Walmart wins bid for liquor license in PA

Walmart submitted the top bid for a restaurant liquor license earlier this year for a store in South Union Township in southwestern Pennsylvania. It's the first liquor license in PA for Walmart, assuming the company files the required application and is awarded the license.

"We want Walmart customers in Fayette County to save money so they can live better," said a Walmart spokesperson, predictably.

According to Shawn Kelly from the Liquor Control Board, if Walmart is granted approval for the license, they will have to turn a portion of their store into a cafe that measures at least 400 square feet and has at least 30 chairs. Walmart would also be limited to selling 192 ounces of beer (approximately two six-packs) per transaction for off-premises consumption.

It is expected that Walmart will apply for a permit to sell up to three liters of wine per retail transaction.

Walmart isn't the first big box store in Pennsylvania to acquire a liquor license. A Target store in Plymouth Township (Montgomery County) has had a restaurant liquor license since last November. Several supermarkets and convenience stores - as well as movie theaters - already own liquor licenses in the state.

Amazon still dominant, but competitors gaining ground

Nielsen reported recently that Amazon's e-commerce lead is shrinking as major brick-and-mortar retailers like Target, Walmart and Kroger - along with e-grocery company Instacart - have outpaced Amazon in percentage growth of online consumer packaged good (CPG) purchases.

In the two-year period beginning in January 2017, the number of e-commerce buyers of grocery and other CPG products for Amazon rose 29%. However, the growth for Instacart (256%), Walmart (207%), Kroger (172%) and Target (122%) was far greater.

According to Nielsen, Amazon competitors gained ground in the last couple years by rapidly ramping up their online grocery fulfillment capabilities for home delivery and for store pickup.

Despite big gains by competitors, Amazon still enjoys a healthy lead. Its reach among U.S. online purchasers is approximately ten times more than any other retailer.

Walmart to spend $83 million on PA remodels this year

Walmart announced last month that it plans to spend approximately $83 million this year to remodel 15 Pennsylvania stores. Stores set for improvements include locations in Harrisburg, Philadelphia and Quakertown, among others.

The $83 million planned for Pennsylvania stores is part of about $11 billion in total capital expenditures planned by the company in fiscal 2020. Nationwide, Walmart plans to add 1,200 autonomous floor scrubbers, 300 autonomous shelf-scanners, 1,200 FAST unloaders and 900 pickup towers to stores around the country. In addition, the company plans to expand online grocery pickup to 1,000 more stores and add another 800 stores.

Artificial Intelligence on display at Walmart lab in Long Island Neighborhood Market

Walmart opened its new Intelligent Retail Lab last week inside a 50,000 square foot Neighborhood Market grocery store in Levittown, NY, which is on Long Island. According to the company, the store will test new, innovative ideas with the help of artificial intelligence-enabled cameras, interactive displays and a massive data center (in full view of customers).

Plans call for the IRL team to use real-time information to explore efficiencies that will allow associates to know when to restock products, and make sure shopping carts are available and registers are open. In addition, customers can access interactive, educational displays, and find answers to commonly asked questions.

According to a Walmart executive, the IRL is meant to improve the shopping experience for customers, and also improve the employee experience.

"The technology has been built to improve associates' jobs, the make their jobs more interesting, and to help them alleviate some of the mundane tasks. AI can enhance their skillset in a very rapidly changing world."

Price comparison finds Whole Foods and Acme as most expensive in Greater Philly

A December story on Philly.com reported the findings of a Consumers' Checkbook study that compared prices of 19 grocery stores in the region. The lowest prices? Walmart. The highest? Whole Foods.

"When Amazon purchased Whole Foods last year, many consumers were excited by the prospect of paying Amazon-like prices for Whole Foods-quality products," said Checkbook Executive Editor Kevin Brasler. "But we're not there quite yet."

Checkbook staff members checked prices on 154 common items, and they surveyed thousands of consumers to assess the quality of the products and services offered at the stores. Although Whole Foods scored poorly on price, it was one of the highest rated grocers.

Unfortunately for Acme, it was not only one of the highest-priced grocery chains, but it was also one of the lowest rated. Only Whole Foods was more expensive.

The highest rated store in the region was Wegmans, and their prices came in at three percent below average.

