Wal-Mart environmentalism

By alternet
October 30th, 2008             [back to top]    

Want to understand why so many American workers find it so hard to organize unions in their workplaces? Look no further than Wal-Mart, a researcher for Human Rights Watch says.

Wal-Mart is a case study "of the abysmal workers' rights regime we have here in the United States," said Carol Pier, senior researcher on labor rights and trade for Human Rights Watch, an independent, nongovernmental organization that investigates human rights violations around the world.

In a speech last week at the University of Minnesota, Pier described her two-and-one-half-year study of Wal-Mart's labor-management record, which culminated in a 210-page report, issued in 2007, titled "Discounting Rights: Wal-Mart's Violation of U.S. Workers' Right to Freedom of Association."

The report found that while many American companies use weak U.S. laws to stop workers from organizing, the retail giant stands out for the sheer magnitude and aggressiveness of its anti-union apparatus. Many of its anti-union tactics are lawful in the United States, though they combine to undermine workers' rights. Others run afoul of soft U.S. laws.

"I like to think about it as a 'death by small cuts' strategy," Pier told the audience gathered at the University of Minnesota Law School. "And the effect is devastating."

In the course of her research, Pier interviewed dozens of current and former Wal-Mart "associates" (the term the company uses for its employees) and supervisors in six states and pored through thousands of pages of material from the National Labor Relations Board, the federal agency that enforces U.S. labor law.

Wal-Mart uses a subtle form of union-busting that starts with new employee orientation, where training includes watching an anti-union video, Pier said. The corporation has a 24-hour hotline for managers to report any signs of union organizing activity and a "labor relations team" is quickly dispatched to assess the situation.

Depending on the level of union activity, workers may be subjected to mandatory "captive audience" meetings where they are lectured on the evils of unionism. In some stores, Wal-Mart has crossed the line from subtle to heavy-handed by conducting surveillance on employees, disciplining and firing some.

When those actions are taken – clearly in violation of U.S. labor law – the failings of the system become clear, Pier said. Wal-Mart takes advantage of the exceedingly slow NLRB process to draw out cases for years. When a worker finally wins a case, the company faces no penalty – other than the requirement to reinstate the worker with back pay (minus anything he or she earned in other employment) and to post a notice saying "they won't do it again."

With nearly 1 million employees in the United States, Wal-Mart is the country's largest private employer. Yet none of these workers belongs to a union. Employees at two stores in Quebec, Canada, finally won union representation, but both stores have been closed – the second one earlier this month.

The International Labor Organization has cited the lack of penalties – and the fact that workers can be "permanently replaced" if they strike – as reasons that U.S. labor law fails to meet international human rights standards, Pier said.

The proposed Employee Free Choice Act – supported by Democratic presidential candidate Barack Obama and many Congressional Democrats – would address some of the shortcomings in U.S. labor law by levying fines of up to $20,000 for each violation and permitting workers to choose union representation by signing cards, bypassing the drawn-out NLRB election process during which many employer violations occur.

Still, Pier worries the new law would not be effective without a broader campaign to improve people's knowledge of unions. Companies like Wal-Mart could still continue the kind of early union-busting – such as showing videos during employee orientation – that create a chilling climate for organizing.

"EFCA will help," Pier said of the proposed legislation. "EFCA's necessary. I don't think it's the fix."

Pier's talk was sponsored by The Institute for Global Studies and the University of

Minnesota's Human Rights Program and co-sponsored by the Labor Education Service, publisher of Workday Minnesota.

For more information

Read Pier's report, "Discounting Rights: Wal-Mart's Violation of U.S. Workers' Right to Freedom of Association," http://hrw.org/reports/2007/us0507/.

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Sam's Club to open store to cater to Hispanics

Associated Press
10.28.08                                  [back to top]    

NEW YORK - Executives at Sam's Club, Wal-Mart Stores Inc.'s warehouse club division, told investors Tuesday that the company plans to open a new Mas Club store that sells products imported from Mexico to cater to Hispanic customers.

"Mas" means more in Spanish.

The news - announced on the second day of Wal-Mart (nyse: WMT - news - people )'s annual investors meeting in Bentonville, Ark. - come as Sam's Club is studying different store formats in a bid to expand its business amid a challenging environment.

Doug McMillon, Sam's Club president and chief executive, told investors that membership income is not growing as fast as sales. As a result, executives are focusing on improving offerings while trying to better communicating its value message to members.

Sam's Club officials noted that while food sales have been strong, general merchandise sales remain challenging.

This past summer, Sam's Club began testing a new concept called Sam's Club Business Center in Houston, which caters only to small business owners. McMillon said that at the new format, which does not have such categories as jewelry and pharmacy, business is beating the sales plan. Sam's Club executives also told investors that they are testing a smaller format for both small business and average consumers in Garden City, Kan. This 100,000-square-foot format would allow Sam's Club to move into smaller markets.

Mas Club will sell produce, meats and Hispanic food, drink, spices and candy. It will also have a full-service meat and seafood counter, an event area, a gas station and a cafe that will sell fresh-made tortillas. The store is scheduled to open during the first half of 2009 in Houston. Customers will have to buy separate memberships to Mas Club.

Copyright 2008 Associated Press. All rights reserved.

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Wal-Mart U.S. CEO Says Cutting U.S. Store Openings

Progressive Grocer
Oct 28, 2008                          [back to top]    

Wal-Mart Stores Inc. is throttling back on U.S. store openings and cutting back on overall capital spending, instead seeking to boost sales at existing locations by remodeling stores and improving selection. That was the message at the retailer's yearly analysts' meeting on Monday.

