Wal Mart, friend or foe of the neighborhood?

[cato2]

They wanted to put a Wal-Mart into the downtown area of Cleveland, Ohio. It was to be on land that has not been in use for many a year. Seems like a good idea at first. Jobs created, availability of merchandise, and just something new in an area were new construction has not taken place in years.

But as time went on voices were heard in the community which were against this proposition. The local retailers were fighting the idea because it would of course taken away from their stores. Neiborhoods were concerned about the addition of traffic into the inner city neighborhoods. People were concerned about what the effects were going to be on the roads and who would pay for the repairs from the increased traffic. And what would these jobs ultimately bring in to the local economy in real money in a paycheck.

You might recall that Cleveland was one of the cities used in the Presidential debates. The reason is that the economy has suffered, and still suffers. It is a manufacturing city that has lost jobs and people and is hurting, and it is still hurting. So on the surface it looks like a good proposition, but is it?

Does anyone have any experiences with a Wal-Mart store going up in their neighborhood? Was it good for the overall economy, or did it in fact shut down the smaller stores that were in existance already. And were there really benifits to the community?

Wal-Mart started out in rural areas and one of the complaints is that it killed off the smaller privately owned stores with lower prices. Now they dominate the market in these small towns. How many people lost investments is hard to say. And did the community effected really stand to be better off?

Wal-Mart to Add Jobs in Struggling Areas


Wal-Mart Stores Inc., the world's largest retailer, said Tuesday it plans to build more than 50 stores in struggling communities over the next two years, as part of a goal to create between 15,000 and 25,000 jobs.

Wal-Mart said it will build the stores in neighborhoods with high crime or unemployment rates, on sites that are environmentally contaminated, or in vacant buildings or malls in need of revitalization.


The Bentonville, Ark., company said it expects many of the jobs will be in minority communities and could generate more than $100 million in state and local tax revenue. It already has over 1.3 million U.S. employees.
Wal-Mart already has plans to open between 335 and 370 new U.S. stores this year after 341 last year and has said it sees room for more than 1,500 additional stores in the United States in the coming years, on top of nearly 3,200 it already operates.


The retailer, which has stepped up efforts to burnish its reputation after mounting attacks, also will create 10 "Jobs and Opportunity Zones" around stores in troubled communities that will aim to bolster local businesses in those areas.


A new store to open on the West Side of Chicago will anchor the first of 10 such zones. The company said it will release the locations of the other zones in the coming months.


Wal-Mart shares fell 24 cents to $46.53 in morning trading on the New York Stock Exchange. "Wal-Mart has never been afraid to invest in communities that are overlooked by other retailers," Chief Executive Lee Scott said in a news release.


"This is a commitment to reach beyond our stores, to further engage the community, and to offer an even greater economic boost to people and neighborhoods that need Wal-Mart the most," Scott added.


In the face of opposition to stores in some neighborhoods and mounting attacks from unions and other organized critics, Wal-Mart has gone on the offensive to portray itself as a good corporate citizen that saves working Americans money.


In February, it recruited former civil rights leader Andrew Young to head a group of community leaders that Wal-Mart funds to speak up on its behalf as Working Families for Wal-Mart. Young told The Associated Press at the time that one of the reasons he supported Wal-Mart was because it was more willing than other retailers to go into low-income city and rural communities.


Wal-Mart critics dismissed the new program as a publicity stunt.
"Rather than address the serious issues of unaffordable health care, poverty wages, crime, and sprawl, Wal-Mart's latest and greatest public relations stunt is to try to rebuild a fraction of the very communities and small business it has helped destroy," said Chris Kofinis, spokesman for WakeUpWalMart.com, a campaign group funded by the United Food and Commercial Workers union.

http://news.yahoo.com/s/ap/20060404/.../wal_mart_jobs

[DocDiggs]

All the anti-WM arguments presented are of course the old standards, tried and maybe/maybe not true. I really don't care to go into them in any detail other than to say that as far as the road wear, traffic, etc., my observations based on 3 WM's within reasonable driving distance suggest that while there may be increased traffic, it is not really noticeable. These store sites are chosen for easy access and whether or not their customers accelerate wear and tear on the main roads they are on is doubtful. All the roads that I have seen WM's on here in Orlando, FL 'burbs and the Far West Chicago 'burbs where I used to live were on major roads, several on roads that are widely used by commuters and intercity traffic.

