NEW YORK - Despite 3,000 U.S. stores that generated annual sales last year of $258 billion, Walmart head of U.S. operations Eduardo Castro-Wright said that the world€™s largest retailer still has substantial room to expand in its home market, the Financial Times reports.

Castro-Wright said that Walmart could generate up to an additional $100 billion in annual revenue in U.S. markets where it is currently under-represented.

Walmart is looking to expand in urban markets , notably Chicago, New York and Los Angeles, though its plans in those cities have been hampered by staunch political opposition, led by grocery workers unions, as well as a shortage of suitable large sites.

Countering the latter, the retailer is now looking to develop a range of smaller stores that would be "high productivity stores€¦with higher sales per square foot," according to Castro-Wright.

The intent is to achieve profitability at the smaller stores on par with levels at its 2,400 supercenters. A new store planned for Torrance, California, for instance, will be only 75,000 square feet, less than half of the 185,000 square feet of a typical supercenter store. As a result, it can be built without encountering public planning construction challenges.

The design of the smaller stores is being shaped by the company€™s "Project Impact" remodeling drive, which seeks to increase the sales per square foot of its existing stores through improved shopping logistics and more selective inventory.

Walmart is also experimenting with a series of much smaller store formats, including a pilot of four 10,000 square foot Marketside grocery stores in Arizona and two 39,000 square foot Hispanic-themed Supermercado de Walmarts. It is also testing a 20,000 square foot format, called Neighborhood Market by Walmart, in Bentonville, Arkansas, the company€™s hometown.

"We€™ll continue to expand into new channels so customers can shop and experience Walmart when, where and how they want," said Steve Restivo, a Walmart spokesperson.