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NYSE: WMT 1 Session 1

Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

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Page 1: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT1

Session 1

Page 2: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 2

Wal-Mart Stores, Inc. International Field Trip at ASDA• Meeting is being video webcast

• All presentations, including those completed at conferences,are archived for one year at www.walmartstores.com/investors

• Upcoming dates:– April 26, 2010, North Bergen, N.J. Supercenter tour– May 18, 2010, Q1 earnings– June 4, 2010 Annual Shareholders’ Meeting– August 17, 2010, Q2 earnings– October 13, 2010 Meeting for the investment community

Page 3: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 3

Walmart includes the following cautionary statement so that any forward-looking statements made by, or on behalf of, Walmart will enjoy the safe harbor protection of the PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995, as amended. Such forward-looking statements, which will describe our objectives, plans, goals, targets or expectations, can be identified by their use of words or phrases such as “anticipate,” “estimate,” “expect,” “forecast,” “plan,” “projected,” “will be” or words or phrases of similar import. Statements of our expectations for all of FY11, and any subsequent fiscal years are forward-looking. Walmart’s actual results might differ materially from those expressed or implied in a forward-looking statement as a result of factors including, among others, recessionary economic environment, cost of goods, competitive pressures, availability of credit, geopolitical conditions and events, labor and healthcare costs, inflation, deflation, consumer spending patterns, debt levels and credit access, currency exchange fluctuations, trade restrictions, tariff and freight rate changes, fluctuations in fuel, other energy, transportation and utility costs, health care and other insurance costs, accident costs, interest rate fluctuations, other capital market conditions, weather conditions, storm-related damage to facilities, customer traffic, factors limiting our ability to construct, expand or relocate stores, regulatory matters and other risks set forth in our SEC filings. Our most recent Annual Report on Form 10-K and our other filings with the SEC contain more information concerning factors that, along with changes in facts, assumptions not being realized or other circumstances, could cause actual results to differ materially from those expressed or implied in a forward- looking statement. Walmart undertakes no obligation to update any forward-looking statement to reflect subsequent events.

Cautionary statement pursuant to the Private Securities Litigation Reform Act of 1995, as amended

Page 4: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT4

Tom Schoewe CFO Wal-Mart Stores, Inc.

Page 5: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 5

Walmart financial priorities

FY10 Results (Year ended Jan. 31, 2010)

GrowthGrowth

LeverageLeverage

ReturnsReturns

• Grew constant currency net sales 3.4%1

• Added 34 million net square feet• Organic and acquisitions

• Delivered strong gross margin• Leveraged operating expenses in Q4• Continued best practice sharing

• Ended FY10 with Free Cash Flow of $14.1 billion2

• Delivered ROI equal to previous year

1. See additional information at the end of this presentation regarding constant currency net sales, a non-GAAP financial measure 2. See additional information at the end of this presentation regarding free cash flow, a non-GAAP financial measure

Page 6: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 6

Worldwide commitment to Walmart’s productivity loop

Page 7: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 7

Walmart U.S.’s Project Impact strengthens the business foundation

• Lead on price

• Clarify merchandise offering

• Improve customer experience

• Increase productivity

• Enhance ROI

Save Money. Live Better.

WinPlay

Show

Customer

FastFriendly

Clean

Page 8: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 8

Walmart U.S.’s Project Impact strengthens the business foundation

• Assortment

• Rollbacks

Save Money. Live Better.

WinPlay

Show

Customer

FastFriendly

Clean

Page 9: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 9

Walmart U.S.’s Project Impact strengthens the business foundation

• Project Impact

• Field structure – One Team

• Comparisons

Save Money. Live Better.

