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Wal-Mart’s strategy shift comes with 200 e-commerce job cuts

January 25, 2017 03:43 PM
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E-commerce continues to drive change at Wal-Mart Stores Inc., and the most recent restructuring involves the loss of about 200 jobs within its U.S. e-commerce team.

A memo sent Tuesday to Wal-Mart employees from Marc Lore, the retailer’s president and CEO of U.S. e-commerce, informed staff of the cuts. “We’ve made the hard decision to eliminate around 200 positions today. These changes touch teams across the U.S. e-commerce organization,” Lore wrote in the email.

Wal-Mart, based in Bentonville, Ark., houses most of its e-commerce technicians at its @WalmartLabs headquarters in San Bruno, Calif. Online marketplace Jet.com, founded by Lore and now owned by Wal-Mart, is based in New Jersey. Wal-Mart, No. 4 in the Internet Retailer 2016 Top 500 Guide, in August announced it was buying Jet for $3.3 billion and naming Lore head of Wal-Mart’s e-commerce operations.

“As difficult as this decision is, I know it’s the right one,” Lore’s email from Tuesday states. “We have a clear strategy. We’ve structured the team for speed and simplicity. We’re building an organization with the right talent and experience. We’ve created an environment where the best minds across our many locations can team up and drive great ideas forward. And while some roles are going away today, we’ll be investing in our business and adding new skill sets during the year.”

On Jan. 13, Wal-Mart made several leadership changes, tapping more Jet executives as part of its push to focus more on e-commerce and better compete with Amazon.com Inc. (No. 1 in the Top 500). The company said it’s streamlining its web team so that it can serve customers whether they shop online, via smartphones or in stores, according to Lore’s Jan. 13 memo. That memo also said Wal-Mart will create a new team to handle customer issues, returns and fraud prevention—a critical concern as Wal-Mart relies more on third-party merchants selling on its marketplace. Wal-Mart’s marketplace has more than 1,000 sellers and more than 25 million SKUs, up from 8 million SKUs in January 2016, while Jet has more than 20 million SKUs, and both sites are adding products daily.

Key promotions include naming Scott Hilton to the role of chief revenue officer; he’s charged with aligning the company’s online retail operations, marketplaces and digital stores. Meanwhile, Jeremy King, who heads @WalmartLabs, has been promoted to U.S. chief technology officer, bringing together Wal-Mart’s retail and e-commerce technology teams.

It’s been a busy start to 2017 for Wal-Mart. Earlier this month, Sam’s Club CEO Rosalind Brewer announced her retirement, and Wal-Mart said John Furner, chief merchandising officer of the retailer’s warehouse unit, would take over as CEO effective Feb. 1. Also earlier this month, Wal-Mart bought online-only retailer Shoebuy.com to expand Jet’s apparel and footwear selection.

Other changes may still be coming before January ends. Bloomberg News reported earlier this month that hundreds of workers, many in the human resources department, face being cut as Wal-Mart looks to slim down. Wal-Mart employs about 2.3 million people worldwide.

 

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