When a business reaches the scale that companies like Walmart and Amazon occupy, developing meaningful new business areas becomes a challenge.
That's why Chipotle Mexican Grill (CMG) -) and Starbucks stopped developing alternative brands.
For a time, Starbucks (SBUX) -) operated stand-alone Teavana tea shops and Evolution Fresh juice stores. Chipotle, which itself once called McDonald's a part owner, also ran a number of experimental restaurant chains.
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Both companies abandoned those efforts because growing another brand to a level that helped their bottom lines seemed unlikely. That's an even bigger challenge at Walmart and Amazon (AMZN) -).
In many ways, it explains why Amazon has tried a variety of retail concepts, only to close all of them except its grocery and convenience stores. Even those efforts have largely stalled with the company seeing bigger opportunities in licensing ist "Just Walk Out" technology.
Walmart has similarly struggled to enter new areas because the company is already so big. That does not mean it's not going to try, and the chain now has entered an entirely new — and potentially lucrative — space that its regular customers should be happy about.
Image source: Walmart
Walmart moves into pet services
Walmart (WMT) -) wants its customers to buy as much from the chain as possible. Since the retailer has such deep penetration across the country, its best plan to grow sales may be to capture more dollars from its existing customer base.
That's why the chain has added everything from pharmacies to eyeglass retailers, garden stores, and even liquor stores at some locations. The chain wants to be an everything store and now it's trying a move into offering services for pets.
Walmart already sells pet food and other supplies. That means it has the ability to market to pet parents and it believes it knows what they need.
The chain's pet merchandising vice president, Kaitlyn Shadiow, outlined the initial move on Walmart's website:
"We’re uniquely positioned to offer significant savings to customers for all their pet care needs," she wrote. "As we continue to innovate within the category, I’m excited to announce our next step in increasing affordable access to much-needed pet services for our customers.
"Starting today, we’ll open the first-ever Walmart Pet Services center in Dallas, Ga,, located at 3615 Marietta Hwy – a key next step in our mission to help our customers save money and live better,"
Here's what Walmart's Pet Services center offers
In making this move, Walmart is taking on established incumbents Petco (WOOF) -) and PetSmart. The chain's efforts could also be highly disruptive to local providers who offer these pet services.
Walmart essentially wants to become, well, the Walmart of pet services. Shadiow noted that prices for pet-related services have gone up by more than the national inflation rate.
She said that Walmart's goal is to provide price transparency and overall lower prices than the incumbents in the space.
"Walmart Pet Services in Dallas, Georgia, will offer low, transparent pricing for key pet services in a central location within a dedicated storefront," she wrote.
"Services will be offered at Walmart’s Every Day Low Prices, including routine veterinary care (vaccines, wellness exams and minor medical services), grooming (baths, nail trims, teeth cleaning, ear cleaning and basic hair trims) and a self-serve dog wash."
The location is considered a pilot, with Walmart hoping to prove the concept and bring it to other locations. Walmart currently offers in-store vet clinics on-site in more than 65 stores across the country, and all its pharmacies stock pet medicines.
"It's our goal to bring the Walmart Pet Services model to other communities we serve in the future," Shadiow added.
Walmart Pet Services stores will have their own entrances, as only service animals are allowed in the retailer's main stores.
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