WinPlay

Show

Customer

FastFriendly

Clean

Page 10: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 10

Sam’s Club continues to focus on core initiatives

Member Relationships

Efficient & Engaging

Experience

Fewer, Bigger, Better

Superior Value

& Growth

Best Choices

Savings Made Simple

Page 11: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 11

Sam’s Club’s

• Closed 10 underperforming clubs

• Upgraded & outsourced in-club demos

• Improving merchandise assortment

• Aligned Sam’s home office

• Eliminated club membership sales positions

Page 12: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 12

Walmart International prioritizes growth• Click to edit Master text styles

– Second level• Third level

– Fourth level» Fifth level

Smart growth

by winning locally

Balancing growth and return

by optimizing our portfolio

Increasing profitability

by leveraging globally

Page 13: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 13

2006: $308.9 Billion 2010: $405.0 Billion

Walmart U.S. 63.8% International 24.7% Sam’s 11.5%

Walmart U.S. 67.9% International 19.2% Sam’s 12.9%

Walmart US Walmart Int’l Sam’s

Net Sales for Fiscal Year ended Jan. 31,

International growth has outpaced the rest of the company

Page 14: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 14

Walmart’s many opportunities for growth and leverageWalmart U.S. U.K. Mexico

Brazil ChinaCanada

C. America

Sam’s

Argentina

Japan

Chile India

Page 15: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 15

International leverage team takes on new roles

Operations Supply ChainSupplier

DevelopmentMerchandise Development Marketing Integration

Traditional functional roles & centralized support

New International leverage team

Integration Innovation & Process Purchase Leverage

Page 16: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 16

Leveraging Scale and Expertise

• Process consistency

• Global brand relationships

• Global supplier relationships

• Price communications

• Merchandising

• Sustainable thinking

• Integration

Walmart increases profitability by leveraging globally

Page 18: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 18

Total International Units: 4,068

Canada317 Units

China283 Units

United Kingdom 371 Units

Japan371 Units

India1 Unit

Mexico1,472 Units

Brazil 436 Units

Argentina44 Units

Central America 519 Units

Chile 254 Units

As of March 31, 2010

Walmart International currently has 4,068 units in 14 countries

Page 19: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 19

Asda press release

Page 20: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT20

Andy Bond, Asda,President and CEO

Page 21: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 21

• Strong performance over the last four years

• Clear and confident strategy for future growth

• Significant potential for global leverage

• Depth of leadership talent

Key takeaways

Page 22: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 22

Andy Clarke

Chief Operating Officer

Darren Blackhurst

Chief Merchandising Officer

Chet Kuchinad

Executive People Director

Doug Gurr

Executive Development Director

Andrew Moore

George Executive Managing Director

Andy Bond

President and CEO

Judith McKenna

Chief Financial Officer

Rick Bendel

Chief Marketing Officer

Nick Scrase

IPL Managing Director

Jon Wragg

Commercial Director

The Asda Management Team

Page 23: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 23

Session 1• Asda and market context• Successful last four years• Today• Future growth

Break

Session 2• George• Leveraging globally• Q&A

Agenda

Page 24: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT24

Asda and Market Context

Judith McKenna, Asda,Chief Financial Officer

Page 25: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 25

Notes:(1) As at 15th April 2010(2) As per Wal-mart Stores, Inc. 10K(3) Kantar (formerly TNS) Worldpanel, 52 weeks ended 27th Dec 2009, share of Grocer market

• 374 stores & 23 DCs

• 2009 sales - £19.9bn / $31.2bn

• 18.3m customers

• 17.1% market share

• ~170k colleagues

1

1

2

3

3

Asda – Business overview

Page 26: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 26

Asda – Sales mix

Food, 61%

Clothing, 7%

Home & Leisure, 9%

H&B/Non Ed, 15%

Fuel, 8%

Asda sales mix (2009)

Source: Asda

Page 27: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 27

2002 2006 2009

Supercentres

Superstores

Supercentres

Superstores

Supermarkets

George HS

Essentials

Av. 46k sq. ft.

Av. 17k sq. ft.

Av. 28k sq. ft.

Av. 85k sq. ft.

