Walmart

“Walmart for the first 15 years that it was public had negative free cashflow for each of those years. Walmart was profitable on the income statement, but they were investing like crazy.”

“The only larger one being Walmart, which Amazon will almost assuredly pass very soon.”

“They stopped selling handguns in the nineties. And now after the shooting in the store, they don't sell guns to people under 21. In 2015, they stopped selling assault rifles.”

“And this is why, because the family were all partners in Walton Enterprises. They couldn't just sell their stock. The partnership, the family as a whole had to decide to sell, and that allowed them to keep majority control of Walmart all through the history.”

“So like Walmart, I think is now the largest U S commercial producer of solar power.”

“And remember all these managers were equity owners in their own stores and in most cases in the stores of all the other managers too.”

“The first store opened in Washington in 1993 and Amazon was founded in 1994.”

“In my bull case, there's, they kind of should win same-day grocery delivery since they have these super centers everywhere.”

“Ultimately that leads to a couple of things that led to offshoring of American manufacturing. Walmart was a huge contributor.”

“So much of Walmart is trying something, doing an experiment, watching it fail on some small scale, choosing not to roll it out, or watching it succeed, and then choosing to rapidly roll it out across as many stores as possible.”

“Home Depot modeled their employee stock program purchase program after Walmart's, and it's brilliant. It's the same thing. You put up your own money, but you can do it pre-tax dollars out of your paycheck at a 15% discount to the stock price.”

“If you add up two through nine in e-commerce, and Walmart is second place to Amazon, it is still not equivalent to Amazon's total sales in a year. And in fact, I think it's something like two through nine added together are still 50% shy of Amazon's e-commerce…”

“Reading the story is how much Walmart embraced technology and Sam embraced technology, and I think they were arguably the first corporation in America to embrace computing as a business paradigm.”

“So Walmart has over 20% market share of us groceries. Kroger has under 10% and then Albertsons and Costco are tied at five percent each.”

“The Walton family goes on to be the wealthiest family in the world. All of Sam's future generations are worth a few hundred billion dollars, depending on the day that you look at Walmart's market cap, since it's nearly all invested in Walmart, but it's a multi…”

“I didn't realize that Kmart for a very long time was much, much larger than Walmart. They were kind of Walmart's big brother incumbent.”

“Sam and the Walmart story is like the bridge between the business America that was John Rockefeller and Standard Oil and Amazon and Jeff Bezos. Like, this is the connective bridge between those two realities.”

“So most items by and large, on average, across the board, the grocery items in a Walmart super center are 15% cheaper than a comparable grocery store, which if you're like a middle or lower income family, that's hundreds of dollars a month that you're saving, …”

“So, by 1990, Walmart passes Sears to become the largest retailer in America.”

“They did close to six hundred billion dollars of revenue last year. They did twenty-five billion dollars of operating income. That's only about a four percent operating margin for those counting at home.”

“So, they invested twenty-four million dollars to link all stores with a two-way voice and data transmission and a one-way video communication from Bentonville. And basically, there was not enough bandwidth available on any other communication lines.”

“In the last most recent fiscal year, grocery accounted for 55% of Walmart's total revenue, which is over three hundred billion dollars alone just from grocery.”

“If you look at Walmart's twenty-four-ish percent gross margin, so that's basically what they get from the goods that they sell on the shelf, you see, ok, it's less than Target, which makes 29 30% of anything that they sell on the shelf. Well, Costco's gross pr…”

“Hamilton uses Netflix in the book, which is another great example, but this is the single best example of scale economies in the world. They can price lower because they have the power of scale and the distribution and logistics network and the operations that…”

“If we look back, all the way back to, let's see, 1982, They were growing about 40 to 50% a year, and that has basically been on a slow, steady decline all the way until about 20 13, where it's been about flat at three percent since then.”

“There's 10,500 stores. Each week, two hundred and thirty million customers visit one of these stores.”

“It is the largest by revenue in the world, doing nearly six hundred billion dollars a year in sales.”

“Walmart bought 77%, I think, stake in Flipkart back in I think it was 2018 for over sixteen billion dollars”

“Today, 90% of America lives within 10 miles of a Walmart, but there are three places where that is not true, and a fourth kind of where it's technically true but not in spirit.”

“I actually think this is super brilliant. I was thinking about this with regard to tech companies today and everything. And like, even though employees of tech companies get much better economic deals with stock options, I think psychologically, this is a bett…”

“By like 1967 ish Kmart has 250 stores all across the country doing eight hundred million dollars in sales. And the new Walmart concept, Walmart revenue was still only around ten million dollars at that point in time”

“It is the world's largest employer, other than public entities like governments employing nearly 2.3 million people around the world.”

