Walmart Closes Store
No. 8 Innovation Unit
Retail giant closes business unit
meant to incubate new ideas as it also tries to curb costs and test technology in
other ways
Walmart
plans to shutter Store No. 8, a business unit it created to spur innovation, as
the country’s largest retailer works to curb costs and test technology in new ways.
When
Walmart launched the unit seven years ago, it was working to quickly catch up to
Amazon’s growing online business and foster new ideas that might not be immediately
profitable. Walmart had recently spent $3.3 billion to buy Jet.com and placed its
founder, Marc Lore, at the head of the company’s ecommerce operations.
Many
of Lore’s hires worked within Store No. 8, named after the store in Arkansas that
Walmart founder Sam Walton once used to test new ideas. With the recent changes,
Scott Eckert, a senior vice president who led the unit, will leave the company.
“We’ve
graduated capabilities from this operating approach that are now fully embedded
in our organization,” said Walmart Chief Financial Officer John David Rainey in
a staff memo viewed by The Wall Street Journal. Over the past seven years, almost
300 Store No. 8 workers moved on to other internal jobs, he said. “The responsibility
to shape the future of retail is now shared by all segments.”
Many
of the ideas incubated inside the group have either been adopted by the wider company
or shut down as misses. Walmart now offers online delivery into shoppers’ homes
and shopping over text message based on Store No. 8 tests, Rainey said.
The
announcement comes near the end of Walmart’s fiscal year, a time when the company
often announces executive changes and strategy shifts. Walmart has also been working
to reduce expenses in other business areas as consumers are cautious about
their spending.
Last
week, Walmart also sent memos to staff to announce several other executive departures,
including Denise Malloy, who had the title chief belonging officer and joined the
company less than a year ago. Malloy’s title was a new version of a diversity, equity
and inclusion chief, a job that has become more fraught in corporate America as
court rulings and critics make some of the work more challenging.