Walmart completes pullout of Neighborhood Market format from Connecticut

Connecticut, Maine, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, and Vermont. No non-grocery posts.
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Super S
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Re: Walmart completes pullout of Neighborhood Market format from Connecticut

Postby Super S » May 18th, 2017, 9:40 pm

pseudo3d wrote:
cathandler wrote:Walmart also looked into putting the Neighborhood Market format in New Jersey but abandoned the idea. I think Walmart has figured out that the grocery sector is so overstored in the Northeast that a dedicated grocery format isn't going to produce the kind of return they expect of their stores. That said, I don't think the Neighborhood Market format itself is headed for extinction.

Neighborhood Market does well in some markets and poorly in others. In Dallas it did well, paving the way for future Supercenters and absorbing former Albertsons stores as the chain shrank, but in Houston it never gained traction (I don't think they ever had more than half a dozen) and wasn't nearly as successful. The heavily unionized area probably make it difficult to compete as well.


Walmart has been rolling out the Neighborhood Markets around the Portland, Oregon area as well, an area which has shown quite a bit of opposition to the traditional Walmart stores, as well as an area with an established Fred Meyer presence. They may be stepping it up a bit as Albertsons as well as Haggen were already shrinking before all of the mergers, but I honestly do not think it has had much of an impact in Portland.

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Re: Walmart completes pullout of Neighborhood Market format from Connecticut

Postby pseudo3d » May 25th, 2017, 3:47 pm

I can't really figure out Walmart NM to be honest. The one I visited in 2013 (not sure on others) did not have full service departments and the whole line-up seemed pretty shallow. With no full service departments, you'd think it would be cheap to operate, but it closed in 2016 with a number of others anyway. They don't exist in markets without Supercenters (so it's not an "alternative"), they don't have full service departments, they're not particularly competitive on items (like milk, which is priced higher at local Walmarts than it is at Kroger or H-E-B), they don't offer a compelling merchandise mix (like Aldi), they lack the GM that drives regular Walmarts, and they don't have the volume to really succeed anyway. Frankly, I wouldn't be surprised if a lot of them weren't turning a profit at all.

The only way Walmart could make them work effectively (I think) is have them be "test stores" in future Supercenters in actually formulating a product and service mix that would be good for a Supercenter (as in Dallas they've been replaced by Supercenters) or try to create a new store divorced from the full "Walmart" experience that offers a more "upscale" feel with less GM (like a typical 40k-80k traditional food and drug supermarket) in areas that wouldn't tolerate a full Walmart Supercenter.

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Re: Walmart completes pullout of Neighborhood Market format from Connecticut

Postby buckguy » May 25th, 2017, 5:37 pm

They rolled out NM stores at a time when their core business was saturating many areas and losing its luster--places that normally welcomed new development were starting to not welcome Walmart. Also, they were facing better competition from limited assortment stores (and from dollar starts around their general merchandise lines). So--you have a tarnished mature brand, with alternatives. A lot of people will stockup on packaged goods at WM as long as they could get a good price, but do the rest of their shopping elsewhere. If people want to go to WM, they go to WM, they don't need a limited assortment version of their groceries. WM is not big on market research--they'd rather impose their preconceived ideas on people, whether shoppers or suppliers--it's pretty well documented, so of course, these haven't done well.

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Re: Walmart completes pullout of Neighborhood Market format from Connecticut

Postby storewanderer » May 25th, 2017, 9:37 pm

The only busy Neighborhood Markets I've seen have been in California and also one in Bentonville. I've been to others in various states and they are typically morgues. I have never seen them with more than 1-2 checkouts open and never see lines. I was in one yesterday in Wichita, KS and mid-day it had less than 4 other shoppers yet had 3 registers open plus a bunch of self checkouts. Dillons across the street had about 200+ cars in the parking lot and was packed. Aldi was (re?)building a store right next to the Neighborhood Market which I can't imagine will help them much.


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