NEW YORK — Walmart stands ready to “navigate whatever policy changes come” post-election and better serve pressured but resilient customers in what has been a sturdy economic environment, Doug McMillon, president and chief executive officer of the Bentonville, Ark.-based retailer said at the Morgan Stanley Global Consumer & Retail Conference.

Recently on his social media platform, President-elect Donald Trump indicated that tariffs would be among the immediate moves of the new administration. That includes a 25% across-the-board tariff on goods imported from Mexico and Canada, an extra 10% tariff on all Chinese imports and a 100% tariff on imports from BRICS nations — all of which could shake up economic conditions for farmers and commodities suppliers, manufacturers, retailers and consumers.

Yet in a Dec. 3 fireside chat at the Morgan Stanley event, held in New York, McMillon said the incoming government’s actions remain a question mark.

“I don’t know what’s going to happen policywise; we’re all reading the same news,” he said. “What we’ve learned through the pandemic and all the other things that we’ve been through is to be able to react fast. So we have the ability to do that. We’ve got a depth of experience, and we can navigate whatever policy changes come. I’m sensitive to how our customers feel as it relates to these issues. I’m sensitive to how our associates feel about the environment that we’re in, and we just have to stay empathetic and communicate, make the best decisions we can along the way in what will be a volatile and surprising world, as it has been for years now.”

The US economy enters the holiday sales period on solid footing after experiencing volatility in recent years, McMillon said.

“The pandemic hits in 2020 and 2021, and there are things that happen like inflation on the tail end of that as the supply chain gets stretched,” he said. “And for years now — if I go back to, I don’t know, ’20, ’21, ’22, as I was talking to my peers, CEOs of suppliers and other business leaders — we all kind of felt the same way that there are storm clouds on the horizon, and there might be a hard landing, there might be this or that, and it feels like that for more than 24 months. I was looking at those storm clouds, but the wind never actually blew them this way. And they kind of dissipated, and now I don’t feel the same way. I don’t know what shocks are going to happen to the system, but knowing what we know at this moment, the economies held up well in this country.”

Consumers still price-sensitive

McMillon described the Walmart customer as “pretty consistent,” even with “a little bit of softness in some other markets” following the election.

“The pressure didn’t actually flow this way toward retail as far as we can see, but I want to be sensitive to those who have lower income levels and acknowledge that this inflationary cycle has been really detrimental and created a lot of pressure for them and their families,” he said. “And we’re sensitive to that. We’re a purpose-led company that wants to help people save money and live better. We really mean that, and that motivates us.”

Though navigating higher costs in the last few years has “been a challenge” for Walmart, the company is “doing everything we can to try and get prices down,” McMillon said, citing 6,000 Rollbacks now in effect at Walmart US. Walmart also is drawing customers across the income spectrum, he added.

“Everybody at this point, to some degree, is shopping at Walmart,” McMillon said. “They may be cherry-picking categories depending on what they’re looking for. But those people with more money are liking what we’ve done from a convenience point of view in responding to the breadth of assortment that’s online now in a positive way. And that, along with (Walmart+) membership, gives us some confidence that regardless of what happens with the cycle and regardless of how price-sensitive people are, we can still effectively serve people with lower incomes and we can serve people with higher incomes.”

Part of that ability, McMillon said, stems from an earlier price investment made by Walmart to add more space from competitors.

“So how much should we invest in price?” he said. “We like where our price gaps are. We made an investment — a large investment — years ago to reset where we were in pricing, and we’ve been maintaining those price gaps through pandemic periods of time and through inflationary periods of time. That continues up until this day, and we’ll keep managing price gaps by day and by week. We’ve got an assortment that’s really growing, and the experience is getting better.”

On the watch for food inflation

Looking ahead to 2025, McMillon is keeping an eye on food pricing amid some commodity cost pressure.

“I’m disappointed to see food inflation start to tick back up,” he said. “It’s primarily driven by eggs and what’s happening with dairy right now. But it’s not just those categories. There’s pressure on cocoa and some other inputs.”

Consumers also remain uncomfortable with food pricing still well above pre-pandemic levels, McMillon noted.

“If you look at all of food, prices are a lot higher than they were before the pandemic, which is not what the customers want and not what we want,” he explained. “We have some suppliers who are stepping forward to help drive volume. And we appreciate that very much, and we want everybody to do that. We have a lot of Rollbacks trying to get prices back down, and eggs and milk will adjust faster than dry grocery categories would, for example. But it feels to me like processed food (pricing) doesn’t go back down to pre-pandemic levels and may not come down much during the course of this next year. But I would like to see customers get some relief on that side of the equation.”

Meanwhile, Walmart customers have received some relief on the general merchandise side, where McMillon said prices are just “low-single-digits higher” versus pre-pandemic levels.

“I’d like to keep that going, and I’d like to see more progress on the food side,” he said, acknowledging that 2025 will bring some food price inflation. “(It’s) starting off that way. I don’t know what the whole year is going to look like. I hope, and I think, it could be better as these commodities adjust, some of them.”

Walmart remains pleased with strong consumer uptake for its private labels — including the bettergoods line launched this spring — but the retailer wants competition with national brands to stay high, McMillon said.