Wal-Mart Warehouse Clearance, Another Threat to Competition

By Douglas A. McIntyre Updated Jan 12, 11:26AM EST · Published Jun 2, 5:27AM EDT

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Wal-Mart Warehouse Clearance, Another Threat to Competition — © courtesy of Wal-Mart Stores Inc.

Because of the size of Wal-Mart Stores Inc. (NYSE: WMT), its inventories have to be much larger than any other brick-and-mortar retailer in America. When it slashes prices for a national warehouse clearance sale, its competition has reason to be anxious. Wal-Mart just began one of these “events” online, and it has cut prices more than half on some items.

As usual, Wal-Mart further leverages its size and nearly 5,000 locations to attract buyers. Many of the items with sharp price cuts come with free two-day shipping. Many others can be picked up in stores for free.

The clearance includes an unusually broad array of items. These include toys, sports and outdoor items, furniture, home improvement products, patio furniture, auto products, and consumer electronics. Items for summer living are high on the list.

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Most of the items on sale are relatively inexpensive. Wal-Mart is selling a Hunter 52″ Sea Air Textured Ceiling Fan for $77.59, down from its initial price of $165. Wal-Mart also offers a 12-oz bottle of Deter Outdoor Soap for $4.45. However, it is also selling high-end PCs, which include a Sony 11.6″ VAIO Duo Laptop PC with Intel Core i7-3537U Processor, a touch screen, a 256 GB SSD and Windows 8, which has been refurbished, for $670.03.

For some reason Wal-Mart lists a huge number of items that have been sold out. Perhaps it wants potential customers to know that the clearance is really a clearance and time is of the essence.

Wal-Mart’s clearances not alone makes use of the retailer’s huge inventory. Wal-Mart is by most measures the second largest e-commerce company in the United States after Amazon.com Inc. (NASDAQ: AMZN). And it is struggling to gain ground on its rival. Wal-Mart needs any advantage it can get.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.