Final answer:
The risk to Walmart's opening of smaller Walmart Express stores is cannibalization. This internal competition may affect the overall sales of the company by drawing customers away from their larger supercenters. Additionally, there is a concern of furthering negative impacts on local economies, as Walmart's expansion can undermine locally owned businesses.
Step-by-step explanation:
One risk to Walmart's effort of opening smaller Walmart Express stores that are one-tenth the size of its supercenters is cannibalization. Cannibalization occurs when a company's new project or store draws customers away from its existing operations, which can lead to a decrease in the company's overall sales, despite the increase in the number of stores.
This phenomenon can be particularly problematic when the new stores are in close geographic proximity to existing ones, leading to internal competition within the company instead of capturing additional market share from competitors.
Walmart's traditional business model of operating large supercenters has been associated with significant impacts on local economies and communities, often referred to as the Wal-Martization effect. This includes the undermining of locally owned businesses, negatively affecting local manufacturers, transportation workers, and media outlets.
By introducing smaller stores like Walmart Express, the company may attempt to adapt to changing consumer demands for convenience and locality but may inadvertently exacerbate the problem by potentially reducing sales at nearby supercenters.