The WM's that have been know to create economic problems for small shop owners are generally near smaller towns in more rural areas where people have to drive from far outlying towns and farms to shop.

If "properly" taxed, the WM, or like stores, can provide income for an area as well as jobs, etc.

The most significant problem in my POV is the questionable manner in which WM Corp deal with it's employees. SOP is to hire a goodly number of people, but not pay a reasonable rate, generally per hour. It is common to block workers into time slots of less than 40 hours per week, which puts non-supervisory personnel into part time status and therefore not qualified for full time perks such as health care, overtime, and so on. The pay is lower than should be reasonably paid. So while jobs are plentiful, any non-full time employee is not going to earn very good money and will have no benefits. I have found also that many WM employees are retirees who wish/need only part time work. I have to assume that in regions where that is the practice, it will knock out many potential younger job hunters with families.

On the other hand, the choice of quality products is great and the prices are low. So perhaps it's really a toss up as to whether a new WM is of benefit to any community. It would appear that in larger communities with a wide draw of customers that these stores are indeed beneficial. In more rural or outlying areas, they will quite probably be a very mixed blessing, helping many while hurting some.

[dynamic_one]

I cannot truly assess what it is that makes Walmart so good. Perhaps, it is that it Does allow the consumer an extremely wide selection of basic style goods at a reasonable price. And, in today's hard times, this is a necessary niche. I have to believe that it is true that Walmart is responsible for closing down many Mom and Pop establishments. But, one has to realize that each of these establishments had the opportunity to become the top dog in that sector. Choosing to stay small and complaining about not being able to get the same bulk discounts and favor status from manufacturers and distributors was not the answer.
Furthermore, the convenience of one stop shopping in a society that has suddenly felt the pain of higher fuel prices, is all too attractive.

Walmart fills a shopping sector that is greatly needed by about 95% of Americans. It is the Kmart sector. The store where everyday, lower waged, people can go and find unremarkable, ordinary, every day items. They do not compete with Target for style. They do not compete with upscale department stores for luxury.

Realize one last point. No one at CVS, Best Buy, Petsmart, Sears, Kmart or Target complains that their pay is small. Yet, they make minimum wage and most have less than 40 hours making them ineligible for benefits. We only hear about grumblings about pay from Walmart because they are the Top Dog in the retail sector. But, they could not have done this had they chose to have incorporated the same benefits practices as, lets say, the big 3.

When I was in High School (Graduated 1984), I was told that I had to have a college degree in order to get a good job. Yes, I know there are people out there who have college degrees and word at Walmart. But, you have to admit that you stand a much greater risk of ending up on the lower rungs of the pay scale if you do not choose to accell early. No one should expect to be given jobs with great benefits packages when they did not try very hard to get the good job.

[DocDiggs]

Originally Posted by dynamic_one

I cannot truly assess what it is that makes Walmart so good. Perhaps, it is that it Does allow the consumer an extremely wide selection of basic style goods at a reasonable price. And, in today's hard times, this is a necessary niche. I have to believe that it is true that Walmart is responsible for closing down many Mom and Pop establishments. But, one has to realize that each of these establishments had the opportunity to become the top dog in that sector. Choosing to stay small and complaining about not being able to get the same bulk discounts and favor status from manufacturers and distributors was not the answer.
Furthermore, the convenience of one stop shopping in a society that has suddenly felt the pain of higher fuel prices, is all too attractive.

Walmart fills a shopping sector that is greatly needed by about 95% of Americans. It is the Kmart sector. The store where everyday, lower waged, people can go and find unremarkable, ordinary, every day items. They do not compete with Target for style. They do not compete with upscale department stores for luxury.

Realize one last point. No one at CVS, Best Buy, Petsmart, Sears, Kmart or Target complains that their pay is small. Yet, they make minimum wage and most have less than 40 hours making them ineligible for benefits. We only hear about grumblings about pay from Walmart because they are the Top Dog in the retail sector. But, they could not have done this had they chose to have incorporated the same benefits practices as, lets say, the big 3.

When I was in High School (Graduated 1984), I was told that I had to have a college degree in order to get a good job. Yes, I know there are people out there who have college degrees and word at Walmart. But, you have to admit that you stand a much greater risk of ending up on the lower rungs of the pay scale if you do not choose to accell early. No one should expect to be given jobs with great benefits packages when they did not try very hard to get the good job.

Interesting input.