Living

296296

2222

2424

2929

Asda – Evolution of store formats

Page 28: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 28* 3 supermarkets opened in Q1 2010

500,000 sq. ft.(inc extensions)

5 new superstores

5 new supermarkets *

Up to 5 new Living

Asda – New space 2010

Page 29: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 29

Channels and services sales have quadrupled since 2006

• Grocery Home Shopping

• Asda direct / George.com

• Collect In-store

• Take Home Today

• Financial Services

• Asda Mobile

Asda – Channels

Page 30: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 30Source: Kantar Worldpanel (formerly TNS), UK Grocery Market Share, 52 weeks to 27th Dec 2009

UK Grocery market share (2009)

Others

UK Food retail market context

Page 31: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 31

GDP (Growth) Interest Rates (%)

Unemployment (%)

Average Pay Growth

Inflation (CPI %) UK Budget Deficit

Source: Economist Intelligence Unit

2006 2007 2008 2009 2010c

2006 2007 2008 2009 2010c

UKUS

2006 2007 2008 2009 2010c

UK

US

2006 2007 2008 2009 2010c

UKUS

2006 2007 2008 2009 2010c

UKUS

2006 2007 2008 2009 2010c

UKUS

0%

0%0%

0%0% £0m

UK Economic context

Page 32: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 32

Year on year change in monthly ASDA income tracker

Significant pressure on consumers

Page 33: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 33

Political uncertainty

General Election: 6th May

Page 34: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 34

0%

2%

4%

6%

8%

10%

12%

14%

Quarterly food inflation

Feb2007

Feb2010

Source: Office for National Statistics

July 07 Aug 08 Nov 09

Inflation has come out of the system

Page 35: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 35

Q4 2009 Q1 2010

Source: Kantar Worldpanel (formerly TNS), 12 weeks to 27th Dec 09 and 21st March 2010, multiples total till roll growth (VAT adjustment estimated +0.7% Q4, -1% Q1)

+6.1%

+2.7%

Market growth (VAT adjusted)

A tougher market in 2010

Page 36: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 36

• UK market highly competitive

• Market has slowed in Q1

• Consumer confidence fragile – cost of living primary concern

• We remain cautious about the economic outlook

• Asda is well positioned to succeed

Asda is well positioned to succeed

Page 37: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT37

Successful last four years

Andy Bond, Asda,President and CEO

Page 38: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 38

2010200820072006

Operational Improvement

Customer Differentiation

Building blocks for future growth

Three Horizons – successfully completed

Page 39: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 39

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

Jun-06 Sep-06 Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09

YoY

Gro

wth

%

Total Market

Source: Kantar Worldpanel (formerly TNS) Total Till Roll Sales; 12wks ended 27th December 2009

Asda growth vs. market (2006-09)

2006-2009 consistently outperformed the market…

Page 40: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 40Source: Kantar Worldpanel (formerly TNS), UK Grocery Market Share, 52 weeks to 31st Dec 2006 versus 52 weeks to 27th Dec 2009

+0.6%

-0.6%

+0.6%

0%

17.1% 11.7% 16.1% 30.6%Market Share 09

Change in market share (2006-2009)

…and our key competitors

Page 41: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 41

Customer“Britain’s favourite”

Operating Model“Britain’s lowest

cost to operate supermarket”

Colleague“Great place to

work”

Shareholder“Profitablegrowth with

increased ROI”

A simple, consistent winning strategy

Page 42: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 42Source: Kantar Worldpanel (formerly TNS), 52 weeks ending 27th Dec 09

CustomerCustomer

Over 2.5m more Asda customers

2005 2009

15.7

16.3

16.9

17.7

18.3

Winning through a clear customer proposition

Page 43: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 43

CustomerCustomer

Source: Asda internal analysis, rolling 52 week average price gap

2006 2009

Asda price gap vs. market (2006-09)

+2%

6%

5%

4%

3%

2%

Delivering consistent low prices…

Page 44: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 44

CustomerCustomer

externally verified…

Page 45: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 45

CustomerCustomer

TV campaignPress

…and well communicated

Page 46: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 46

CustomerCustomer

Broadening appeal through quality and range

Page 47: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 47Source: Kantar Worldpanel (formerly TNS), 52 weeks to 27th Dec 09

Asda customer demographic (2009)

ABC1 – >50% of growth over

last 2 years

Appealing to a wider demographic

Page 48: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 48

Customer“Britain’s favourite”

Operating Model“Britain’s lowest

cost to operate supermarket”

Colleague“Great place to

work”

Shareholder“Profitablegrowth with

increased ROI”

