Business

3 Predictions for the Future of Retail – from the CEO of Walmart

What will shopping be like in 10 years? No one knows all the details (that’s exciting!), but one thing is for sure: it will be very different than it is today.

Editor’s Note: This piece by Walmart CEO Doug McMillon was originally published Jan. 6, 2017 on the World Economic Forum’s website.

History is clear about that. In the mid-19th century, most people in the U.S. were shopping at small markets. They would tell the manager what they wanted, and then wait for the item to be retrieved from the back or from the supplier. After that came the urban department store, supermarkets, then strip malls and discount stores.

Today, the pace of change is rapid. Ten years ago most customers were reading about the original iPhone, and wondering whether it would be useful. Now they expect to order something on their mobiles, have it delivered or pick it up in store – often on the same day, in a few hours, or even in a few minutes.

It’s up to retailers to adapt to these changes – and in some areas even lead the way – or they’ll fall behind and disappear.

Here’s what customers can expect their shopping experiences to be like 10 years from now:

1. Customer empowerment and even greater influence
Customer satisfaction has always been the number one goal for retailers, and in the future, customers will be more empowered than ever to drive the change they want, as they get more control over their shopping experience.

Technology – the internet, mobile and analytics – is being used to do anything and everything a customer doesn’t want to. Customers want to explore. But they need to have easy access to items they choose to use all the time. The historic trade-off between price and service has been altered by technology and customers expect to save time and enjoy the experience while saving money. They’ll fulfill their everyday needs – items like laundry detergent, paper, light bulbs, grocery staples and shampoo – in the easiest way possible through a combination of stores, e-commerce, pick-up, delivery and supported by artificial intelligence. Customer desires – think emerging fashion, fresh produce, and items they’ve never seen before – will still be fun to explore in stores as well as with technology (think virtual reality).

Retailers that provide a truly unique, enjoyable experience and prepare their associates to provide excellent service will have the advantage. At Walmart we already see the value customers place on personalization and convenience, through our success with grocery pick-up and delivery in several markets around the world.

With the growth of the internet of things, customers will enjoy an increasingly connected or “smart” shopping experience through a network of connections linking the physical and digital worlds into an ecosystem of devices, including vehicles, stores and software. The internet of things, drones, delivery robots, 3D-printing and self-driving cars will allow retailers to further automate and optimize supply chains too. Both sides of the equation – demand and supply – will change dramatically.

In addition, customers will continue to demand transparency around pricing and the supply chain. They’ll have less time to research the products they buy – but they’ll care even more about how they are sourced. They’ll choose to shop with retailers who provide that transparency so they can feel good about the items they purchase. This will require retailers to work with manufacturers to source items responsibly and sustainably. Retailers who do this and share the information will further earn customers’ trust.

2. I’ve seen what you have and I want it, too
Customers all over the world now know, and can see, what people in other countries have, and they want access to it all. And they want it now. Chinese customers want access to Louis Vuitton bags from France and milk from Australia. Not long ago on a visit to Nigeria and Ghana, I asked one of our local store managers what his one wish would be. His answer: “I want you to put a Walmart Supercenter like the ones you have in the US right here and let me run it. My customers and my family have seen what you have and we want it, too. We want those items at those prices.”

As Tom Friedman taught us, the world got flat and now it’s moving fast. The world needs inclusive growth provided in a sustainable manner. People are demanding it.

3. Shared value
With all these changes, retailers will only survive if their business creates shared value that benefits shareholders and society. Social and environmental sustainability will be engineered into our systems, and that will strengthen the communities in which we operate, which will in turn appeal to customers. These changes, however, will require new levels of cooperation and collaboration between retailers and NGOs, governments and educational institutions. Basically, we’ll design retail and other businesses so that all stakeholders (as many as possible) benefit: customers, associates/employees, shareholders, the communities we serve and those in the supply chain.

At Walmart, we’ve already found that investments in training, education and wages for our associates have resulted in higher customer satisfaction. Our customers want our associates to have a great life and they want to see that reflected in their attitudes and the service they provide.

When it comes to environmental sustainability, retailers and policy-makers face new challenges with the increase in packaging waste and emissions that comes with the growth of e-commerce. Shipping packages one at a time is not only wasteful and environmentally unsustainable, it isn’t cost-effective. The demand for convenience will force retailers to come up with new ways to ship items – in batches vs. one at a time – that are better for business and the environment.

