BENTONVILLE, AR - Wal-Mart is slashing the expected growth rate for its chain of big box supercenters by half. According to a press release, the retailer only plans on opening 60-70 of these stores in fiscal 2016, a notable decrease from the 120 new locations set for fiscal 2015.

Instead, Wal-Mart will be channeling the $6.1-$6.6 of billion capital investments it projects for fiscal 2016 into the expansion of its Neighborhood Market chain of stores. Wal-Mart has revealed that it plans on building 240 of its smaller format stores, such as Neighborhood Market, in fiscal 2015, and another 200-220 in fiscal 2016. This represents a sizable jump from the 121 smaller format stores Wal-Mart put up in fiscal 2014.

“We know that our supercenters are an important format for the stock-up trip, but we want to be thoughtful about our investment, ensuring that we align the space to evolving customer needs,” said Wal-Mart U.S. President and CEO Greg Foran. “To do this, we will moderate supercenter growth in fiscal 2016. Our investment in Neighborhood Markets will go forward because they continue to show strong results across the box and they provide our customers with convenient access to grocery, pharmacy services, and other quick-trip needs.”

In the same way that Wal-Mart is backing away from its current rate of supercenter expansion, the growth rate of Sam's Club stores will also be cut as the industry moves into fiscal 2016. The retailer will be putting up 20 Sam's Clubs in fiscal 2015, but in fiscal 2016 this number drops by half to 9-12 stores. According to Wal-Mart, this slowdown is a result of its desire to reinvest in new technologies which will set the stage for future retail growth.

“Our new clubs continue to perform well. Starting in the third quarter of this year, our new clubs incorporate several layout improvements, including an expanded fresh area and a combined health and wellness solutions center. These updates enhance the member shopping experience, and drive stronger sales and leverage labor efficiencies,” said Sam’s Club President and CEO Rosalind Brewer. “We are reducing the number of new club openings for next year and accelerating technology initiatives that integrate our physical locations with our digital capabilities.”

Wal-Mart has also revealed that it will be investing heavily in e-commerce going forward.

“We expect capital investments in e-commerce worldwide to be between $1.2 and $1.5 billion next year and these investments will include technology, infrastructure and other areas to support e-commerce and digital initiatives to serve customers,” explained Charles Holley, Wal-Mart’s Executive Vice President and Chief Financial Officer.

Overall, the company will be adding between 26 and 30 million in net retail square feet in fiscal 2016. The face of these new buildings are changing however as Wal-Mart adapts to the shifting retail environment. Stay tuned to AndNowUKnow to find out more about how Wal-Mart will respond to the future challenges and opportunities of the global retail industry.  

Wal-Mart