Small Town Getting Big Retailer

NORTHWEST ARKANSAS — Walmart is building a small-format store in Gentry.

Dirt work is under way on Arkansas 59, near the town’s busy intersection of South Gentry Boulevard and South Collins Avenue.

David McNair, Gentry building inspector, said site work is all that has been approved, but preliminary plans call for a 15,000-square-foot retail building. He said no timeline has been set for the building to go through the planning process.

Gentry resident Kristi Hale does most of her grocery shopping at the Walmart supercenter in Siloam Springs and is hoping she can switch those trips to the new local store.

“With gas prices going up so much I’m hoping I can do my shopping close to home,” she said.

Walmart spokesman Steven Restivo confirmed Gentry is getting a store, but refused additional comment.

At 15,000 square feet, the Gentry store only fits the Marketside format, a 15,000-square-foot grocery store prototype. Only four Marketside stores exist, all in the Phoenix area. The first Marketside opened in 2008.

Another format was introduced Tuesday during Walmart’s earnings release.

Bill Simon, president and chief executive officer of Walmart U.S., said the first Walmart Express stores will open in the second quarter, which runs from May 1 to July 31.

Walmart spokesman Greg Rossiter said the company will open 30 to 40 small- and medium-format stores in rural and urban markets this year. Half the stores will be Neighborhood Markets, half small-format stores.

This would not be the first time Walmart has stayed close to home to test a new format. The first discount store opened in Rogers in 1962 and the retailer started Neighborhood Markets in Bentonville in 1998. Walmart on Campus, which the retailer has billed as a one-of-a-kind store, opened in January on the University of Arkansas campus.

Walmart store sizes vary from the 42,000-square-foot Neighborhood Markets to the 185,000-square-foot supercenters.

The 15,000-square-foot size is comparable to Walgreens, which average 14,000 square feet. The average Dollar General is 7,500 square feet in strip centers or 9,500 square feet as stand-alone buildings.

Dollar stores have been a major competitor for Walmart. Gentry, with just more than 3,100 residents, has a Dollar General.

“(Dollar) stores are situated to get in and get out, and the product selection is not overwhelming walking from aisle to aisle,” UBS analyst Neil Currie wrote in a research note.

He said Walmart’s new, smaller format should be a combination food and drug store of about 20,000 square feet, carrying half the items of a Neighborhood Market. The average Neighborhood Market sells about 29,000 items.

More dollar stores will be added nationally this year, with more than 1,000 slated to open in the next 12 months, J.P. Morgan analyst Charles Grom said.

The baby-boomer generation is also present on the minds of every retailer in the country, according to Thomas Jensen, chairman of the marketing department at the University of Arkansas.

He said 10,000 boomers a day will turn 65 over the next 18 years prompting retailers to shift their focus toward these 78 million people.

“Walmart’s new smaller store format will cater to convenience shopping in part because that’s what boomers want,” Jensen said. “This is a way for Walmart to compete better with the dollar stores that are returning some good numbers these days.”

Kevin Cryer of Gentry worries what the Walmart store will mean to business at other local stores, including Dollar General.

“I’m 50-50 about it,” he said. “I love to shop at the local stores, but you have to go where you can afford.”

He said he picks up some items at the local Marvin’s grocery store and the Dollar General, but does most of his grocery shopping at the Siloam Springs Walmart.

The Gentry store won’t increase how much he spends at Walmart, just where he spends it.

“It will be nice to keep those tax dollars local,” he said.

Kim Souza contributed to this report.