Wal-Mart to cut 300 jobs at Arkansas headquarters in effort to cut duplication
By Chuck Bartels, APWednesday, February 3, 2010
Wal-Mart laying off 300 workers at Arkansas HQ
LITTLE ROCK, Ark. — Wal-Mart Stores Inc. is cutting 300 administrative jobs at its headquarters as it completes a yearlong series of changes to improve performance. The company has cut almost 14,000 jobs in the past 13 months.
Wal-Mart President and CEO Mike Duke told employees about the latest layoffs in a memo on Wednesday.
“With this last major strategic piece in place, we are beginning our new fiscal year with every part of our business focused on being even more responsive to our customers,” Duke wrote. He said the world’s largest retailer trimmed its labor force to advance its strategy of improving its “growth, leverage and returns.”
The 300 being laid off this month at the company’s Bentonville, Ark., headquarters include workers in corporate affairs, finance, human resources, information systems and legal departments, Wal-Mart spokesman Dave Tovar said.
Wal-Mart, which generated $400 billion in sales last year, has welcomed wealthier consumers trading down from higher-price stores during the recession. But it also has noticed financial strain among its core customers, including bigger swings in spending between paychecks.
Duke said an essential part of Wal-Mart’s culture is always striving for greater efficiency. He said the company’s new fiscal year, which began Monday, is off to a productive start.
“Last fall, we laid out three strategic priorities to deliver even more value for both customers and shareholders: growth, leverage and returns,” Duke wrote. “Each move has been designed to help us become more global, take advantage of our scale, and move our business even closer to the customer.”
The goal, company officials told investors in October, is to cut costs so it can lower prices for shoppers and in turn boost sales.
Wal-Mart, which has 2 million employees worldwide, has changed its global sourcing network and, last month, cut 11,200 jobs in its 600-store Sam’s Club warehouse division when it turned over in-store demonstrations to an outside company. The cut amounted to 10 percent of Sam’s Club’s work force of 110,000. That cut included 10,000 workers, mostly part-timers, who offered product samples to customers and 1,200 workers who recruited new club members.
Sam’s also closed 10 underperforming stores, which cost another 1,500 jobs.
A year ago, Wal-Mart cut between 700 and 800 headquarters workers in its real estate, apparel and health and wellness departments. That layoff followed a reduction in the number and size of new stores Wal-Mart said it would build. The company also plans to renovate many existing stores.
Wal-Mart said last week that it was realigning its U.S. operations in an effort to give more autonomy to executives in regional markets and reinvigorate U.S. growth. Vice Chairman Eduardo Castro-Wright said the changes would help the company better use its resources and “facilitate our growth as we seek to enter new markets and develop new segments across the U.S.”
Wal-Mart isn’t alone in trying to reduce overhead as consumers continue to spend carefully. Home Depot Inc., the largest U.S. home-improvement retailer, said last month would lay off 1,000 employees as it cuts three pilot programs and some support positions. The cut amounts to less than 1 percent of Home Depot’s more than 300,000 workers.
Bookseller Borders Group Inc. announced last month it would lay off 164 employees — less than 1 percent of its work force of 22,5000 — to cut costs amid slumping sales.
Wal-Mart, which reports on its earnings Feb. 18, has experienced some softness in its U.S. business. In the most recent quarter, its Walmart chain saw sales at U.S. stores open at least a year fall 0.5 percent, though total sales rose 1.6 percent in stores abroad. Adjusted for currency fluctuations, international sales rose 12.1 percent.
AP Retail Writer Anne D’Innocenzio contributed reporting from New York.
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