“Only about 13% of Walmart's revenue comes from e-commerce. Now, that's seventy-five billion dollars.”

“It is still controlled by the Walton family, who owns just over 50% of the business a full 60 years after it was founded.”

“Walmart probably has a gross margin between 20 and 24% at any given time, and every store had like a 33% gross margin. Even the, like, Target is sort of like a high-end discounter. It's sort of like a nicer stuff, more expensive. They're in the 29% category, b…”

“And I thought like, oh, well, duh, Amazon killed them all. No, Walmart killed them. There's no way that Kmart or God forbid Sears at that point could compete against Walmart.”

“It's that insight that people far out from cities want the same thing as people in cities, and so they're just as bright, they want the same things in life, they just happen to not live in cities, and so let's not be pejorative, let's serve them with high qual…”

“If you look at the gap that Amazon closed in total revenue since the time they were founded to Walmart, they're going to catch them. No doubt about it.”

“If you're gonna compete on price, you must avoid buying anyone else's inefficiency at all costs, and it means having often very contentious relationships with your suppliers.”

“So Walmart's compound annual revenue growth rate for the whole decade of the 19 seventies was 40.1%, four 0.1% for the whole decade. And then in the 19 eighties, it was 32.4%.”

“Each store was actually its own company, so that different people could sort of hold shares in each store. The management, different people who, you know, wanted to invest in the store, that sort of thing.”

“At this point, they had been the largest computerized logistics distribution company in the world and operated their own private satellite network to communicate amongst all their stores and had been doing that for a dozen years.”

“They even go pitch the idea to Walmart to do the same thing with Walmart. Walmart is they're like, Yeah. No, thanks guys. No, nice try.”

“There's counter-positioning in the era that we're talking about, Barnes & Noble, and subsequently Walmart, because those folks would have to invest so much and did, well Walmart did at least, to completely reinvent the way that they do distribution and all the…”

“In late 1998, Walmart sues Amazon for trying to steal trade secrets. The case settles with no damages, but there was damage. It happened. That DNA came right out of Walmart and right into Amazon.”

“Linkovitz first project is doing the satellite communication system. For Walmart.”

“I still think that they were the first applied technology company in America.”

“Walmart was really the company that single-handedly created the wave of the modern store period, which then Amazon could take digital.”

“So for example, Walmart, Isn't in our marketplace because they're Walmart, they have an incredible brand, et cetera, but they use our fulfillment services”

“So, Walmart's revenue today is about three times Costco in the US.”

“Costco's average hourly wage is 26 dollars, and Walmart's is nineteen-fifty.”

“The average revenue per product, because of the SKU count, at Costco is about 10 times Walmart.”

“Costco actually turns their inventory 12.4 times per year. And just for comparison, Walmart turns their inventory eight times per year. Home Depot is more like five times per year.”

“For most if not all of their suppliers, they are by far the biggest buyer of their goods. Even bigger than Walmart, because they have so many fewer SKUs in the store.”

“So at the time, Walmarts and Kmarts had on the order of about 50,000 SKUs and even FedMart had Probably close to that many at the time.”

“And you're the third biggest player in the largest market, you know, America, behind Amazon and Walmart.”

“Target's about 450 dollars per square foot of revenue. Walmart's about 600 dollars. Costco is 1800 dollars per square foot of revenue.”

“There was an independent research firm that found that the typical Costco consumer makes about a 125,000 dollars a year in household income and has a four-year degree. Walmart, by comparison, has a median income of about 80,000 dollars. And keep in mind, the m…”

“92% of Costco's merchandise is cross-stocked. Only 10% of Walmart has cross-stocked merchandise on a pallet system like this.”

“So it offended them to go against the rich suburbs and to have to pay up for the good locations, and Costco just specialized in the good locations where the rich people live. And Walmart just let them do it year after year. It was a terrible mistake.”

“Costco is 1800 dollars a foot. They are trying to maximize their dollar per foot. Walmart is about 600. Target is about 450 dollars. And then these, like, crazy businesses, just to compare it to the all-time greatest, Tiffany is 3000 dollars a foot for jewelry…”

“Trader Joe's today average about, call it 15 thousand-ish, maybe a little less square feet per store. The average supermarket is like 50,000 square feet, and the average Walmart is like a 150,000 square feet.”