For years, Walmart was widely viewed as the less luxurious, more affordable option among major retailers. It was where low prices often came with a no-frills atmosphere and the occasional odd encounter that made the chain feel a step below its competitors.
That perception, however, is steadily changing.
In recent years, Walmart has invested heavily in store upgrades to shed its once less-than-pristine reputation. Its latest move seeks to further elevate the shopping experience by turning everyday errands into small, affordable indulgences.
Imagine strolling through Walmart with a latte in hand while shopping for groceries and household essentials, making each trip feel a bit more like a mini pampering session.
If this idea sounds familiar, it’s because it is.
Target has long offered in-store Starbucks locations, and now Walmart is taking a page from its rival’s playbook by partnering with one of Starbucks’ biggest competitors.
Walmart to open the first in-store Dunkin’ in San Antonio
Walmart (WMT) will debut a Dunkin’ inside its store at 1515 N. Loop 1604 E. in San Antonio, Texas, according to a Texas Department of Licensing and Regulation filing submitted on January 15.
The filing states that the remodeling is expected to be completed by May 28, 2026. The project will occupy 30,653 square feet inside the store and cost approximately $215,000.
The new in-store Dunkin’ will mark a first for San Antonio residents. Walmart already operates in-store Dunkin’ locations in other Texas cities, including Cypress, Boger, and Rockport, according to the chain’s store locator.
Walmart’s broader expansion and remodeling push
Walmart has reassessed its store fleet in recent years, investing heavily to better align with shifting retail trends and evolving consumer expectations.
In 2024, the company unveiled its “Investing in America” plan, a multi-million-dollar strategy to modernize stores, expand operations, and create more jobs nationwide.
As part of this plan, Walmart intends to build or convert more than 150 stores while continuing to upgrade existing locations over the next several years. So far, the company has remodeled at least 650 stores across 47 states and Puerto Rico.
Walmart is also rolling out new in-store technology designed to better integrate its physical and e-commerce businesses. The retailer recently introduced digital QR codes at its Supercenter in Cypress, Texas, its first Supercenter in four years and the debut of its “Store of the Future” concept in the U.S.
Walmart plans to open new Supercenters in Frisco, Texas; Melissa, Texas; Eagle Mountain, Utah; and Eastvale, California. Neighborhood Markets will debut in Tuscaloosa, Alabama; Milton, Florida; and Pace, Florida, while stores in Mountain View, California; and East Windsor, New Jersey, will be converted into full Supercenters, according to a company press release.
These investments have been paying off. In the third quarter of fiscal 2026, Walmart’s total revenues increased 5.8% year over year. In the U.S., net sales rose 5.1% and comparable sales were up 4.5%.
Households earning more than $100,000 made up 75% of Walmart’s market share, said CEO Doug McMillon on the company’s earnings call for the third quarter of fiscal 2025. This suggests that the company’s efforts to enhance the consumer experience are resonating with higher-income consumers.
“Majority of recent analyst commentary skews constructive, underlining Walmart’s resilient execution and potential for further growth, even as a subset of analysts flag valuation and macro-specific risks that could restrict near-term upside,” wrote industry analysts at Simply Wall St.
Target’s longstanding Starbucks partnership
Walmart’s growing partnership with Dunkin’ mirrors Target’s long-running relationship with Starbucks.
Target (TGT) launched its collaboration with Starbucks (SBUX) in 1999, opening the first licensed Starbucks store within retail locations in the U.S. The move helped position Target as a one-stop shop while enhancing the customer experience.
By 2023, Starbucks had expanded to more than 1,700 in-store locations within Target, according to a company press release, nearly matching Target’s roughly 2,000 U.S. stores.
While Starbucks once played a key role in Target’s rise, both companies now face challenges.
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Target has struggled with declining sales, shrinking foot traffic, and market share losses, partly due to backlash tied to several controversial business decisions.
In the third quarter of fiscal 2025, Target’s net sales declined 1.5% year over year, while comparable sales fell 2.7%, driven primarily by lower traffic and a decrease in average transaction size.
Starbucks has also faced headwinds after decades as a seemingly untouchable coffee giant. Inflation and shifting consumer habits have weighed on performance, though recent results signal some improvement.
Under its “Back to Starbucks” turnaround strategy, the company reported flat North America and U.S. comparable store sales in the fourth quarter of fiscal 2025, with a 1% increase in average ticket offset by a 1% decline in comparable transactions.
Why Walmart’s Dunkin’ expansion could reshape its in-store strategy
At first glance, Walmart’s strategy may seem counterintuitive. The retailer is currently outperforming both Target and Starbucks, companies now revising strategies that once fueled their growth.
Yet the move better aligns with Walmart’s core identity.
Walmart has long partnered with popular, value-oriented fast-food brands that resonate with its price-conscious customer base. As a self-claimed one-stop shop, the retailer has integrated affordable dining options into its locations, allowing shoppers to eat and run errands in a single stop.
Given that Dunkin’ is generally more affordable than Starbucks, according to Cozymeal, this partnership could be a natural fit. With San Antonio set to become Walmart’s fourth in-store Dunkin’ location in Texas, recent traffic and visit data indicate the strategy is gaining traction.
In the second quarter of 2025, Walmart’s total and same-store visits increased 1%, while Target’s total visits declined 3.9% and same-store sales fell 2.6%, according to Placer.ai data.
“Walmart’s foot traffic stability combined with proven ecommerce growth positions it well to continue outperforming, especially as consumer caution favors essentials and convenience,” said Placer.ai retail industry analyst Lila Margalit.
“Furthermore, the retailer’s rebranding and push into broader, discretionary categories may help attract higher-income consumers who are trading down.”
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