It appears to me that the folks (not all obviously) are poorly educated for a variety of reasons. While anyone can work hard, be original and creative, and excel at working with others and becoming expert at whatever job they do, it seems to me that so many folks in what may be termed the "lower socio-economic" catagory, just do not have the skills or drive to do those things. Yes, some do...other just plod their way thru life working at unskilled jobs and continuing to survive pretty much on a day-to-day basis. My belief is that even those workers should be granted whatever number of work hours, etc., necessary to acquire the perks that so many of us enjoy.

WM's rep is that they purposely schedule employees so that they cannot reach a point where they qualify for these things. That is wrong and obviously a grand manipulation of these people to get the work without the expense. If other companies do this, that's pathetic. WM's practices became known nationally not long ago because of various lawsuits, reportage, and investigations. To my knowledge, they have not as yet changed anything. This is crass and deliberate and certainly unworthy of the world's largest retailor.

[odannyboy]

Originally Posted by dynamic_one

I cannot truly assess what it is that makes Walmart so good. Perhaps, it is that it Does allow the consumer an extremely wide selection of basic style goods at a reasonable price. And, in today's hard times, this is a necessary niche. I have to believe that it is true that Walmart is responsible for closing down many Mom and Pop establishments. But, one has to realize that each of these establishments had the opportunity to become the top dog in that sector. Choosing to stay small and complaining about not being able to get the same bulk discounts and favor status from manufacturers and distributors was not the answer.
Furthermore, the convenience of one stop shopping in a society that has suddenly felt the pain of higher fuel prices, is all too attractive.

Walmart fills a shopping sector that is greatly needed by about 95% of Americans. It is the Kmart sector. The store where everyday, lower waged, people can go and find unremarkable, ordinary, every day items. They do not compete with Target for style. They do not compete with upscale department stores for luxury.

Realize one last point. No one at CVS, Best Buy, Petsmart, Sears, Kmart or Target complains that their pay is small. Yet, they make minimum wage and most have less than 40 hours making them ineligible for benefits. We only hear about grumblings about pay from Walmart because they are the Top Dog in the retail sector. But, they could not have done this had they chose to have incorporated the same benefits practices as, lets say, the big 3.

When I was in High School (Graduated 1984), I was told that I had to have a college degree in order to get a good job. Yes, I know there are people out there who have college degrees and word at Walmart. But, you have to admit that you stand a much greater risk of ending up on the lower rungs of the pay scale if you do not choose to accell early. No one should expect to be given jobs with great benefits packages when they did not try very hard to get the good job.

there is a reason that Wal-Mart, keeps the prices so low, and more importantly, there is ANOTHER cost to those "low low prices", it is American jobs.

The laundry list is endless in what that COST is in getting the cheapest goods available, and yes, Wal-Mart beats ALL the competitors in the cost department, just dont, as a supplier, think you can raise your prices if YOUR costs go up. Wal-Mart calls all the shots there too. In fact, they completely changed the push-pull business model to one in their favor, where suppliers line up to make their goods how Wal-Mart wants them, and when, and for what cost to the buyer.

Thanks to China for all the swell, cheap junk stocked on those shelves, too.

[Bluehawk]

Here in Saginaw we have a WM situation rising up that is germaine to this thread.

Everyone knows the economic troubles some parts of Michigan (the automotive industry dependent parts mostly) have been going through in recent years. Saginaw has been, and continues to be, among the hardest hit by all that stuff. We have one of those 21 Delphi plants under threat of closure, and our big automotive foundries are all but dead.

There are about 60,000 people living here. The town is geographically and demographically, for all intents and purposes, divided in half by a river. On one side is the upwardly bound and mobile class (mostly anglo), and on the other is, basically, the 46% of our population who are "blacks".

On "their" side of town is where the major factories etc are or used to be. That is also where the old downtown, now all but a ghost town, and a lot of the historically huge manor houses are, or were.

On the other side of town is where, wayyyyyyy out there in the burbs, our two existing WalMarts have been built.

It so happens that there is an enormous now empty big box on "their" side of town, just begging for a WalMart... and there is some noise being made here lately about seeing to it that the place is renovated to become what is likely to be a very prosperous WM location.

The difference it would make to "their" side of town has to do with such simple stuff as gas mileage... i.e. the difference between being able to drive a mile or two versus ten or more so as to take advantage of those everyday low prices... not to mention certain community-based shelf stocking decisions.