Walmart has quickly become the top online grocer in the U.S.

The world's largest retailer is quickly becoming a big factor in online grocery shopping. In fact, consumer market researcher Packaged Facts said late last year that 23% of online grocery consumers cited Walmart as the retailer they use most for groceries. Amazon is the only retailer cited more often (38%).

As far as in-store grocery shopping goes, Walmart is the king. About 27% of in-store shoppers said Walmart is the store they most often buy groceries from. That's more than double the number of people that cited Kroger, the second most popular food retailer.

Package Facts noted that Walmart has successfully transformed itself into an omnichannel retailer, in part by turning its thousands of stores into a competitive strength in distribution.

By the end if its 2019 fiscal year (1/31/20), Walmart expects to have 2,140 online grocery pickup sites, covering nearly 70% of U.S. households, and online delivery through 800 stores, covering about 40% of the population.

The company expects to reach its goal of 40% growth in U.S. e-commerce sales for fiscal 2019.

Trader Joe's tops annual Retailer Preference Index

According to Dunnhumby's second annual Retailer Preference Index (RPI), Trader Joe's was the top grocery retailer, followed by Costco, Amazon, H-E-B and Wegmans. In a survey of 7,000 U.S. households, the RPI examined 56 grocery retailers to determine which companies have the strongest combination of consumer emotional sentiment and financial performance.

Market Basket finished 6th, followed by Sam's Club, Sprouts Farmers Markets, WinCo Foods, Walmart, Aldi, Peapod and The Fresh Market.

Dunnhumby said the rankings focused on seven "pillars": price; quality; digital; operations; discounts, rewards and information; convenience; and speed.

The company concluded that the top retailers on the index are mostly nontraditional grocers that have developed a highly targeted offering to bolster the value perception for their customer base.

"More traditional, regional grocery banners with a long history are hurting because of it, having relatively poorer-performing financials and/or emotional bonds," Dunnhumby said. "The reason: These traditional banners have inferior price perception and/or quality."

Trader Joe's also finished atop the rankings last year.

Giant/Martin's and Stop & Shop to add robots that roam store aisles

Giant Food Stores announced earlier this month that each of its Giant/Martin's and Stop & Shop stores will soon feature a 6-foot, 5-inch, 130-pound robot named Marty.  Marty will scan the aisles for fallen items, and will move around slowly enough for customers to take selfie's with it, according to President Nicholas Bertram.

The effort is being hailed as the largest front-of-store robot rollout in the world.

Badger Technologies CEO Tim Rowland explained that Marty can detect objects and movement, and will avoid bumping into shoppers. If something falls off a shelf, Marty will find it and activate an alert system that will result in an employee coming to pick up the item. Badger Technologies partnered with Giant's parent company, Ahold, to create the robot.

Marty also has the capability to scan shelves for out-of-stock items, but that is not part of the initial rollout.

According to Giant, the new technology will not replace employees; rather, it will "replace tasks."

Last October, Walmart said that 78 stores had a self-driving robot cleaning floors, and that they planned to expand the technology to 360 stores.

Walmart adds online delivery service in select Philly markets

According to a company news release, Walmart began online grocery delivery service late last month to Philadelphia and select suburbs, including King of Prussia, Warminster, Kennett Square, West Berlin and Cinnaminson.

Customers in these areas can shop for items on Walmart's website and choose a delivery time, including same-day delivery for an added fee.

Walmart plans to offer its online delivery service in 100 metropolitan areas by the end of the year.

Study shows that consumers still prefer visiting supermarkets for groceries

Despite all the hype around online ordering and delivery services, a recent study conducted by TABS Analytics found that conventional supermarkets and Walmart are overwhelmingly the top destinations for regular grocery shopping.

Of the 1,000 U.S. adults surveyed, 75% said traditional grocery stores were the retail venues they regularly visited to buy food and beverages (more than six times per month), and 57% cited Walmart.

However, compared to last year, 2% fewer people named supermarkets and Walmart as the places they regularly shop for food and beverages, and 2% - 4% more customers named dollar stores, drug stores and discount grocery stores. Target, Trader Joe's and Whole Foods saw gains as well.

Just one in six consumers said they regularly shopped online for groceries.

