(New York)

The retail sector has been in tumult for years, but the struggles have intensified over the last few years as ecommerce has accelerated and physical stores are under pressure. The big winner so far has been Amazon, but lately, Walmart has been pushing back with a greatly improved and expanded ecommerce offering. Now, Walmart may be able to grab more market share in the US retail market by undercutting other retailers on price. Walmart has been lowering prices and is now 3-5% below other retailers like Dollar General, Kroger, and Big Lots for the same items. Many of the items are so-called “traffic-driving”.

FINSUM: We can comment on this from personal experience. It is remarkable, especially in rural America, how much minor price differences can entice consumers to drive 10+ extra miles to the store which is perceived as cheaper. We think these price differences will be material.