How Bad Are Wal-Mar’s Inventory Problems?
“We have to get better and remain laser-focused every day because momentum can turn against you in a second,” said Bill Simon, the executive vice president and chief executive officer for Wal-Mart’s (NYSE:WMT) United States operations, according minutes from a February 1 meeting, seen by Bloomberg at the end of last month.
Shares of the retailer are up 23.08 percent over the past 12-months and 9.59 percent this year to date, but those fundamentals belie serious problems at Wal-Mart. Earlier in February, an email from Wal-Mart’s vice president of finance and logistics, Jerry Murray, leaked to Bloomberg announced to the world that the company’s sales were a “total disaster.”
The situation was exacerbated when Simon commented at an executive officers’ meeting, leaked once again to Bloomberg, that the company has inventory problems. “We run out quickly and the new stuff doesn’t come in,” he stated, noting that these “self-inflicted wounds” were Wal-Mart’s “biggest risk.” As the publication outlined in an article published Tuesday, Wal-Mart does not have enough workers to restock the shelves, according to interviews conducted with store workers. In the past five years, the company has added 455 stores in the United Stores, a 13 percent increase according to regulatory filings. But the company’s employee count dropped by approximately 20,000 in the same period…