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Wal-Mart's fresh produce promise: Fewer middlemen, faster groceries

Wal-Mart Stores, Inc.Tesco plc

Wal-Mart Stores Inc., the world’s largest produce seller, is trying to keep pace with rival grocery stores by freshening up its selection of fruits and vegetables.

On Monday, the Bentonville, Ark., mega-retailer unveiled a new initiative to speed up delivery of farm-grown goods from the fields to shelves by trimming many of its middlemen and buying 80% of its produce directly from local growers.

The strategy strips out the time needed for third-party wholesalers to consolidate produce from farms before sending it off to the dozens of regional Wal-Mart distribution centers.

In many cases, executives said, fruits and vegetables will arrive at least a day earlier in the chain’s thousands of stores. The retailer will also be able to better manage its inventory levels, hewing more closely to demand instead of overstocking produce.

Wal-Mart has recently tried to make fresh, healthful foods more appealing to its customers, many of whom can’t afford to shop at pricier outlets such as Whole Foods.

The chain’s stores currently receive produce from in-state growers in all 50 states, according to the company, which said its commitment to doubling its sales of local produce from 2010 to 2015 is “well on its way.” 

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Wal-Mart will also train some 70,000 employees to recognize when produce needs to be removed from shop floors, said Jack Sinclair, executive vice president of the grocery division for Wal-Mart U.S., in a conference call with reporters.

As for recent investor concerns about patchy staffing levels and empty shelves at Wal-Mart, Sinclair said the chain has “exactly the right people in exactly the right place."

“We feel in pretty good shape at the moment,” he said.

Additionally, Wal-Mart will implement weekly independent checks of its grocery aisles, comparing itself to rival grocers, he said.

Sinclair also reiterated Wal-Mart’s policy to allow full refunds of fresh grocery goods without requiring customers to bring back the products.

“We want our customers to be absolutely confident in the quality of the produce they purchase at Wal-Mart,” he said.

Wal-Mart will hold its annual shareholders meeting on Friday.

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