of stores per year?' Well, we don't see a change in being able to accomplish those kinds of numbers," chief executive Lee Scott said Tuesday.

"Wal-Mart stores only have 3 percent of the formal market share, so there's no short-or mid-term limit on Wal-Mart's growth," Scott said.

The company plans to open as many as 195 new stores and replace or expand another 160 in the US next year.

Wal-Mart International, meanwhile, plans to open 100 to 110 new stores in existing markets and replace or expand 30 stores.

Wal-Mart maintains that it will post earnings per share from continuing operations during the third quarter of US$0.45 to US$0.47. Earnings are currently tracking in the middle of that range.

In his opening comments for Wal-Mart's analysts' meeting, Scott addressed concerns that the company, which started as a neighborhood five-and-dime, would become an unmanageable behemoth.

"We've learned that the disadvantages of size come without any work at all, but the advantages come with a great deal of work and coordination," Scott said.

Wal-Mart has long prided itself on being immune to nationwide economic downturns, but Scott said the deflationary retail environment will be a challenge.

"This bagless vacuum cleaner went from US$98.88 to US$68.82 in two years," he said. "But the cost of moving the product is absolutely more expensive than it was two years ago. That puts a tremendous amount of pressure on us to increase productivity at the store level."

John Menzer, president of the international division, said deflation in Asia "continues to be a threat," while German and Japa-nese consumer confidence is suffering from price increases.

Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.

TOP top