Wal-Mart Stores may be moving its apparel-buying operations back to the company's headquarters in Bentonville, Arkansas, only a year and a half after consolidating them to New York, according to a source who wished to remain anonymous.
The decision to move to New York, announced in February 2009, was a painful one for employees. Some 700 to 800 workers at Wal-Mart's corporate headquarters were terminated as a result and the decision to move back may produce more casualties in New York this time.
The move back to Arkansas may also anger some apparel vendors. Business Week reported last year that apparel vendors, like most of Wal-Mart's suppliers, maintained sizable operations near the retail giant's headquarters. If they followed Wal-Mart out of Arkansas last year, they could have to move again, creating extra costs. The Business Week report said there were approximately 100 apparel vendors with offices in Bentonville, Ark.
Wal-Mart wasn't immediately available for comments.
The retailer reported a 3.6 percent increase in second-quarter net income Tuesday and raised its earnings guidance for the full year as it benefits from cost-cutting and robust global growth in China, Brazil and Mexico, the Associated Press reported.
But sales at recently-opened stores in the US are still slow and Wal-Mart has been struggling with following a consistent merchandising strategy.
Wal-Mart's shifting strategies indicated the retailer was "a little bit lost," in navigating the economic downturn, David Strasser, an analyst at Janney Capital Markets, told the New York Times. "They're operating their business, quite frankly, not very well at the moment."