A simple, consistent winning strategy

Page 49: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 49

Op Model

Buy forLess

Sell forLess

GrowSales

Operate forLess

EDLC enables EDLP – lowest cost to operate

Page 50: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 50

Op Model

2009200820072006

Source: Asda

500

400

300

200

100

£m

Asda “We Operate for Less” Programme (2006 - 2009)

£450m of cost savings since 2006

Page 51: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 51

Op Model

Better for environment

Better for EDLC

Better for customers

CO2 Emissions

30%

Carrier bag usage

Own brand packaging

25%

Waste diverted from landfill

Source: Asda, since 2005

>50%

>75%

Sustainability - £40m+ saved and invested in EDLP

Page 52: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 52

Op Model

Product AvailabilityQueuesFriendly &

Helpful Service

No. 1

1. Source: Yougov Last Visit perception data 2009

2. Source: Asda internal measurement

95% <1+1Out of stocks

down 12%

Focus on cost and great customer experience

1 2

2

Page 53: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 53

Customer“Britain’s favourite”

Operating Model“Britain’s lowest

cost to operate supermarket”

Colleague“Great place to

work”

Shareholder“Profitablegrowth with

increased ROI”

A simple, consistent winning strategy

Page 54: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 54

People

Colleague Turnover

AbsenceHighest ever colleague

engagement

Bonus

2007 2008 2009

Source: 1. Asda We’re Listening Survey results

Productivity

Asda - A great place to work

1

Page 55: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 55

Customer“Britain’s favourite”

Operating Model“Britain’s lowest

cost to operate supermarket”

Colleague“Great place to

work”

Shareholder“Profitablegrowth with

increased ROI”

A simple, consistent winning strategy

Page 56: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 56

• Comp sales

• EDLC

• Inventory reduction

• ROI enhancing formats

Asda ROI %

Improving returns

1. ROI is based on continuing operations

1

Page 57: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 57

Shareholder

Significant development in format and channels

Page 58: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT58

Today

Andy Bond, Asda,President and CEO

Page 59: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 59

YoY Sales Growth – March 2010

Source: Kantar Worldpanel (formerly TNS), total till roll, 4 weeks ended 21st March

+2.6%

+7.0%

+2.9%

+5.8%

+2.7%

Market

Recent trading not up to our high standards

Page 60: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 60

Recent trading has been challenging

• Below our high standards• Journey to EDLP• More work to do to sharpen up in store• Confident in plan

Market

Asda

• Inflation out of system• Disposable income down

Page 61: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT61

Future growth

Andy Bond, Asda,President and CEO

Page 62: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 62

• Great few years

• Time for a new chapter

• Protect and grow core business

• Britain’s favourite retailer across more channels

• Two clear aspirations - next five years• Clear No. 2 in Food• Clear No. 1 in Non Food

The New Chapter – Strategic goals

Page 63: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 63

Comp >Comp >MarketMarket

100 100 SuperSuper

marketsmarkets

New core New core storestoregrowthgrowth

150150LivingsLivings

BritainBritain’’s s FavouriteFavouriteRetailer Retailer across across moremore

channelschannels

No. 2 No. 2 FoodFood

No. 1 No. 1 Non FoodNon Food

World World class class

dotcomdotcom

Global leverageGlobal leverage

The stepping stones to our long-term goals

Page 64: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 64

Renewing our customer promise

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NYSE: WMT 65

Comp >Comp >MarketMarket

100 100 SuperSuper

marketsmarkets

New core New core storestoregrowthgrowth

150150LivingsLivings

BritainBritain’’s s FavouriteFavouriteRetailer Retailer across across moremore

channelschannels

No. 2 No. 2 FoodFood

No. 1 No. 1 Non FoodNon Food

World World class class

dotcomdotcom

Global leverageGlobal leverage

The opportunity – Formats and channels

Page 66: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT66

The New Chapter – Format Development

Andy Clarke, Asda,Chief Operating Officer

Page 67: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 67

Within 5 Years2002 2006 2009

Supercentres

Superstores

Supercentres

Superstores

Supermarkets

George HS

Essentials

Av. 46k sq.ft

Av. 17k sq,ft

Av. 28k sq.ft

Av. 85k sq.ft

Living

296296

2222

2424

2929

150150

100100Supermarkets

Living

Format development

Page 68: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 68

• Only 70% of UK in ASDA drive time

• Zoning framework challenging

• New stores openings successful

• Solid pipeline of openings

Core stores

Page 69: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 69

• Stores for the local community•Local/Ethnic•Halal Meat counters•Pharmacy•Galleria – with Walmart