While all these changes pose big challenges for retailers, they also represent unprecedented opportunities to innovate on behalf of customers and create new job opportunities for retail associates. I can’t think of a more exciting time to be in retail, to be at the forefront of change and part of an industry that has the potential to provide a better life for millions around the world.

This piece draws on a new report, Shaping the Future of Retail for Consumer Industries, which can be read here.

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U.S. Manufacturing

Helping Americans Sleep Easier, Sinomax Brings Hundreds of Jobs to Tennessee

Manufacturing has always been a hallmark of Tennessee’s economy.

As commissioner for economic and community development in this great state, it’s my job to find lasting opportunities for growth and make them available to the members of our communities.

Tennessee’s commitment to innovation has put us at the forefront of today’s manufacturing renaissance. One of the more recent investments in our state comes from Sinomax – the largest producer of polyurethane foam bedding in China, which now has a facility in La Vergne, Tennessee.

We’re seeing a growing trend of companies reshoring production to the U.S., simply because it is more cost effective to produce and distribute products here. But to the members of these communities, this trend means so much more. While making it a goal to fill its workforce from the local crop of talent, Sinomax has committed to provide 350 La Vergne-area residents with high-quality, family-wage jobs.

I believe the U.S. manufacturing trend will not only continue, but also build momentum to become even more competitive in the years ahead. To stay competitive, we know that companies need a team of qualified workers who can excel in today’s manufacturing environment. Tennessee is fortunate to have an excellent governor who has truly become a pioneer in higher education. Because of initiatives like Tennessee Promise and Tennessee Reconnect, which offer all Tennesseans the chance to earn a postsecondary degree or certificate free of tuition and fees, our state leads the nation in developing and maintaining an educated, well-trained workforce.

We’re sending a clear message to employers about our commitment to building the highly-skilled workforce they need to face the future of manufacturing. And an investment in American jobs and manufacturing means we’re also providing our neighbors with an environment that creates a sustainable path into the future. We are grateful for companies like Sinomax that choose to invest in our state – and our people.

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Business

‘Outside the Box’ Breaks Down Blockchain

“Blockchain” is one of the latest business buzzwords making its way around the internet. But this is one word you won’t want to ignore.

Technology is improving the retail experience in ways you may have never imagined. And when it comes to food safety, we can see the way of the future. In Episode 2 of our podcast, Outside the Box, our guests will help break down how blockchain is improving supply chain – and in some cases, saving lives.

“Breaking Down Blockchain” features Brigid McDermott, Vice President of Business Development for Blockchain at IBM. She’s responsible for driving the growth of blockchain, an emerging platform that can radically improve banking, supply chain and other transaction networks. You’ll also hear from Frank Yiannas, Vice President of Food Safety at Walmart.

Outside the Box is our chance to bring together some of today’s most brilliant thought leaders, innovators and visionaries to talk about the retail industry and the roles it plays in society and the global economy.

Future episodes will explore topics such as “The Workforce of the Future,” where industry experts dissect the issues that will face employees in the coming years, and “U.S. Manufacturing, where we’ll talk to a business analyst, a merchandise supplier and a government official about the challenges and benefits of making products in the United States.

If you’re a business owner, an entrepreneur, a maker, a doer, a consumer – anyone! — this podcast is for you.

Learn more about the series and subscribe, and tell us what you think in the comments below.

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Sustainability

One Company is Helping Keep Walmart and Our Communities in the ‘Green’

Glenn H. Garrett set a standard for protecting community waterways long before “going green” became a common refrain.

In 1996, after witnessing the damage left behind by hurricanes earlier that year, the disabled Marine Corps veteran launched his own business, Retention Pond Services, in his hometown of Wilmington, N.C.

The storms had destroyed the basins that hold stormwater and they were overflowing. Glenn decided to do something about it. Luckily, four years in the Marine Corps – from 1980 to 1984 – prepared him for the hard work ahead.

“It’s not glamorous, not high tech. It’s done with good, old-fashioned manpower,” he said of his business.

Glenn developed a relationship with Walmart in 2002 when a store in Wilmington had a runoff issue in the parking lot. Walmart’s construction division called the state’s stormwater regulators and asked for a recommendation on whom to hire for help. Retention Pond Services was their answer.

When the same issue happened again, this time at another store, Walmart decided to expand the maintenance procedures developed with Glenn’s company. From there, it went nationwide.

