For decades, Walmart has been the go-to place for families to purchase all the Christmas essentials to get into the holiday spirit.
From Christmas trees to gift wrapping paper to gifts for the entire family, Walmart had everything one may or may not need ahead of the holidays and for incredibly affordable prices.
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With shelves stuffed to the brim and so many products to choose from, it was hard not to exit the store without purchasing one or two items too many.
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However, this year may look slightly different than the rest, maybe even a little less festive than usual.
Walmart focuses on managing inventory to drive profits
Walmart prides itself on being a one-stop shop where its customers can find everything they need, whether it be electronics, clothing, or groceries.
However, the retail giant is also known for providing everyday value by offering a wide range of products at low prices.
Walmart has maintained its value-focused approach for years by operating its business with a low-cost mindset, which it has implemented throughout its suppliers, transportation, storage, third-party service contracts, and other expense categories.
To further enforce this mindset, Walmart developed Walmart Data Ventures, a business application that obtains data analytics and insights by monitoring consumer behavior with omnichannel sales and inventory trends.
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According to its second-quarter earnings report for 2024, Walmart's global inventory was down by 2% compared to the same time last year, with a 2.6% decrease in the U.S.
This retail giant's inventory reduction likely reflects an effort to maintain healthy in-stock levels by better managing its inventory mix. This allows for a more efficient inventory clean-up, with fewer clearance items, to prepare for the next season.
Walmart slashes its Christmas inventory shipments
Walmart (WMT) has apparently slashed its Christmas inventory ahead of the holiday season.
According to data by ImportYeti, Walmart shipped at least 340,000 kg of products into the U.S. that are described as Christmas goods in the 12 months ending Sept. 30.
At the same time last year, Walmart shipped at least 980,000 kg, nearly three times more Christmas products than the amount reported for this year.
As shocking as this cutback on such popular seasonal items may sound, Walmart has quietly embraced this trend for the last few years.
During the same 12 months of 2022, Walmart shipped over 1.9 million kg of Christmas products, an astonishingly large amount compared to this year.
A Walmart spokesperson for the company told Reuters that it “Only paints a partial picture of what we source due to the exclusion of data from marketplace, national brands, and domestic importer data for private brands, among other things.”
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In its last earnings call, Walmart made almost no mention of its Christmas inventory and rather focused on back-to-school inventory and sales, as it was too early to predict the holiday season's results.
The retail giant will publish its third-quarter earnings for the year on Nov. 19, which is when it will provide more detail on all Christmas-related inventory and projections.
"It is nice that the early days of back to school went well. Sometimes -- most times, I guess, that does give some indication as to how Halloween and Christmas will go. We bought increases, and we're playing offense. So, we're expecting to have a good holiday," said Walmart CEO C. Douglas McMillon in Q2's earnings call.
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