Walmart’s CEO has warned suppliers that increased pricing would no longer be accepted if the economy weakens.
The Wall Street Journal reported this, citing quotes from Chief Executive Doug McMillon’s speech to suppliers last month.
According to people with knowledge of the situation, McMillon warned manufacturers of goods for Walmart’s Sam’s Club stores that Walmart will fight any price hikes.
The CEO also said that new items will persuade customers to make more purchases.
According to the report, rivals like Target and Amazon are using a similar strategy, with major retailers canceling orders, rejecting price increases, and requesting discounts from suppliers.
On, Walmart will announce its third-quarter financial results. Seeking Alpha’s pre-earnings analysis concluded that Walmart is “better positioned to weather the uncertainties ahead,” noting that its extensive network of physical stores, which is frequently viewed as a liability by many analysts, will be a huge asset.
According to recent commentary, Walmart was “facing a stretched consumer who was reprioritizing shopping toward groceries and essentials and away from discretionary items in the face of high inflation, bulging inventories, and lots of promotional competition,” as evidenced by the company’s second-quarter earnings.
According to studies, most consumers continue to be terrified by inflation, which alters what they buy and how they buy it and gives them the impression that price hikes and income stagnation are unlikely to end any time soon.
Rising prices continue to be the biggest economic worry, with two out of every three consumers very or extremely anxious about the outlook for the upcoming months, according to the November study “Consumer Inflation Sentiment: Inflation’s Long Consumer Spending Shadow.”
Eighty percent of consumers say that rising prices make them worry about the future, while forty-five percent say that having trouble paying their bills has dimmed their outlook.
