Big Retailers Dominate E-Commerce

Walmart’s e-commerce sales rose 97% in the second quarter and same-store sales grew by 9.3%, driven by purchases of food and general merchandise, reported CNBC (Aug. 18). Though Walmart customers shopped less frequently, they bought more when they did. The average ticket rose by 27% during the second quarter as transactions fell by 14%.

Sam’s Club membership increased by more than 60% in the quarter—the highest quarterly increase in more than five years. The warehouse club’s e-commerce sales grew 39% and its same-store sales rose 13.3%.

Walmart said its performance was definitely impacted by consumers spending stimulus checks, but the retailer is bracing for the possibility that shoppers could pull back or spend differently during back-to-school season. Compared with previous years, Walmart CFO Brett Biggs noted the pandemic “has made back-to-school a little more uncertain” and “a little more choppy.”

The company did not provide a financial outlook for the rest of the year. It withdrew guidance in the first quarter, saying that many factors could change its performance, including additional government stimulus, the level of consumer confidence, and the length of the pandemic.

Walmart also decided to extend hours for 4,000 of its 4,700 U.S. stores, reported CNN (Aug. 14). It joins other large chains that have started to stay open longer than they did during the early days of the pandemic.

In recent weeks, the retailer extended some stores’ closing time from 8:30 p.m. to 10 p.m. All Walmarts will continue opening at 7 a.m., except on Tuesdays, when stores open an hour early for seniors.

A Walmart spokesperson said the additional hours will allow customers to spread out over a longer period of time. Extending hours also will make it more convenient for customers, said Neil Saunders, managing director at advisory firm GlobalData Retail. The change allows workers to get adjusted to the extended hours before shopping picks up during the holiday season.

The Walmart spokesperson said it will continue the same cleaning protocols with its extended hours and will “continue assessing our remaining stores to determine the right time to expand their closing hours.”

Amazon, which has also done well during the pandemic, is planning to open a 1 million-sq. ft. fulfillment center in Forney, TX, reported Area Development (Aug. 17). The new fulfillment center will launch in 2021 and is expected to create over 500 new full-time jobs.

Amazon is also planning a new 200,000 sq.-ft. delivery station in Forney, which is anticipated to launch later in 2020.

Additionally, the company reportedly wants to take over JCPenny and Sears stores to turn malls into giant fulfillment centers, reported Business Insider (Aug. 9). Amazon is in talks with Simon Property Group, America’s biggest mall owner, to turn empty retail space into Amazon warehouses that process and ship online orders.

The deal could provide Amazon with well-located warehouse space in cities across the country and allow the online retailer to decrease its delivery times on shipments.

Meanwhile, in the UK, the iconic retailer Marks & Spencer is struggling. It will cut about 7,000 jobs over the next three months in its central support center, regional management, and UK stores, reported The Guardian (Aug. 18). The cuts are part of a streamlining program whereby the company aims to emerge from the pandemic as a leaner company with a lower cost base and more resilient business.

Marks & Spencer plans to add jobs for its online operations, including in online fulfillment and a new food warehouse that will be supplied by Ocado. The retailer launched more than 500 new products in stores as part of an expanded online range created for Ocado.