Wal-Mart

Corporate logo of Wal-Mart Stores, Inc. Usage restricted. Trademarks on this page belong to their owner. See

General Information

Sam Walton, the founder of Wal-Mart, opened the first Wal-Mart store in Rogers, Arkansas in 1962. The company is publicly traded at the New York Stock Exchange under the symbol WMT and has its headquarters in Bentonville, Arkansas.

Wal-Mart operates large discount retail stores selling a broad range of products such as clothing, consumer electronics, drugs, outdoor equipment, guns, toys, hardware, CDs and books. Its typical products are basic, mass-market equipment, rather than premium products stocked at specialist stores. Wal-Mart also operates "Supercenters" which include grocery supermarkets. SAM'S CLUB stores are also owned by Wal-Mart; these are "warehouse clubs," which require a paid membership to access. (Compare Costco)

Wal-Mart's chief competitors as discount retailers include the Kmart Corporation and the Target Corporation.

Each Wal-Mart store has an employee, often an older person, known as a "greeter", whose primary responsibility is to welcome people to the store. One Wal-Mart training video encourages employees to think of themselves not as employees but as "associates" and their superiors as "servant leaders." The training video You've Picked a Great Place to Work promotes the "essential feeling of family for which Wal-Mart is so well-known." (Ehrenreich pp. 143-4) Employees start the work day with a gathering and the "Wal-Mart cheer".

Former First Lady Hillary Clinton formerly worked as a lawyer for Wal-Mart.

Wal-Mart is financially successful by a number of measures. For example, Wal-Mart is now the #1 grocery chain in the United States, ahead of Kroger ($95 billion in sales compared to $51 billion in sales). Different explanations have been offered for this success:

Some stress the economies of scale Wal-Mart brings to manufacturing and logistics; the purchase of massive quantities of items from its suppliers combined with a very efficient stock control system help make Wal-Mart's operating costs lower than those of its competitors. (They are leaders in the field of vendor managed inventory -- asking large suppliers to oversee stock control for a category and make recommendations to Walmart buyers. This reduces the overhead of having a large inventory control and buying department.) Wal-Mart also has unique power to actually force manufacturers to change their production (usually by creating cheaper products) to suit Wal-Mart executives' wishes.

Some allege that Wal-Mart accepts short-term losses through short-term aggressive pricing in order to drive competitors out of business and increase market power. Wal_mart also has translated its economic power into political favoritism and garnered millions of dollars in direct public subsidies and indirect subsidies through such means as confiscation of private property via eminent domain takeovers.

Criticism of Wal-Mart

None of Wal-Mart's stores are unionized (as of 2003). Like many US retailers, a high proportion of the employees are temporary (around 33% as of 2002). The company is the target of persistent unionizing efforts, but has aggressively (and sometimes illegally) fought off all attempts. In 2000, the meat-cutting department of the Wal-Mart superstore in Jacksonville, Texas voted to unionize; two weeks later, Wal-Mart shut down all its meat-cutting operations. Employee Kathleen Baker submitted a petition from 80 Wal-Mart employees which requested wage increases; she was then fired for "theft" of the company typewriter. s at Wal-Mart are about 20% less than at comparable companies. Walton once argued that his company should be exempt from the minimum wage. (Palast -- pp. 121)

Wal-Mart is the most often sued corporate entity in the United States. Its legal department has a reputation among personal injury lawyers for extremely aggressive legal tactics, and the corporation has been sanctioned by several courts for failing to respond properly to plaintiff discovery motions.

Wal-Mart managers have sometimes pressured employees to work "off-the-clock" after they have worked 40 hours in order that overtime pay may be avoided.

As of 2000, Wal-Mart, like many large American corporations with low-wage employees, screens potential hires through a drug test, in addition to a multiple choice personality test, which asks applicants to express their level of agreement with statements such as "rules have to be followed to the letter at all times." (Ehrenreich, p. 124)

Wal-Mart is also criticized for maintaining an atmosphere in which it might appear that they predominantly carry products "Made in America", whereas in reality, the vast majority of Wal-Mart products are NOT made within the United States. Greg Palast reports that Chinese dissident Hongda Wu discovered, in 1995, that Wal-Mart was contracting prison slave labor in Guandong Province. Wu and Palast argue that numerous items at Wal-Mart are made by the Chinese People's Liberation Army. In Bangladesh, Palast reported that in 1992 teenagers were working in "sweatshops" approximately 80 hours per week, at $0.14 per hour, for Wal-Mart contractor Beximco. In 1994, Guatemalan Wendy Diaz reported that, at the age of 13, she had been working for Wal-Mart at $0.30 per hour. (Palast pp. 119-120)

Product controversy

In 2002 and 2003, Wal-Mart decided not to carry certain products, because of racy content, such as Maxim, FHM and Stuff magazines. However, men's magazines were not singled out, as they also strategically "covered up" certain fronts of Redbook, Cosmopolitan and Marie Claire due to alleged customer complaints. Some music sold in Wal-Mart had obscenities overdubbed with less offensive lyrics, such as albums from Lauryn Hill and The Fugees or are removed from the shelves for lyrics critical of Wal-mart, such as those by Sheryl Crow. While some see it as a troubling case of censorship, others view it as Wal-Mart sticking to the sensibilities of middle America.

External links

• Wal-Mart homepage
• Wal-Mart watch, a site critical of the company
• Sprawl Busters

Sites documenting resistance movements to Wal-Mart and chain store proliferation:

• The New Rules Project
• American Independent Business Alliance

References

• 1 -- The Best Democracy Money Can Buy by Greg Palast (2002)
• 2 -- Nickel and Dimed: On (Not) Getting By in America by Barbara Ehrenreich (2001)

Literature

• "In Sam We Trust" by Bob Ortega is an excellent biography of Sam Walton, for those who want to dig in deep to Wal-Mart's history.

Referenced By