Is it a convenience store? A small grocery store? A dollar store? All of the above, or so retail giant Walmart wants the consumer to perceive. The first of two Walmart Express stores opened in a small rural area in AR in early June, which reportedly will grow to 20 by the end of January 2012 and possibly hundreds further down the road. The 15,000 square-foot store, about one-tenth the size of a Walmart Supercenter, will carry limited assortments of food and general merchandise items. Targeting convenience and location, Walmart Express will be a pint-sized version of its Supercenter big brother.

Some see the ‘Express’ format as a direct response to the success of dollar stores during the recession, because of its size and product assortment. Others see it as a competitor to the likes of Tesco’s Fresh & Easy format, or limited assortment retailers like Aldi and Save-a-Lot.  And because of Tesco’s well-documented struggles in the U.S., the Fresh & Easy chain could be a potential acquisition target for Walmart to immediately boost its Express format. However, one of Fresh & Easy’s main faults is that its real estate is not in ideal locations, a strategy Walmart places great emphasis on.

Either way, when Walmart makes a big move in the retail industry, everyone has to take note. Even though it’s ‘Marketside’ format has stood pat for the time being, smaller formats are undoubtedly the source of growth for Walmart, which has been stagnant for a number of quarters.