Wal-Mart’s Project Impact has a Positive Impact on Sales

Wal-Mart remains the world’s largest retailer, even after cutting back on the amount of items stocked on its shelves.

The retailer that boasted more than $400 billion in store revenues in 2009 launched a store remodeling initiative named Project Impact in an effort to boost efficiency and sales. The project started in 2008 and is on track to have reached about 32 percent of its stores by the end of 2010. Forbes reports that the remaining stores should be remodeled by 2014.

Project Impact was put in place to declutter stores and highlight popular merchandise while discontinuing unpopular items. Reduced inventory and improved inventory turnover supports Wal-Mart’s goal to be the low price leader and helps attract customers and increase sales. Many believe the remodeling strategy was a way to appeal to consumers who frequent the retail stores Target and Costco.

Project Impact is reportedly yielding positive results. New customer data shows that Wal-Mart is attracting more upscale customers with higher household incomes and has driven a sales boost of between 1.2 percent and 1.5 percent. Even after bringing back several product categories that were initially cut, Wal-Mart still decreased its inventory volume by 6 to 8 percent, improving its working capital position.

In this volatile economy and fast-paced digital age, retailers can’t afford to be static fixtures. Wal-Mart’s renewed attention to customer service, consumer experience and store management has proved to be a winning combination for the retailer, reinforcing the idea that not all change is bad.