Next Wal-Mart CEO faces challenges Sam Walton never saw

Online Sales

Another challenge facing a new CEO is how to goose Wal- Mart’s online sales, which account for about $5.15 billion, or 2%, of total annual sales, according to Kantar Retail, a London-based consulting firm.

More and more Wal-Mart customers are shopping at Amazon, according to Kantar. Yet Wal-Mart continues to pour capital into its brick-and-mortar operations. This year it plans to open about 130 supercenters, which Simon called Wal-Mart’s “primary growth vehicle” in an earnings call last month.

Under McMillon, the company has been working to relaunch its “everyday low price” strategy in Brazil and China after struggling to find strong sales growth in both markets. In India, Wal-Mart has faced questions over lobbying.

An Arkansas native, McMillon began his career in a Wal-Mart distribution center, according to the company’s website. He moved through the ranks, working in a variety of merchandising roles in the U.S. division, where he concentrated on food, apparel and general merchandise. Before taking the reins of the international division, McMillon ran Sam’s Clubs from 2006 to 2009.

High Profile

“Doug has been high-profile since his early to mid-30s,” said Brian Yarbrough, an Edward Jones & Co. analyst based in St. Louis. “He’s an up-and-comer. They might be ready to move him into the slot and have him as CEO for the next 15 to 18 years.”

Prior to joining Wal-Mart as executive vice president of professional services in 2006, Simon held roles at the U.S. restaurant company Brinker International Inc., Diageo Plc, the U.K. spirits maker, Cadbury Schweppes, PepsiCo Inc. and RJR Nabisco. He was secretary of the Florida Department of Management Services under then-Governor Jeb Bush. He also served 25 years in the U.S. Navy and Naval Reserves.

“He’s done a good job of turning around U.S. operations,” Yarbrough said. “But it’s not like things are just rolling along. The business remains challenging. The consumer remains under pressure. It’s a slow growth environment. And dollar stores have done a good job.”

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