The world’s largest retailer is going on a diet. Beset by shrinking sales growth, Wal-Mart Stores Inc. said Tuesday that it plans to build fewer, and smaller, stores as it cuts costs to help shore up profits.
For the second time this year, Wal-Mart is trimming plans for capital expenditures to about $15 billion from a June forecast of $15.5 billion in the face of continued decline in sales growth, chief financial officer Tom Schoewe told investors and analysts at a conference. The original projection was $17 billion.
Such efforts come as Wal-Mart’s customers are confronted with mounting financial worries that include not only higher food and gas prices but in recent months a widening credit crunch, which has hurt their ability to spend.
The average size of new Supercenters will fall from nearly 195,000 square feet this year to around 180,000 in the next two years.
The Associated Press
