As part of a larger effort to cut costs through improved efficiencies, Wal-Mart Stores Inc. is testing whether it can centralize invoicing and accounting operations. Instead of having individual U.S. stores handle these tasks, the world’s largest retailer is hoping it can lower payroll costs by cutting in-store office jobs.
Mark Ibbotson, executive vice president for central operations at Walmart U.S. , told the Wall Street Journal in a report Wednesday that about 500 stores, most of them on the U.S. West Coast, will participate in this pilot project.
“We really want to pull our workforce onto the floor,” Ibbotson told the Journal.
Each store has about three employees who are typically paid at a higher hourly rate than most customer-facing workers, like shelvers, greeters and cashiers. Roughly 1,500 workers who handle cash and manage invoices for suppliers that deliver directly to stores will be given the choice of leaving or taking floor jobs. Almost all of them are expected to stay, according to Ibbotson.
Their new jobs could pay less, though; Walmart is offering affected workers who want to remain $17.55 an hour or their current wage, whichever is lower. Earlier this year, the company raised its minimum hourly wage for most store employees to $10 an hour. Walmart employs about 1.4 million workers in the U.S.
The company has spent billions of dollars since 2014 in these pay increases, for streamlining operations and in e-commerce development. Though it earned $14.7 billion in profit last year on $478.6 billion in sales, Walmart has been struggling to meet Wall Street growth expectations.
Same-store sales, a key retail metric that excludes recently opened stores to more accurately compare to past performance, has been sluggish at around 1 percent for seven consecutive quarters.