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Board member Sarah Friar: Walmart will be a great company for the next 100 years

Melody Hahm
Senior Writer

As the world’s biggest company by revenue and third-largest employer, Walmart (WMT) is synonymous with scale.

At first blush, the Bentonville, Arkansas-based behemoth doesn’t have much in common with a small business. But Walmart board member and Nextdoor CEO Sarah Friar argues otherwise.

“Walmart often is not portrayed well in the media...But in the reality of their soul, Walmart still feels a lot like a local business,” she said in an interview for Yahoo Finance’s “Breakouts” series this week.

“[Walmart founder] Sam Walton always put his customer first. He believed in values that were sustaining long after he is no longer with us. If you always have the lowest price, the best selection, and you're always available for your customers — so he opened later than any other store — you would win your customer set,” she said.

“You learn so much that you can bring back to even small companies. How Walmart thinks about its global platform is actually very applicable to a business like Nextdoor where we're trying to figure out how do we turn on countries quickly. We’re in [year] eight today, how can we be a 20 and 40 and so on?” she added.

‘The company was willing to take big risks’

Walmart first added Friar to the board one year ago when she was still the CFO of Square (SQ), citing her sterling resume, which includes taking Square from a startup to a publicly traded company as well as stints at McKinsey, Goldman Sachs, and Salesforce.

Dublin , Ireland - 12 June 2018; Sarah Friar, CFO, Square, on Centre Stage during day one of MoneyConf 2018 at the RDS Arena in Dublin. (Photo By Stephen McCarthy/Sportsfile via Getty Images)

“... Walmart will benefit from her fresh perspective and skillset, which includes strong expertise in finance, operations, strategy and knowledge of technology,” Walmart Chairman Greg Penner said in the announcement.

Despite the oft-repeated narrative that Walmart is losing out to Amazon, this may not necessarily be the case. The tech giant reported last week that North America sales rose 18% year-over-year in the quarter, slowing from the 42% a year ago. Sales in North America have now slowed for three straight quarters.

Meanwhile, investors feel Walmart’s holiday season will have been buoyed from online grocery ordering, ship from store capabilities and a wider selection on its website.

And beyond North America, Walmart has been aggressively trying to gain a deeper foothold in China and India. Last year, Amazon lost an expensive bidding war for Indian e-commerce behemoth Flipkart. Walmart ended up acquiring a 77% stake in the company for a whopping $16 billion. The deal was already in the works when Friar became a board member and closed shortly after she joined.

“I'm just fascinated by really hard problems. And I think [Walmart] faces such an incredible shift, going from offline to online, and what that could do to their business over time. And yet I found the company was willing to take big risks,” she said.

“Seeing the company, particularly CEO Doug McMillon, be willing to lean in on that, really impressed me. They're not going to just sit around. They are going to really get out over the edge of their skis to be a great company for the next hundred years,” she added.

It remains unclear whether Walmart’s bold bet on India will pay off. Shares of Walmart fell after the announcement and Flipkart recently had to pull thousands of products offline because a new set of e-commerce rules imposed by the Indian government.

Still, Friar is impressed with Walmart’s ability to stay relevant and resilient amid such a pressure cooker environment. Shares of Walmart are down 11% over the last year and the company reports fourth-quarter results on February 19.

Melody Hahm is a senior writer at Yahoo Finance, covering entrepreneurship, technology and real estate. Follow her on Twitter @melodyhahm. She hosts Breakouts, a monthly interview series for Yahoo Finance featuring up-close and intimate conversations with today’s most innovative business leaders.

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