Walmart shifts leadership to merge stores and e-commerce operations

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Walmart is reorganizing leadership as it works to integrate its online enterprise with its physical stores, according to a new report.

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A memo sent to Walmart employees from CEO Doug McMillon said that the retailer will combine supply chain teams from its e-commerce site and stores. It will also combine the teams that run the finances for its website and stores, CNBC reported.

“Our customers want one, seamless Walmart experience,” McMillon reportedly wrote in the memo. “Earning more of our customers’ business in food and consumables is foundational to our strategy, and, at the same time, we will expand our ability to serve them with general merchandise in stores and through our broad e-commerce assortment as we continue to invest and build our e-commerce business.”

According to CNBC, Greg Smith — Walmart’s current executive vice president of the U.S. supply chain — will reportedly head the new combined supply chain team while Walmart’s U.S. CFO Michael Dastugue will reportedly take over the combined finance team.

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However, the teams that run merchandising for Walmart’s stores and website will stay separate, the outlet reported.

Regarding the decision to keep those teams separate, McMillion reportedly wrote: “Our eCommerce sales growth, improving customer metrics and progress on contribution profit are encouraging, and we want to keep that going.”

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Walmart has been working to ramp up its e-commerce operations in order to compete with Amazon, but those efforts have had a significant negative impact on the company’s profitability, according to a report earlier this month.

The Arkansas-based retailer’s e-commerce business is set to record a $1 billion loss on revenue of between $21 billion and $22 billion this fiscal year, Vox reported, citing multiple sources familiar with the matter. At least three of Walmart’s recent digital brand acquisitions – Bonobos, ModCloth and Eloquii – remain unprofitable, the report added.

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The division’s profitability issues reportedly drew the ire of McMillon and other top executives at the company, who are said to be pressuring Marc Lore, the Jet.com founder and current Walmart e-commerce chief, to cut down on losses.

Walmart acquired Jet.com for more than $3 billion in 2016.

FOX Business’ Thomas Barrabi contributed to this report.