WalMart's position on this potential appears to be that first they must renovate one of the two stores on the other side of town (which seems perfectly functional to me already), and then examine their projected saturation profiles for this region before getting serious, if ever, about the empty big box, whilst dispassionately watching just how sweetened the "pot" is gonna become. Good business strategy, not so good political strategy?

I'm thinking they oughta be humping butt to build that store out in that particular spot, and spots of THAT kind elsewhere in America, with a tad more urgency than they normally do... if they hope to keep their spot in the top 5 Fortune 500. What irritates so many (myself included) is that WM seems prepared to do everything short of eminent domain on ANY community to put a big box exactly where their business models recommend (usually ignoring wails of protest), but not where a store of that kind might actually serve to revitalize (versus take advantage of) enormously important communities.

A new facade, or a nicer loading dock, or fresh paint, or an upgraded fuse box is not a priority when set against the strong probability that people who would actually APPRECIATE having everyday low prices near-at-hand are crying out for some corporate common sense.

There was a time in America when General Motors, Ford and Chrysler took the view that their invincibility in worldwide market share was insurmountable.

Oops!

[Scrappy]

Wal-Mart critics dismissed the new program as a publicity stunt.
"Rather than address the serious issues of unaffordable health care, poverty wages, crime, and sprawl, Wal-Mart's latest and greatest public relations stunt is to try to rebuild a fraction of the very communities and small business it has helped destroy," said Chris Kofinis, spokesman for WakeUpWalMart.com, a campaign group funded by the United Food and Commercial Workers union.

I do believe they are correct in their assessment. Their business model is to place stores in places with relatively low initial cost (both in taxes and property cost) pulling their customer base away from the traditional market place to itself on a simple cost based motivation.

Originally Posted by Bluehawk

I'm thinking they oughta be humping butt to build that store out in that particular spot, and spots of THAT kind elsewhere in America, with a tad more urgency than they normally do... if they hope to keep their spot in the top 5 Fortune 500. What irritates so many (myself included) is that WM seems prepared to do everything short of eminent domain on ANY community to put a big box exactly where their business models recommend (usually ignoring wails of protest), but not where a store of that kind might actually serve to revitalize (versus take advantage of) enormously important communities.

From all you've given us, I can believe wallyworld is disingenuous in its altruism. I have not followed much about the labor situation with walmart, but I do know that pretty much every major retailer in the US relies on using mostly part-time workers. That is pretty much the status quo for using clerks and stockers.

Something that Danny brought up

Originally Posted by odannyboy

Wal-Mart calls all the shots there too. In fact, they completely changed the push-pull business model to one in their favor, where suppliers line up to make their goods how Wal-Mart wants them, and when, and for what cost to the buyer.

Gets me fired up. Unfair business practices towards the suppliers of wallyworld. It may be legal, but it's not right. Because of the their size they can make and break (relatively) small manufaturers. There are two tactics that they use.

One is that they negotiate with one manufacturer (usually the only one that can produce the widget without major start-up costs) for the widget at a certain price/unit. That manufacturer begins making the product, and wally comes back with them saying their cost is to high the price/unit must come down after thousands if not tens or hundreds of thousands have already been made (even some delivered). With the threat of having either a lower or no profit margin, or a loss to the manufacturer, or having thousands of widgets that they would have to sell to someone else, the supplier usually caves (they don't have the clout to make walmart stick to it's initial offer).

The second is that walmart pits manufacturers against one another initially, which on the surface seems fair. Still, they make multiple contracts with several suppliers, with the intent of cancelling one or two (legal in the writing of the contract). Upon cancellation the suppliers have to come to them asking walmart to sell their product (inevitably at a loss to the supplier). Seems a lot like the first, but more sinister, less blatant, and looks like the normal business model of market supply and demand. Instead, it's creating a artificial demand which suppliers attempt to fill, and then the falsely inflated demand drops, the suppliers eat the cost with only walmart reaping any benefit. The company has turned into a shark.

It is a good call to say they've changed the business model (much like what Microsoft did in the software industry). There are many companies stung by wallyworld, some who won't do business with them, and few out of business, and from my understanding some of these were US based, and some Mexican based buisnesses. Oh well, there is a lot to be said for low prices, and that is how the new model works. The only other industry I know of that used to be able to do that was some of the auto manufacturers.

As far as dealing with China, I hate dealing with china as a supplier, they never will admit they screwed up in manufacturing a component/part. They'll get it right once it's brought to their attention, but back charging them for bad parts is like pulling teath (ha, I guess I don't work for Walmart ) and shipping it back is so dang costly.