When I lived in Southwest Virginia, my house was about a mile from a Wal-Mart Supercenter. Although I had shopped at Wal-Mart (NYSE: WMT) for years, the convenience of the big store made it into my go-to place for everything from oil filters to rutabagas. I became a Wal-Mart junkie.

One of the things that I quickly noticed about the Squalor Mart was the fact that it is a perfect example of capitalism in action. In my years of shopping at the store, I noticed that obscure products would show up regularly. Sometimes they'd stay, sometimes they'd leave; it all depended upon how well they sold. For example, when the area got a huge influx of Latin Americans, the store dedicated an entire row to dried chilies, beans, hot sauces, tortillas and whatnot. Similarly, as more and more yuppies began frequenting the store, I noticed a definite spike in organic convenience foods. In both cases, Wal-Mart offered better prices (and better service) than the small stores that specialized in these obscure items.

Wal-Mart's problem lies not with what it can offer, but with what it can't: intimacy and a small scale. This, of course, is why many areas have fought so hard to keep Wal-Mart out. They don't want to lose their cute little neighborhood stores to the big, bad capitalist behemoth, which leads to an inevitable question: can Wal-Mart, the ultimate superstore, offer a shopping experience that is anathema to its time-proven formula?

Last week on BloggingStocks, I proposed that Wal-Mart Stores Inc. (NYSE: WMT) "take a one-year break from building more stores, and focus on getting the current stores back on track. One lost year of expansion is not much in the long-run and, if it can help to bolster existing stores, it's a wise investment indeed."

While that was certainly a far-fetched idea, Wal-Mart is planning to cut back on the opening of new supercenters this year by 25, and refocus its energy on improving existing locations. The company will build 190-200 new supercenters this year and, in future years, plans to drop that number to around 170.

The company will be using the savings from reduced capital expenditures to ramp up its buyback program, and management's attention will shift toward improving efficiency and same-store sales, which have been thoroughly unspectacular of late.

Shareholders loved the idea, sending the shares up nearly 4% on the news. I think it makes a lot of sense as well. By focusing on improving existing stores for now, future stores will be stronger. Congratulations to Wal-Mart management for resisting the urge to grow as rapidly as possible, which so many other companies have succumbed to. By slowing up a bit, shareholders will reap vastly greater rewards in the long run.

Wal-Mart Stores, Inc. (NYSE: WMT) continues to get slammed from the media and retail critics as not changing and reacting fast enough to stay ahead of the retail discount crowd these days. Sure, the company is making record amounts of revenues (profit margin is another matter), but the company's monthly same-store sales stats and quarterly results aren't comparing to established expectations, nor are they outshining results from competitor Target Corp. (NYSE: TGT).

It's hard to measure Wal-Mart against any other retailer just based on its sheer size, merchandising prowess, and customer availability (supercenters seem to be everywhere these days), but the company has clearly made some strategic errors of late that have impacted results. While I'm not sure which traffic drivers Wal-Mart plans on to get feet in the door (then selling as much as possible to that captive audience), its recent admission of apparel planning mistakes seems to underscore the challenges the world's largest retailer has in trying to get its shine back.

While sales in the U.S. continue to get a collective "yawn" from market pundits and journalists, the company's about-face move in international retail seems to be moving rather fast as the company wants to reap more sales and margin from those markets than from the U.S. market (which takes time investors are not willing to give, it seems). Wal-Mart's recent partnerships with China's Trust-Mart and India's Bharti state to the world that Wal-Mart is serious about its international plans, even in the face of market withdrawals in Germany and South Korea in 2006. The rumor that Wal-Mart may be looking to acquire or take a stake in Indian logistics and retail distribution company Radhakrishna Foodland says that Wal-Mart is placing a pretty good deal of importance into rapidly-expanding markets (India is at the top of that list with China).