Walmart launches new retail model! It hopes to recover through high-profit brand products

It is learned that after the first quarter earnings setback and the profit forecast was lowered, Walmart's desire to sell more high-profit goods has become more urgent. Recently, Walmart announced the launch of new offline stores, which include a large number of its own brands of clothing and home furnishings.

The first of the new stores, which opened just 16 miles from Walmart's Northwest Arkansas headquarters, has fewer shelves in the apparel department and wider aisles for people to browse. Different brands have dedicated areas, such as Reebok and children's clothing brand Justice. It also puts Walmart's own fashion and home brands at the forefront.

Walmart is giving more space in its stores to DTC brands that resonate with younger, social media-savvy shoppers, including razor company Billie and dog food company Jinx.

Walmart Chief Marketing Officer Charles Redfield said the new stores will soon be rolled out nationwide, with Walmart planning to open 30 more redesigned stores by the end of January and hundreds more in the next fiscal year.

Charles Redfield also said that before Walmart rolls out the stores more broadly, they will be used for testing and learning.

Walmart is the largest grocer in the U.S. by revenue, but it wants to boost sales of high-margin items like apparel. Over the past five years, the retailer has launched new brands and formed partnerships with companies such as Reebok, Gap and Justice to expand its offerings in apparel, home and other discretionary categories. These brands typically have higher price points and focus on style.

In the home furnishing space, Walmart is also selling more high-margin items, including lines developed in partnership with Clea Shearer and Joanna Teplin. Walmart CEO Doug McMillon noted that Walmart's product range will help it better weather inflation.

At an investor day earlier this month, he and other Walmart executives stressed that the retailer would continue to offer low prices for shoppers on a tighter budget, but that it also planned to attract customers with more money to spend.

Editor✎ Ashley/

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