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Chapter 428 Reactions from All Parties

Grand Rapids, Michigan.

It gets its name from its location on both banks of the Rio Grande, where the river flows swiftly.

Thanks to its abundant timber resources, this is one of the largest furniture manufacturing centers in the United States. The headquarters of the world's three largest office furniture manufacturers, Hermann Miller and Hayward, are located here, earning it the reputation of a furniture city.

Besides furniture, Grand Rapids is also famous for its manufacturing and retail industries, and Meijer's headquarters are located here.

In the Meijer headquarters building on Walker Avenue in Walker District, Grom sat in his office, with Quinn sitting opposite him.

At this moment, Grom's face showed obvious anger, and his finger pointed to the messy desk covered with newspapers.

"A bunch of hypocrites, saying one thing to your mouth and another behind your back, saying that e-commerce is the graveyard of retail, but they're all jumping the guns faster than anyone else." Grom's voice was full of dissatisfaction and sarcasm.

When Quinn saw his father's angry expression, he was surprisingly calm, thinking that things were going to develop this way and there was nothing to be surprised about.

Quinn casually picked up a few newspapers from the table, glanced at them briefly, and found that almost all of them were related to Walmart's e-commerce business.

Interestingly, many print media giants don't seem to be very optimistic about Walmart's move into online business.

The Wall Street Journal's business section published a report titled "Retail Giant's Online Probe," claiming that Walmart's e-commerce business is largely just a gimmick launched by management to appease investors.

The implication is that they want to capitalize on the internet boom, increase market attention and stock price performance by venturing into online businesses, and thus deliver a satisfactory market capitalization to investors.

Data from the NYSE provides the best evidence: Walmart's stock price experienced a significant downward trend over the past week, falling by more than 2%, before finally showing signs of recovery in the last two days, with the stock price slowly rebounding.

Amazon's stock price, however, rose by 2% against the trend, which to some extent reflects the different views of market investors on the two companies' prospects in the e-commerce field.

Clearly, in the e-commerce sector, the market still tends to trust Amazon more.

"They simply don't understand e-commerce." This was the interpretation of the two companies' stock prices by an investment fund manager interviewed by The Wall Street Journal.

"Walmart's advantage lies in its supply chain efficiency, but its online business requires data algorithms. Just look at Walmart's shopping website; even a normal loading time is delayed."

At the top of the newspaper, there was a photo of Walmart's e-commerce website homepage, with the slogan "Everyday Low Prices" in red font taking up a third of the screen.

When asked why Walmart's stock had rebounded in the past two days, the fund manager said, "Walmart seems to have realized its mistakes and has made reforms to its e-commerce website, but the market still doesn't have much confidence in it."

"E-commerce does fall under the category of retail, but it should be categorized more under the technology industry, and Walmart knows nothing about technology and the internet."

Besides The Wall Street Journal, The New York Times also expressed skepticism about Walmart's e-commerce strategy.

However, unlike The Wall Street Journal, which focuses on macro-level analysis such as corporate strategy and technological capabilities, The New York Times takes a more down-to-earth approach to reporting.

"According to user feedback we interviewed, a customer placed an order for a can of baby formula at Walmart three days ago, but Walmart sent the wrong size, sending the customer a small box instead."

"Although this error may seem accidental, it has caused great inconvenience to consumers. What makes consumers even more dissatisfied is that when they discovered the problem and called Walmart's customer service to complain, the line was busy for two hours. After answering, the customer service representative claimed that online orders were not under their jurisdiction and went back and forth for a long time before finally resolving the issue."

"Clearly, Walmart's e-commerce hasn't yet found its own operating system, and they still have many problems to solve. But for a giant like Walmart, breaking internal conventions and establishing new rules will hardly yield results in the short term."

"Walmart, as a traditional retailer with a large organizational structure and a long history, has established a relatively fixed operating model and corporate culture. To promote the development of e-commerce within such an enterprise, break the traditional mindset and operating system, and establish a new set of rules and systems that adapt to the needs of e-commerce development, undoubtedly requires a huge amount of effort and time."

However, some are optimistic about Walmart becoming the winner in e-commerce. BusinessWeek believes that Walmart has advantages that Amazon does not: one is its complete range of products, and the other is the supply chain and logistics system that Walmart relies on and is proud of.

"Currently, there isn't an e-commerce company on the market with such a comprehensive range of products. Since consumers choose to shop online, they can't possibly only need a single item. If they're going to buy something anyway, why not buy everything at once?"

Quinn put down his newspaper, and an article from a local Michigan print media caught his eye.

The above was a reprint of an article published in the West Coast News. After reading it, Quinn's expression changed slightly, and he looked up at Grom, asking, "Have you seen this newspaper?"

Grom followed Quinn's gaze to the local newspaper, then shook his head. "Not yet. Is there anything important in it?"

Quinn picked up the newspaper again and read aloud the article: "According to Ernst Asset Management's e-commerce market forecast, the total online retail sales in the US e-commerce market in 1998 are likely to exceed $70 billion."

"That's impossible," Grom retorted directly. "Amazon's sales forecast for this year is only $800 million to $900 million. According to their forecast, that would only account for about 13% of their total annual sales."

"Who pocketed the remaining sales revenue? Was it Walmart?"

Grom thought it was a huge joke; Walmart had only been online for a few days.

"Don't forget, Ernst Asset Management is owned by someone, and the West Coast News they reprinted is also part of MGM," Quinn reminded him.

"You mean flash sales?" Grom shook his head again.

"Even with the most powerful flash sales, this is impossible. It's already August and almost September, and online sales across the US may not even exceed $15 billion. How can the remaining $55 billion be achieved in the remaining four months?"

"Moreover, the flash sale hasn't even launched yet, and it's unknown when it will be available."

According to Grom's analysis, this forecast is absurd and completely unrealistic.

"But what if that person is Ernst?"

Ernst Asset Management gave such an absurd forecast, and the West Coast News actually chose to publish it. The two things combined make it hard not to wonder if this has nothing to do with Ernst.

Quinn still preferred to believe the other party and the data.

Over the next four months, there will be $55 billion in online retail sales. If Meijer can capture the lion's share, he can achieve further expansion.

He thought of Ernst's suggestion when they parted at the retail conference. He had almost forgotten about it, but now it had suddenly resurfaced.

He looked up at his father and said with a determined look in his eyes, "Give me two hundred million dollars, I want to give it a try."