• Construction costs down 12%

• Extension via mezzanines

Core stores – store initiatives

1. since 2006

1

Page 70: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 70

• Asda Essentials launched in 2006

• Private brand only

• Customers desired full weekly shop

• Proven supermarkets model

• Full product offer

• Aspiration to have 100 supermarkets

Supermarkets – origins

1. 8,000 – 25,000 sq. ft.

1

Page 71: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 71

Supermarkets – The Customer Offer - Price & Range!

Page 72: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 72

• A profitable model

• Prices same as chain

• Optimise category mix

• Obsessed with waste and markdowns

• Flow of goods – improved process

• Non-value added task removal

• Distinctive service

Supermarkets - Operating model

Page 73: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 73

Supermarkets - Pontefract before and after

Page 74: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 74

• GM standalone opportunity

• Currently 24 Livings

• Model evolved since 2004

• 2009 – paused for breath

• Proven successful model

• Aspiration to have 150 Livings

Living – origins

Page 75: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 75

MumsKids under 12

Play

Clothe

Nurture

Home

Service

Relax

Seasonal

Seasonal

Living – Customer proposition

Page 76: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 76

• Optimise category mix

• Opening/Build costs reduced by 1/3

• New management structure and driving lower shrink, waste and inventory

• Strong ROI

Living – Operating model

Page 77: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 77

Living – Switching the store layout

Page 78: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 78

Strong ROI across all formats

ROI by Asda format

Source: Asda model

Supercentre Supermarket Superstore Living

Page 79: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 79

• Confidence to drive new and existing formats

• Supermarket and Living formats to drive future growth

• Maintain focus on enhancing ROI

Key takeaways

Page 80: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT80

The New Chapter – Winning Digitally

Doug Gurr, Asda,Executive Development Director

Page 81: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 81

Food market future growth

Non-food market future growth

Top 4 Share76%

Top 4 Share19%

Source: Asda internal analysis

New space 30%

Comp

50%

Online 20%

Online 100%

The online potential

Page 82: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 82

Price Social Media

ChoiceTrust

great value for money

happy purchase

compact but does the job!

nice but small

worst ever purchase

The evolving customer

Page 83: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 83

Buying scale

Lowest cost to operate

Traffic

Asda personality

GLO

BA

L LOC

AL

Winning online

Page 85: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 85

Over £500 million

turnover*

• 4500 colleagues• 1100 vans

• 165 stores• 1 home shopping centre

40% YOY growth

*Source: Asda, rolling 52week basis

Food Home Shopping

Page 86: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 86

Customer satisfaction

1. Asda customer research

94%1

Page 87: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 87

Page 89: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 89

Source: Asda

Launched nationwide in the last 12 months

In-store collection

Page 90: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

Take home today

Page 91: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 91

• Digital is a key growth channel in all categories

• Success is all about reducing degrees of friction for the customer

• We are well placed and very confident about being a multi-channel winner

Key takeaways

Page 92: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT92

Andy Bond, Asda,President and CEO

Page 93: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT93

Break

Page 94: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT94

Andy Bond, Asda,President and CEO

Page 95: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 95

George – a case study

Page 96: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT96

Andrew Moore, Asda,Executive Managing Director, George clothing

Page 97: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 97

The Inputs

ProductAvailabilityConversionTeamwork

Focusing on the Basics

Page 98: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 98

• Growth• Higher market share• Higher conversion

• Returns• Lower inventory

• Leverage• Lower costs

The Outputs

Focusing on the Basics

Page 99: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 99Source: Kantar Worldpanel (formerly TNS), Volume Share - Total Market , 52w/e data to 28th Feb 2010

2006 2010

52w/e Total Market – George Volume Share %

Page 100: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 100Source: Asda internal analysis, Conversion 52 wk ave.