Whole Foods taking a small bite out of Trader Joe's traffic

In the past year, Whole Foods has increased foot traffic at the expense of Trader Joe's, Walgreen's and Dollar Tree, according to Sense360, a California-based company that tracks location data from millions of smartphone users. The data covers Whole Foods locations that are within a mile of competing stores.

In addition, the number of shoppers who visited a Whole Foods at least six times in the past year increased to 11 percent in August as compared to 9 percent a year earlier, according to surveys by consumer products research company Tabs Analytics.

As for the competition for grocery dollars between Amazon / Whole Foods and Walmart, a former Amazon executive said that Amazon is "willing to experiment and be totally misunderstood for long periods of time. Walmart is built to deliver pallets to 4,000 stores and Amazon is built to deliver packages to millions of homes. Who do you want to bet on: the pallet people or the package people?"

Walmart poised to surpass Amazon as online grocery leader

A report released last week by Deutsche Bank Securities found that as a result of Walmart's investments in e-commerce, the company may overtake Amazon in online grocery market share by the end of the year.

"The retailer is reaping the returns of many years of investment in e-commerce and customer service," said Deutsche Bank Analyst Paul Trussell. "We believe the company is now in position to accelerate market share gains in grocery while also growing EBIT dollars and expanding ROI."

According to Walmart, the company offers online grocery delivery service in over 50 markets and more than 2,000 pickup locations. Walmart projects that it will have pickup sites in 430 markets, covering 69% of U.S. households, by the end of January 2019.

In 2017 Amazon had online grocery sales of $2 billion for a 12.5% market share. Walmart was close behind with sales of $1.78 billion and an 11.1% share.

Trussell believes Walmart could reach a 17% online grocery market share by 2025.

Walmart testing self-driving cars and robots

Walmart's vice president of digital operations said late last month that the company plans to pilot an online grocery service with self-driving cars that pick up customers at their homes and take them to the store to collect their orders. Walmart plans to test the service in Chandler, AZ with Waymo, formerly Google's self-driving car project.

A customer in the pilot program would order his/her groceries at Walmart.com, choose online grocery pickup and select a pickup time. A personal shopper gathers the items, and then a Waymo vehicle picks up the customer, brings him/her to the selected store to get the groceries, and drives the customer back home.

Waymo has also teamed up with shopping center owner DDR, which will offer rides in Waymo self-driving vehicles to Ahwatukee Foothills Towne Center in Chandler.

One week after the announcement, Walmart revealed that it plans to test a program that would have robots bring products to its in-store personal shoppers in an effort to speed up online grocery pickup.

An automated storage and retrieval system, developed by Alert Innovation for Walmart, is being installed at a Walmart supercenter in Salem, NH, where it is adding 20,000 square feet to house the system, warehouse online grocery orders, and serve as a pickup point with drive-thru lanes for customers.

A Walmart spokesperson said that "the vast majority of grocery products we offer in-store will be fulfilled through this system, though our personal shoppers will still hand-pick produce and other fresh items."

The Salem store remodel will also include pickup towers for online orders; an automated shelf-scanner that helps identify out-of-stock items, incorrect labels and missing labels; and Walmart's FAST unloader system to get products to the sales floor more quickly.

Kroger partners with China e-commerce giant Alibaba

Kroger announced last week that it plans to test sales of its Simple Truth natural and organic brand  through Alibaba, China's largest e-commerce retailer. The move will give Alibaba's 500+ million Chinese consumers access to Kroger's Simple Truth brand.

Kroger pointed out that the partnership supports its strategic plan to redefine the grocery customer experience by growing its private brand program, creating customer value and driving top-line growth via alternative revenue streams.

The Alibaba deal also means that Kroger is following Walmart and Amazon, who have significantly boosted their e-commerce presence in lucrative foreign markets.

Amazon remains the low price online grocery leader, but Walmart is closing in

A study conducted by e-commerce specialist Profitero claims that Amazon remains the low price online grocery leader by a slim margin over Walmart. Profitero's "Price Wars: Grocery, Household & Beauty" report found that Walmart.com's grocery prices average 1.8% more than Amazon's.

Target ranked third in the study with Walmart's Jet.com coming in fourth.

