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Walmart adding new wrinkle to small-store format

A new urban-store concept will focus on fresh food, and Target is about to disclose its own urban-store plan. Whatever the format, smaller packages will be essential.

Creative teams that are attuned to current retail trends on shelf know that package sizes have been getting smaller. That trend will continue, with Walmart’s announcement that it is planning an aggressive expansion move into the nation’s urban areas with smaller stores.

According to an article in U.S. Today, Walmart is reviewing locations in cities around the U.S. for very small stores that carry fresh food. The newspaper quoted Madison Riley, managing director of retail consulting firm Kurt Salmon Associates, as saying about Walmart’s plan, “Urban is just the next frontier. There are only so many places they can grow.”

Walmart has been reducing its store size from the chain’s typical 195,000-sq-ft layout. Four smaller prototypes, called Marketside, are in tests. The stores average 15,000 sq ft and sell primarily fresh food. Walmart also operates nearly 200 Neighborhood Market by Walmart stores, which span 42,000 sq ft. Neighborhood Market features fresh food, pharmacy, beauty, stationery, and pet supply products.

Separately, the newspaper says Target Stores is about to announce plans for its own urban-store strategy.

Smaller stores will mean far fewer products in substantially reduced shelf space. Factor in that retailers are devoting more of their shelf space than ever to their own brands, and shelf facings are at a premium for national brands.

One key to winning the battle for shelf space will be smaller packages, especially those that are easier on the environment. Kraft Foods offers one winning approach, with secondary paperboard cartons for its Oscar Mayer brand’s deli creations flatbread and sub sandwich kits that are 30% smaller than the previous cartons.

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