In 2007 the Wall Street Journal reported that “Walmart is losing its taste for burgers and fries,” by replacing many of the McDonald’s franchises they once had within the stores with Subway restaurants. That was nearly 10 years ago, and now Subways are a common stay inside many Walmart supercenters. However as public approval, appetites, and opinions change toward Subway, Walmart may soon find itself at a crossroads once again.
Even if Walmart hasn’t yet begun considering what new franchise they might want to put into their stores, the answer that they eventually will come up with will probably be a company known to be popular among millennials, like Chipotle or another “fast casual” restaurant. However, fast casual restaurants are beginning to go into decline. For Walmart to introduce one of these chains would simply be to push off the inevitable for another couple of years, before repeating the process again, ad infinitum. Looking for the “safe bet” will only perpetuate this, as the safe bet is probably on the decline due to new health trends or lifestyle changes.
Instead, Walmart needs to think outside the known entity, and not be afraid to try something new, or perhaps, something old.
Walmart, unlike many smaller chains, does not need a brand other than Walmart to bring people in. A Subway within a Walmart is unlikely to bring in customers unless the town doesn’t have another Subway. Instead of just hoping that that never happens, perhaps Walmart should go a new route.
In Bentonville, Arkansas, the town where Walmart has its headquarters, there is a small diner on the corner of Main Street called Spark Café Soda Fountain, owned by Walmart. They sell ice cream treats and drinks in a quaint little shop that looks like it was pulled from the 1950s. This is the exact kind of restaurant that Walmart should put into its stores. By expanding the menu slightly, adding burgers and fries to the menu along with the mini ice cream cones and sundaes they already offer, they could create something new and fun. These “Spark Diners” would be able to fulfill most of the supplies it would need from distributors that Walmart already has relations with; it would simply be a case of sending a little bit more. Small deserts and basic food would be easy to train people to produce and the site could even offer a selection of fruits that are inexpensive. These diners are meant to bring people in but should be kept simple like the Bentonville store.
Public demand for a cheap and fun place to go out, especially amongst young people, has skyrocketed. Generation Z is frugal, and the low prices and sense of romance present in the Americana feel of a classic diner would attract them. It would also bring in Millennials looking for a place to take their young children; the appeal of being able to do their grocery shopping and take their family out for a treat would be great.
Currently, the restaurants in Walmart supercenters seem like afterthoughts, empty spaces pushed into the corner of the store. However, by revamping them into Walmart controlled venues, Walmart would be able to keep all the profits, not have to pay a franchising fee, and attract new, younger customers. It would be a shame to keep the potential that these spaces show from ever being realized, both for the customer, as well as for Walmart.