Retention Pond Services now repairs, maintains and services stormwater systems for 1,200 Walmart stores and Sam’s Clubs across the U.S. The goal is to help Walmart meet rules and regulations set by the Environmental Protection Agency and reduce the risk of water pollution.

“I remember my first meeting with Walmart [representatives], and they started talking about being ‘green’. I had never heard anyone talk about green – being environmentally conscious,” he said, adding that the retailer encourages suppliers to be responsible by leading by example.

He didn’t realize it at the time, but Glenn and his company would play a major role in bringing that to fruition. He said Walmart has become a standard bearer of stormwater maintenance for big-box retailers throughout the U.S.

Retention Pond Services began with 16 employees. Fast-forward 20 years and it now employs as many as 250 workers each year, including Glenn and three other senior leaders, with clients ranging from retailers to municipalities. The number fluctuates with the seasons, but one thing remains constant – there are always military veterans like Glenn on staff. Several veterans started in junior positions and moved up through the ranks.

The business was hiring veterans before Walmart introduced its Veterans Welcome Home Commitment in 2013, but Glenn said the initiative is a great encouragement for suppliers and veterans alike. “It goes back to [Walmart] recognizing our service and appreciating what we’ve done,” he said. As a veteran himself, Glenn knows that the skills and can-do attitude learned in the military easily transfer over to civilian jobs. Glenn takes pride in his team – “I’m only as good as my worst employee” – and in protecting the environment. Much of that pride stems from his childhood in Chesapeake Bay, Maryland.

“My grandfather used to tell me how great fishing was – about catching massive fish. When I was growing up, there were no fish. The bay was essentially dead, killed by pollution and runoff.”

In the 1970s, Maryland got involved in a save-the-bay campaign, and the federal government’s Water Quality Act followed in 1987. Those actions helped return fishing in the bay to its former glory.

Caring for the environment comes at a cost, whether it be time or money, but the results are well worth it. As U.S. businesses continue to grow, Glenn and his team are ready to step in and protect our communities.

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Opportunity

Retired Store Manager Fashions Second Career Out of Dreams and Opportunity

Sometimes it’s not enough to follow your dreams. You also need someone else to see your potential.

My career at Walmart was a dream – so unanticipated! And that set me up to follow yet another dream. After nearly 20 years, I retired Feb. 17 as manager of supercenter #2914 in Massillon, Ohio, to start my own business as a fashion stylist – something I’ve been passionate about for years – and to spend more time with my precious family.

I have long had an interest in fashion, starting back when my mother was a seamstress and would create her own designs as I was growing up. Most of my wardrobe was handmade by her! I always loved how wearing something special made me feel. Working at Walmart, particularly with women, rekindled a passion in me to witness the impact of dressing well. Increased confidence, better communication, direct eye contact – we all know how that feels. Feeling positive about ourselves can be transformational.

My retail career had simple beginnings in 1997, when I was a stay-at-home mom with five small children in a single-income family. That August I was looking to get a little extra money for Christmas and applied for the first clock-in-and-out job of my life. Walmart hired me as a temporary associate despite my having dropped out of college to start a family and having zero experience in retail. I never would have dreamed I’d take a job stocking store shelves overnight and end up managing 500 people.

This company backed me every step of the way, seeing and believing in a potential I didn't recognize. One of my first store managers took a significant interest in challenging and pushing me to see opportunities that existed. It taught me how important the human touch can be.

I remember one young man who was doing a really good job as an hourly supervisor at my store. Not long after we talked about his potential, he put his job in jeopardy by clocking in late on multiple days. Instead of giving up on him, his direct supervisor asked him what was going on. He shared that his car had broken down, and with no other transportation he’d had to walk the four miles to and from the store. After hearing this, I bought him a bicycle to help put him back on the right track. He ended up going into a management program and is doing really well today.

As for me, my story has come full circle. Walmart not only gave me the acumen and process to run my own business, it also gave my husband and me the financial security to start this second phase of our lives. My baby was in kindergarten when I started my career, and now all my children are grown and college-educated. Freedom in my schedule allows me to be a stay-at-home grandma to five grandchildren.

Having been at the Massillon supercenter for the last four years, it was bittersweet to turn over my keys and the responsibility. But, I’m excited to continue being a cheerleader from the outside. The people I hired are going to go even further than I did with the belief they can have limitless careers.

Photos courtesy of Massillon Independent.

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