Business of Design

Walmart saves $200 million by changing its light bulbs and $20 million with a new floor wax

Key Points
  • Walmart's size means that small changes yield big results.
  • Walmart says switching to LED lights in its parking lots cut its annual energy costs by $200 million.
  • A change in the floor wax it uses cut costs by $20 million a year because the floors need to be buffed less often.
Check out counters in Walmart.
Jeffrey Greenberg | UIG | Getty Images

The multiplying power of size makes it easy to save big money on little changes.

Imagine saving millions of dollars just by changing light bulbs and floor wax. It's exactly what Walmart is doing.

"We are in the process of a multiyear rollout of replacing all fluorescent fixtures with LEDs in our stores, clubs and parking lots," Chief Financial Officer Brett Biggs told analysts Tuesday at the retailer's investor day at its headquarters, in Bentonville, Arkansas. "Not only is it good for the environment, these changes could reduce our annual energy costs by $200 million over time."

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In the U.S. alone, Walmart buys tens of billions of dollars' worth of goods and services used for the business that aren't sold in its stores, a category called "goods not for resale." These are goods like travel services or maintenance supplies.

One of those items, is floor wax for stores, which the world's largest retailer recently changed.

"Not only is the new wax cheaper, it's also sturdier. It doesn't need to be buffed as often, resulting in less spent on the actual buffing, as well as fuel for the machines," Biggs said. "That one change in floor wax will save us over $20 million a year."

It's savings on a major scale.

Walmart's founding principle is "everyday low price,4" which can only be achieved by everyday low cost. The more Walmart saves on the cost side, the more shoppers save at checkout.

Earlier Tuesday, Walmart cut its earnings outlook. As expected, profits were hurt due to the impact of its acquisition of Indian e-commerce company Flipkart.

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