Store Siting

Photo of Wal-Mart store in Florida

As we grow, we want to ensure that we do so in a way that is in tandem with the needs of our customers and communities. We want to work harder to ensure that our real estate process looks at both the quantity and quality of the stores we are developing and takes into account the desires of the community.

We have taken some initial steps to work with communities and non-governmental organizations (NGOs) to improve how we site stores. For instance, in Ionia, Mich., we worked with members of the community and the National Trust for Historic Preservation to protect a barn that was on a store property. We built around the barn, and then worked to help find an alternative use for it. In the summer of 2007, it was determined that the barn will be relocated and retrofitted for camp activities. We donated the structure and are helping to finance the cost of its relocation.

Still, we know that we need a formalized plan in place that takes into consideration all the environmental, historical and economic factors of areas where we locate our stores, and it is our intention to create one.

On the environmental front, we are working with NGOs and experts in the field to better understand how we can minimize the unintended consequences associated with land development, including storm water runoff, soil disruption, preservation of historic sites and loss of biodiversity.

To help offset our land footprint, we have forged a partnership with the National Fish and Wildlife Foundation to develop the “Acres for America” program. Through Acres for America, which was launched in April 2005, we have committed $35 million to permanently conserve at least one acre of critical wildlife habitat for every acre that we currently occupy and every acre we develop through 2015. As of June 2007, Acres for America has permanently conserved 395,000 acres. In addition, the partnership has land preserved in Arizona, Arkansas, California, Idaho, Louisiana, Maine, Michigan and Oregon. Recently, we announced that grants will permanently protect land along the Big River and Salmon Creek tracts in Northern California, the Yellow River in Florida and in the Prairie Pothole Region of North and South Dakota. It is one of the largest public-private partnerships of its kind and marks the first time that a company has tied its footprint to land conservation. Based on the success of the U.S. program, we are exploring the possibility of doing the same for our international footprint. It is important to note that while this program helps to offset our land footprint, we do not view it as a substitute for considering the environmental impacts of store siting.

We are also working to ensure that we choose locations that will minimize the distance people must travel to reach our stores. This is particularly important in our auto-reliant society. Our latest research indicates that customers must travel two miles or less on average to reach their closest Wal-Mart.

As we plan to develop our business in a particular market, we are challenged to foster economic development and job creation in communities where they are needed most. That’s why in 2006, we announced a Jobs and Opportunity Zone program, where we work with local businesses, suppliers and civic organizations around several of our stores to generate economic opportunity in communities where it is needed most.

We announced in June that we intend to moderate growth of Supercenters in the United States. While this is a business decision, it also provides an opportunity to take a more comprehensive and systemic view of community needs before we build. By more intimately understanding the community where we intend to open a store, we can build the store to reflect the culture of that community – both in design and in the products it carries – while continuing to grow our business.

So perhaps our biggest challenge is to build better relationships and become a more valuable partner in communities before breaking ground. As our business grows and develops, we will be continually challenged to understand and meet the environmental, historical and economic needs of each community where we plan to build our business – whether that community is around the corner or around the globe.

Brownfields and Once-Occupied Properties

Selecting “brownfield” sites for stores is another way that we can be a leader in responsible land development. Not only is this approach more sustainable for the environment, but from an economic perspective, it is good for our communities. We define a brownfield as any property that requires more than $250,000 of remediation. Typically, they are former industrial sites that are vacant and are accompanied by a host of environmental problems.

In 2006, we built and opened four stores on brownfield sites. Today, we are working to refine our brownfield strategy from an approach that initially proved to be too aggressive, to an approach that is more realistic for our business. Brownfield development can be good for our business and improve our ability to grow, but we need to make sure we do it in a way that is both sustainable and in line with our competitive needs.

In addition to brownfield development, we are also working to ensure that when we relocate a store, the former site is redeveloped for the community. For communities to accept new or expanded Wal-Mart stores, we know that we must be successful in finding new uses for former properties. To address this need, our real estate division aggressively pursues new tenants and works hard to ensure that new tenants will meet the needs of the community.

In the past five years the real estate division, working with local officials, real estate brokers, and other real estate professionals, has been able to reduce the number of vacant stores and available square footage. Buildings are often sold or leased for new uses before Wal-Mart has even relocated its operation.