2008 2010

14.4%

14.2%

14.0%

13.8%

13.6%

13.4%

13.2%

Weekly conversion of Asda customers shopping George

Page 101: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 101

Comp >Comp >MarketMarket

100 100 SuperSuper

marketsmarkets

New core New core storestoregrowthgrowth

150150LivingsLivings

BritainBritain’’s s FavouriteFavouriteRetailer Retailer across across moremore

channelschannels

No. 2 No. 2 FoodFood

No. 1 No. 1 Non FoodNon Food

World World class class

dotcomdotcom

Global leverageGlobal leverage

The New Chapter - George

Page 102: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 102

Comp growth - Customer pledges

Page 103: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 103

• First price is right price

• 90% of range below £10

• Clear good, better, best principles

• Lower promotional spend

Page 104: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 104

• Sourcing is key enabler

• EDLC drives EDLP

• Focus on raw materials

• Increase in direct sourcing

Sourcing

Page 105: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 105

• Professional supply base– Leveraging Walmart buying power

• Demanding standards

• Upgraded specifications

• 100 day guarantee

Page 106: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 106

• Customer focused, mono brand

• New trends with authority

• Innovation

• Speed to market

Style

Page 107: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 107

• New systems

• Size profiling

• New regional distribution network

• Academy

Page 108: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 108

• Core new stores – George as traffic driver

• George dot com

• Living stores – George 50% of sales

• Global

The New Chapter

Page 109: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 109

• UK online clothing & footwear worth over £4.2 billion

• Launched October 2008

• Largest store x 2+

• New range opportunities

• Goal - 10% of sales by 2013

George Dot Com

Page 110: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 110

• Retail Park format

• George a major footfall driver

• Customer profile – mums & kids

• New range opportunities

Living

Page 111: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 111

• George currently in 7 countries

• Leverage opportunities

• George as a GMC

• Process overhaul

• Brand integrity

Global

Page 112: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 112

• Strong growth story over last 18 months

• Drive sales through new products and new channels

• Leverage for lower cost

Key takeaways

Page 113: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT113

Leveraging globally

Andy Bond, Asda,President and CEO

Page 114: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT114

Leveraging Globally – Sourcing

Jon Wragg, Asda,Commercial Director – Merchandising & Sourcing

Page 115: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 115

Manufacturer Middlemen Retailer

Brands

Product development

Supply Chain management

Manufacturer Retailer

INDIRECT

DIRECT

Lowest Cost

Increased Control

Differentiated Product

Global Supply Chain dynamics

Page 116: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 116

Asda Home & Leisure direct sourcing participation %

2007 2008 2009 2013

Source: Asda

15% 16%22%

>40%

Direct sourcing opportunity

Page 117: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 117

Maximising Walmart leverage

Meeting specific local needs

Extending reach – new geographies/categories

Global Merchandising Centres

ASDADirect Sourcing Team

Li & Fung Global Partnership

Routes to increased Direct Sourcing

Page 118: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 118

Level of Complexity

Global Brands

Global Products

Global Suppliers

Raw Materials

Leverage and Standardization

GMCs - Maximising Walmart leverage

Page 119: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 119

Global Sourcing Productivity Loop

Page 120: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 120

Location of GMCs and Sourcing Hubs

GM Sourcing Hub Food Sourcing HubGMC

Emerging Consumer GMC

ApparelGMC

GeorgeGMCIPL

Home, HHL GMC, Food GMC, Packaged Goods GMC and GIC

Page 121: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 121

…..through country dedicated sourcing teams in China

Meeting Local Needs

Page 122: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 122

...through the Global breadth of Li & Fung

Consumer Research

and Strategy Product Development

Product Specs Supplier

MatrixProduction

Execution

Cost Negotiation

PO Tracking & Execution

Logistics / TransportationLab Testing

Order Fulfillment

Assortment Development

Quality Control

Assortment Definition

Seasonal Strategy

Sampling

Design

Extended Reach...

