There are numerous grocery store chains across America where you can go to restock your pantry and fill up your fridge. However, one in particular stands out from the rest, ranking as the largest grocery chain in the nation — and it’s so far ahead of other retailers that it’s practically in a league of its own. Have you guessed the brand yet? Yep, it’s Walmart, the store where you can find fresh baked goods made in-house and a new flat-screen TV.
Despite not technically being classified a supermarket or grocery store, but rather a big-box retailer, in 2023, Walmart earned approximately $421.8 billion from the American market and $611.3 billion globally, per the company’s financial factbook. For reference, that same year, Costco — the second biggest earner — brought in an estimated $173.5 billion from customers in the U.S. (via Costco). That’s a $248.3 billion difference between these two major retailers. If we just consider Walmart’s grocery sales, the retailer brought in upwards of $240 billion in 2023. That’s still a massive difference between the entirety of sales from Costco and the sales of only grocery items from Walmart. That said, Amazon technically has Walmart beat in terms of net income; however, Walmart’s online grocery market share has grown to roughly 26.9% in 2024, while Amazon’s has declined to 18.5% (via eMarketer).
With 4,606 Walmart locations across America, in January 2024, the retail giant’s President and CEO John Furner announced plans to build or upgrade over 150 stores and remodel another 650. Not only is this slated to create more jobs, but the additional locations and updates to existing stores will only increase Walmart’s hold over the grocery market by expanding offerings for customers and encouraging more spending.
Read more: A Guide To Buying Salmon At The Grocery Store
How The Walmart Effect Impacts Local Grocery Stores
Walmart storefront – Alexander Farnsworth/Getty Images
Walmart’s dominance of the grocery market is good for its overall profits, but some research has shown that the stores can have negative impacts on the economy of smaller communities, often forcing smaller competitors and local farmers markets out of business. One analysis was conducted in 2012 by Puget Sound Sage, a non-profit focused on public policy, which found that Walmart stores can decrease the economic output of a community by roughly $13.7 million. Alongside this, the resulting shift in grocery sales diverts around $25.38 million from local retailers as customers choose to shop at Walmart instead.
This phenomenon, known as the Walmart effect, has been well documented. It comes down to the fact that, as a major corporation, Walmart has more buying power than a small local grocer, so it’s able to negotiate prices and deals with suppliers to keep prices low and drive increasing sales. Although this can be beneficial for customers, small businesses often can’t match these low prices; coupled with dwindling sales from a diverted customer base, this can result in them being forced to close down.
In 2019, the Institute for Local Self-Reliance released a report detailing how Walmart has monopolized local grocery markets. It discovered that, out of 203 metropolitan and “micropolitan” areas in the U.S. where the chain controls 50% or more of the grocery market, Walmart controls 70% or more of it in 38 of these regions. This high degree of control, coupled with the fact that Walmart often becomes the go-to grocery store in a region after forcing others out of business, has helped expedite its growth, which currently shows no signs of slowing down.
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