"With consumer buying decisions increasingly based on price, and dynamic pricing made possible through technology and advanced algorithms, the so-called 'price wars' have escalated," according to Profitero. "Some recent industry studies have fundamentally concluded that while Amazon is often less expensive than its online counterparts, its price-leading position is being challenged by competing retailers, especially Walmart."

BJ's expands Instacart partnership

BJ's Wholesale Club, which has been marketing heavily to Sam's Club customers since the Walmart-owned company closed several stores, has expanded its same-day delivery agreement with Instacart and will soon offer the service from all 215 stores.

Instacart also recently expanded its partnership with Costco, Kroger and Aldi. According to Kroger, two-thirds of its customers now have access to delivery and/or curbside pickup.

Walmart adding grocery delivery in 100+ markets

Walmart announced that it plans to expand its online grocery delivery service to more than 100 metro areas around the country. The company says the service will be available to more than 40 percent of U.S. households by year-end.

Currently Walmart's grocery delivery service is available in six markets, where customers can receive their orders the same day in some cases. The fee is $9.95 and the minimum order is $30.

According to reports, Walmart already employs more than 18,000 personal shoppers and will hire thousands more.

Walmart also offers online grocery pickup, where customers order groceries online and pick them up at stores without having to get out of their cars. This service is currently available in 1,200 stores throughout six markets, and the company plans to add the service to 1,000 more stores this year.

Kohl's to add Aldi to stores in pilot program

Kohl's announced last week that it will bring Aldi into as many as 10 stores later this year in an attempt to increase customer traffic and store productivity. The specific stores were not released.

Earlier this year Kohl's CEO Kevin Mansell said the company had "a whole list of partners" ready to fill the space leftover from Kohl's recent efforts to rightsize its footprint. In addition to grocery stores, Mansell mentioned convenience stores and fitness centers as candidates.

Aldi, which continues to expand at a rapid pace, currently has 1,600 stores across 35 states. It plans to expand to 2,500 stores by 2022, which would make it the third largest grocer in the U.S. behind Walmart and Kroger.

Walmart to increase hourly wages, expand parental benefits, close 63 Sam's Club stores

Walmart said earlier this month that it plans to increase its starting wage for all hourly workers in the U.S. to $11 per hour , pay a one-time bonus of up to $1,000 to select employees, and expand benefits for parental leave.

The increased starting rate is scheduled to become effective in February for all Walmart, Sam's Club, supply chain, e-commerce and home office hourly workers. The bonuses, which will range from $200 to $1,000, are for workers who don't benefit from the hourly salary increase.

Walmart President and CEO Doug McMillon said in a blog post that the company is in the "early stages of assessing the opportunities tax reform creates for us to invest in our consumers and associates to further strengthen our business, all of which should benefit our shareholders."

Karen Short, an analyst at Barclays Capital, estimated that tax reform could generate about $4.3 billion in cash flow for Walmart. With the salary hike and increased benefits costing about $700 million plus the incremental cost for expanded parental leave and adoption benefits, Short thinks that about $3 billion per year will be available for the company to invest in lower prices, technology and shareholder returns.

In related news, Walmart said the company plans to close 63 Sam's Club warehouse stores in the next several weeks, with about 10 of the locations to be converted to e-commerce fulfillment centers.

Costco online sales up 43.5%

Costco reported earlier this month that its online sales increased 43.5% compared to the same quarter last year, largely due to website improvements, the ability for shoppers to buy items online and pick them up at the store, and the recent launch of new delivery options. In addition, the company reported that it continues to get a revenue boost from customers who initially come into the store for food, but end up purchasing non-food items as well. (Those who shop at Costco know that it's hard to get out of the store for less than $200!)

Even with the online boost, about 95% of Costco's sales occur in stores.

Costco, the third largest grocery retailer in the U.S. behind Walmart and Kroger, reported net income in the third quarter of $640 million, a 17% increase from the same quarter last year. Membership fee revenue climbed 9.8% to $692 million. The company raised membership fees in June.

"Membership trends and renewal rates are still at the 89% and 90% level," according to Edward Jones Analyst Brian Yarbrough. "I think the model continues to work very well. They've got food that's over 50% of their business, and that drives traffic. And they have great deals, and that creates a treasure hunt nature."