Wal-Mart says looking at suppliers to help lower costs

(Reuters) - Wal-Mart Stores Inc (WMT.N) is looking at how it sources its products in an effort to reduce prices, especially as commodity prices fall globally, the head of the its U.S. division said on Wednesday.

Speaking at a briefing for analysts and investors, Greg Foran said the company had launched several projects aimed at re-establishing price gaps over its rivals, including looking at how it works with its suppliers.

"While we have pockets of leadership, in more competitive markets our gap is too small. And against some competitors we are beaten," said Foran, who took over the helm of the U.S. operations in August.

He said that investments in lower prices would be balanced against the need to invest in customer service. Last month Wal-Mart announced that it was investing $1 billion to raise the wages of half a million store employees.

Foran said there was room for improvement across its stores, including better stocking of shelves and rotation of fresh produce.

He said improvements would be implemented so that "by the time we hit holiday season our stores are clean, tidy, well-merchandised and run by engaged associates. Today in the main we are not."

Shares of Wal-Mart were down 1.8 percent at $80.78.

(Reporting by Nathan Layne; Editing by Lisa Von Ahn and Ted Botha)