Page 123: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 123

• Direct sourcing – removing middlemen – a key opportunity

• GMCs will increase Walmart capability in product development and in supply chain management

• The global partnership with Li & Fung gives us the opportunity to move at greater pace in new unfamiliar markets

• Global sourcing helps drive the Walmart productivity loop

Key takeaways

Page 124: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT124

Leveraging Globally – International Produce Limited (IPL)

Nick Scrase, IPL Managing Director

Page 125: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 125

• Formed in 2004

• Wholly-owned subsidiary of Asda / Walmart since 2009

• Key activity imported fruit and vegetables

• Recently extended to chilled items

• Global reach – country offices

International Produce Limited

Page 126: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 126

RDC StoreGrower Pre-Packer

IPL business model

Supplier/Packer

RDC

StoreGrower

Pre-Packer

Agent Exporter

Agent Importer

Page 127: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 127

• Control the supply chain

• Improve freshness and quality

• Develop grower / manufacturer relationships

• Develop customer advantage through points of difference

Rem

ove

Mar

gin ta

kers

Leverage scale

Consolidate volumes

and activities

IPL business model

Rem

ove

Mar

gin ta

kers

Leverage scale

Consolidate volumes

and activities

Rem

ove

Mar

gin ta

kers

Leverage scale

Consolidate volumes

and activities

Rem

ove

Mar

gin ta

kers

Leverage scale

Consolidate volumes

and activities

Page 128: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 128

IPL

IPL as a GMC

Page 129: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 129

• Millennium development goals

• Carbon reduction• Education programmes

in Kenya/South Africa• Emerging black farmers• Understanding the

impact Walmart can make

Stellenbosch University, South Africa

Sustainable Business Model

Page 130: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 130

New ProductAreas

Extending IPLprinciples

Serving Walmartglobally

IPL - potential

Page 131: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 131

IPL – key takeaways

• Model has been proven

• Infrastructure in place

• Opportunity to triple our business in 5 years

Page 132: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT132

Leveraging Globally International Marketing Centre of Excellence

Rick Bendel, Asda,International Chief Marketing Officer

Page 133: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 133

• Launched June 2009

International Marketing Centre Of Excellence

Talent developmentTalent development AcademyAcademy

Best practice sharingBest practice sharing Price communicationPrice communication

Thought leadershipThought leadership Differentiation through customer insight Differentiation through customer insight

Global process leverage Global process leverage

Price checkingPrice perceptionPrice checkingPrice perception

Page 134: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 134

1. TV – UK & USA

2. Integrated price marketing campaign – UK & Mexico

3. Store as a marketing medium – UK & India

3 Examples

Page 135: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 135

EDLC = EDLP

1. TV - UK

Page 136: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 136

1. TV - USA

EDLC = EDLP

Page 137: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 137

TVIN-STORE

ONLINE PRESS

2. Integrated Marketing Campaign - UK

Page 138: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 138

mysupermarket - online

Page 139: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 139

TV - UK

Page 140: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 140

Press - UK

Page 141: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 141

Press - UK

Page 142: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 142

Digital - UK

Page 143: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 143

POS - UK

Page 144: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 144

Integrated campaign - Mexico

Page 145: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 145

TV - Mexico

Page 146: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 147

External signs - Mexico

Page 147: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

NYSE: WMT 148

In-store POS - Mexico

Page 148: Session 1 - Walmart...NYSE: WMT 28 * 3 supermarkets opened in Q1 2010 500,000 sq. ft. (inc extensions) 5 new superstores 5 new supermarkets * Up to 5 new Living Asda – New space

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Checkout - Mexico

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3. In-store as a medium

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POS aisle

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POS navigation and value

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• Numerous messages • Numerous colours• No value cut though on ends

India – Before in-store value overhaul

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• 2 clear colours for value• Clear price points on end

India – After in-store value overhaul

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Key takeaways

• Leverage best practices globally

• Improved innovation and processes

• Strengthened price communication worldwide

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Increasing Profitability by Leveraging Globally

Andy Bond, Asda,President and CEO

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• Strong performance over the last four years

• Clear and confident strategy for future growth

• Significant potential for global leverage

• Depth of leadership talent

Key takeaways

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Q&A

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The final words

GrowthGrowth

LeverageLeverage

ReturnsReturns