NEW YORK (AP) - Wal-Mart is asking suppliers to cut back on advertising spending in its stores as it seeks lower prices on goods that it sells to its own customers.
The request comes as the world's largest retailer, based in Bentonville, Arkansas, looks to reclaim its position as the low-price leader amid stiff competition and perk up sluggish sales in the U.S.
Historically, makers of consumer products like laundry detergent devote a portion of their budget to market their products at Wal-Mart whether it's online advertising on social media or store displays. Wal-Mart executives told suppliers in February they would rather have them reinvest some of that money.
Wal-Mart Stores Inc.'s actions were first reported by The Wall Street Journal.
Deisha Barnett, a Wal-Mart spokeswoman, confirmed the strategy and said the discounter has made that request in the past but described the recent overture as more of a "reinvigorated focus."
Wal-Mart updated investors Wednesday on how it planned to reduce prices while revving up its assortment and improving the experience of shoppers by the holiday 2015 shopping season, the most important period for a retailer. The actions are being spearheaded by Greg Foran who last summer became CEO of Wal-Mart's U.S. business, which accounts for 60 percent of its total sales.
"We want this year to be the year of improving our stores," Foran told investors.
Foran, who had been president and CEO of Wal-Mart Asia, has been dissecting every part of the business, from improving the freshness of the produce to making sure merchandise is being unloaded onto the selling floor, instead of having it pile up in the backroom.
Among other measures it outlined Wednesday: reducing the price of products nearing their expiration date, a strategy it believes alone will save $500 million annually. The company said that it's also looking at how it sources it products so it can reduce prices, particularly as commodity prices fall.