Dive Brief:

• Wal-Mart’s moves to streamline its logistics and clean up its act in stores has the mega-retailer also disappointing its suppliers, reports the Wall Street Journal.

• The company is reducing the number of offerings on shelves for some products — for example, no longer offering six different sizes of the same salad dressing.

• In addition to down-shifting its assortment, the retailer is asking vendors to reduce their prices and get paid in longer time periods while also having them pay less for marketing efforts.

Dive Insight:

Wal-Mart’s U.S. CEO, Greg Foran recently spoke to the Wall Street Journal and demonstrated some of significant changes the retailer is making to meet its new goals. But while some of his criticism of the retailers’ stores’ massive inventory is that it’s “trying to fit four pounds of sugar into a two-pound bag,” some may ask if the retailer also trying to change too much too soon.

It’s clear that something must be done, as Wal-Mart is seeing many of its stores struggling even as the economy improves, at a time when it’s also ramping up its e-commerce and workforce costs.

In fact, one reason for that could be that many customers stop shopping at Wal-Mart once their finances improve, preferring to shop at stores with less of a downmarket feel. Wal-Mart is aiming to increase its market share by appealing to higher income shoppers, something that some experts question. 

“Globally we know growth will disproportionately come from middle- and upper-income households in the years ahead,” Wal-Mart CEO Doug McMillon is quoted as saying in mid-October.

But how does Wal-Mart make such significant changes without damaging its core reputation for great assortment and “always low prices”? And how long will vendors play along if they fail to get exposure and marketing via the shelf signs and Sunday circulars they’ve come to depend on? 

Foran admitted to the Wall Street Journal that it’s a tall order, saying that both customers and employees are “relying on us to get this right,” he says. He could add “investors” to that list as well.