Walmart has found some seemingly simple ways to save hundreds of millions of dollars.
During the company’s fourth-quarter earnings conference call, the big-box retailer revealed several tweaks that it said will allow its business to conserve on costs each year. Walmart said it should save $100 million annually over time by investing in new technology that helps it use store equipment in a more energy-efficient way as well as another $60 million by merely changing its “buying process” for shopping bags.
“Over the past couple of years, we’ve implemented smart-spend initiatives across most of the organization, and you can take a lot of small projects, you can scale them across the business and they can lead to impressive savings,” EVP and CFO M. Brett Biggs said. “We have hundreds of opportunities underway and in the pipeline.”
Further, Walmart is cutting by 15% the cost of the vests worn by store associates, now using recyclable materials that make the pieces “more comfortable and more sustainable.”
It’s not the first time the Bentonville, Ark.-based firm has announced unique cost-cutting strategies: At its 2019 annual shareholders meeting, Walmart anticipated at least $30 million in annual savings by swapping out stepping stools at its distribution centers for more lightweight versions.
The company also previously forecasted trimming $20 million in costs by switching to a new floor wax that was not only cheaper but also reduced the number of times employees needed to buff floors. The company said it was saving $200 million by changing existing lights to LED lights in stores and parking lots.
“These are just a few of many examples of how we’re doing business differently than we’ve done in the past, and small changes can have a really big impact in this company,” Biggs added.
During the fourth quarter ended Jan. 31, Walmart logged adjusted earnings per share of $1.38, compared with analysts’ bets of $1.43. Revenues advanced 2.1% to $141.67, also missing predictions of $142.49 billion, and same-store sales climbed 1.9% versus anticipated growth of 2.3%.
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