Walmart (NYSE:WMT) is launching a new grocery brand named BetterGoods, a move aimed at helping the retail giant retain the customers it gained during periods of high inflation. Simultaneously, the company announced plans to shut down all of its health clinics and virtual care services.
Announced on Tuesday, BetterGoods will feature a “trend-forward and chef-inspired” range of food products, with most items priced below $5.
The brand will offer a diverse selection of products, including frozen foods, dairy, and snacks, with prices ranging from under $2 to under $15.
“Today’s customers expect more from the private brands they purchase – they want affordable, quality products to elevate their overall food experience. The launch of bettergoods delivers on that customer need in a meaningful way,” said Scott Morris, senior vice president of private brands, food and consumables at Walmart.
“Bettergoods is more than just a new private brand. It’s a commitment to our customers that they can enjoy unique culinary flavors at the incredible value Walmart delivers.”
According to the statement, it will cater to three main consumer preferences: culinary-inspired items like creamy corn jalapeño chowder, plant-based options such as oat milk non-dairy frozen dessert, and products free from specific ingredients, for example, gluten- and antibiotic-free chicken nuggets.
The move comes as part of a broader trend, with grocers revamping their private label strategies, moving away from basic or imitation products towards more distinctive offerings.
For instance, in 2019, Target (TGT) introduced Good & Gather, featuring diverse products like salad kits and peanut butter spreads, and Favorite Day, which offers innovative versions of ice cream bars and trail mixes.
BetterGoods will be added to Walmart’s roster of grocery brands, which includes Great Value, the largest private grocery brand in the U.S. by revenue, according to market research firm Numerator.
In a separate announcement, the company said it will close all its health-care clinics nationwide, reversing its initiative to extend its affordability to medical services. The retailer will also shut down its telehealth provider, purchased in 2021 for an undisclosed sum.
The closure affects 51 clinics across Arkansas, Florida, Georgia, Illinois, and Texas over the next 45 to 90 days, CNBC reported. The decision will not impact Walmart's 4,600 pharmacies and over 3,000 vision centers.
Walmart cited a broken business model for the closures, describing it in a statement as "a difficult decision" and attributing the failure to "the challenging reimbursement environment and escalating operating costs."