Walmart offers company stock to make store managers feel like ‘owners’

Walmart offers company stock to make store managers feel like 'owners'

Walmart, the nation’s largest private employer, is boosting pay and benefits for store managers as it looks for ways to retain them.

Walmart said Monday that managers at its U.S. stores will be eligible for grants of up to $20,000 in company stock each year. The stock will vest for a period of three years, with a percentage vesting each quarter.

The announcement comes just weeks after Walmart said it would raise the average pay for store managers from $117,000 to $128,000. The big-box retailer also said bonuses for store managers could reach up to 200 percent of base salary, with store profitability becoming a bigger factor in the calculation.

Store managers are vital in increasing sales and profitability in their stores and keeping morale high in a dynamic business. Managers are also seen as an important pipeline to leadership in the company.

A store manager at a Walmart Supercenter oversees hundreds of employees who work in various departments, including food, apparel, pharmacies and auto centers. These stores often attract large numbers of shoppers and generate millions of dollars in sales each year. At the beginning of the COVID pandemic, store managers were given even more responsibilities as the company adapted to changing consumer behavior, including managing e-commerce capabilities like in-store pickup for online orders and out-of-stocks. As well as navigating the extra stuff involved. store.

“It’s fair to say that we’re asking them to act like bosses and think like bosses,” Walmart US Chief Executive John Furner, who previously was a manager at a company store, said in a call with reporters.

The size of stock grants to managers will be based on the Walmart store format. Store managers at supercenters will be eligible for a maximum of $20,000 per year. For the other two levels of stores, which are often smaller and have fewer departments, managers will be eligible for $10,000 or $15,000 in annual stock grants.

Retailers have looked for ways to retain workers as people moved in and out of jobs during the pandemic in search of higher pay and more opportunities. Until recently, Walmart has focused on increasing wages for store employees. Turnover at Walmart stores has stabilized after 2022 and the company feels good about its staffing levels, Mr. Ferner said.

“The store manager ranks have been more stable over the years,” he said.

He added, “We’re keeping store managers in place a little longer and keeping a manager for a few years versus a year or less is good for the entire team.” “So that’s a good sign.”

Mr. Ferner said Walmart already has a stock purchase program in which the company matches 15 percent of their purchases up to $1,800. But Monday’s announcement goes further than that.

He also said the new program will allow store managers to share in the rewards of growing business and rising stock value. Walmart shares closed at $164.27 on Friday. It has increased by about 43 percent in the last five years.

“If we perform well and the stock price goes up, our management teams, particularly our store managers, will be able to participate,” Mr. Ferner said.

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