Eduardo Castro-Wright, president and c.e.o. of Wal-Mart U.S., said the division plans to open 191 stores in the current fiscal year, which ends in early 2009; and 142 to 157 stores in fiscal year 2010, compared to 218 U.S. stores in fiscal 2008.

Wal-Mart also plans $5.8 billion to $6.4 billion in capital expenditures this fiscal year for its U.S. division, down from $9.1 billion last year.

In fiscal year 2010, it plans to spend $6.3 billion to $6.8 billion, Castro-Wright said.

Wal-Mart's efforts to manage its balance sheet and capital spending more conservatively in recent years are now paying off with low interest rates in the tight market for short-term corporate credits, the company said. Wal-Mart has borrowed several hundred million dollars in the last several weeks in the commercial paper market as it readies for the holiday season at an interest rate of "substantially less" than 2 percent, Lee Scott, Wal-Mart Stores Inc.'s c.e.o., said.

The giant retailer said it is attracting more higher-income shoppers thanks to the stressed economy. Traffic at stores serving households with incomes above $65,000 has been growing much faster than at the chain as a whole.

Scott stressed that "Christmas will come on Dec. 25" in spite of the economy and said Wal-Mart will have the best prices in the market for the holiday season. He also said that in tough economic times, shoppers want to "treat their families right" when they can, and that this was evident in sales of children's apparel and Halloween costumes

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Blumenthal Targets Wal-Mart On Sales Tax

By George Gombossy,
The Hartford Courant
October 28th, 2008                          [back to top]    

Saying that Wal-Mart is violating state tax laws when requiring customers to pay a second sales tax on exchanges, state Attorney General Richard Blumenthal has instructed the giant company to conduct a review of its practices and take remedial action.

"Wal-Mart should refund any consumer who was denied a refund of sales tax on returned goods or charged a sales tax on even exchanges," Blumenthal wrote to Sam Reeves, Wal-Mart's division general counsel.

Blumenthal based his letter on complaints I have received from Wal-Mart customers and have published in both my Watchdog columns and on my blog this month at www.courant.com/ctwatchdog. Blumenthal included in his letter to Reeves a copy of the Oct. 23 Watchdog column.

Wal-Mart has insisted that its policy is to follow state tax laws, but has so far refused to discuss the issue other than making that blanket statement.

Spokesman Dan Fogleman said Monday evening that although he has no idea what Connecticut sales tax law is, his company is following it.

"This is a complex issue," he said, adding that Connecticut tax officials clarified the law for the company three years ago, and Wal-Mart is following it.

To Blumenthal the issue does not appear complex.

In his letter sent Friday night, Blumenthal told Wal-Mart that only the original sales tax can be charged when a customer exchanges the item for another, even if there is no receipt.

I have received complaints from customers who have shopped at 10 Wal-Mart stores in Connecticut where they were charged a second sales tax when they took merchandise back for an even exchange.

A second tax on the new item was charged even when customers could prove with a credit card statement that they had purchased the item there and could prove they had paid tax on the original item.

I went to the East Windsor store, where I was told that it was the company's policy to require that sales tax be paid again on the new item because Connecticut law demands it.

State Consumer Protection Commissioner Jerry Farrell Jr. is also looking into the issue.

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Wal-Mart Pulls Eggs From Stores In China Over Melamine Scare

Dow Jones Newswires
October 28th, 2008                          [back to top]    

SHANGHAI (AFP)--Wal-Mart Stores Inc. (WMT) is pulling a major brand of eggs from its stores in China as a precaution after the chemical melamine was detected in eggs in Hong Kong, a spokeswoman said Tuesday.

Wal-Mart has begun removing Kekeda brand eggs, produced by Hanwei Group, from its Chinese stores, said Mu Mingming, a spokeswoman at the company's national headquarters in Shenzhen.

"Over the past few days, we pulled this brand of eggs off shelves in all our outlets in China," Mu said.

Wal-Mart, the world's largest retailer, made the decision after Hong Kong authorities announced over the weekend that melamine had been detected in Kekeda eggs.

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Wal-Mart cutting U.S. store openings further

By Brad Dorfman
and Nicole Maestri,
Reuters
October 27th, 2008                 [back to top]    

CHICAGO/NEW YORK, Oct 27 (Reuters) - Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research, Stock Buzz) will slow the pace of U.S. store openings and cut back on capital spending, aiming to boost sales by remodeling existing stores and improving its merchandise selection.

The world's largest retailer also said on Monday that it is attracting higher-income shoppers with discounts as the U.S. economy reels from tighter credit, mounting job losses and falling home prices.

Traffic at stores serving households with income above $65,000 has been growing much faster than at the chain as a whole, Wal-Mart U.S. President and Chief Executive Officer Eduardo Castro-Wright said at the retailer's annual analysts' meeting, which was broadcast over the Internet.

"What that means is we are seeing a lot of new customers that did not consider Wal-Mart before, that consider Wal-Mart now," Castro-Wright said.

Wal-Mart is holding its annual two-day analyst meeting in Bentonville, Ark. Its U.S. business is making a comeback after the retailer saturated markets with stores and saw slower growth in recent years.

Cash-strapped shoppers are increasingly heading to its stores for low prices for necessities, such as food and medicine.

Wal-Mart is also benefiting from efforts started in 2006 to slow aggressive expansion plans and focus on improving U.S. sales. After its sales at existing U.S. stores rose 1.4 percent last year -- its lowest annual result in history -- sales have rebounded and gained 2.9 percent through September.

Analysts are watching to see if Wal-Mart can keep its momentum going amid the threat of a global recession. While Castro-Wright provided an update on its U.S. business, Chief Financial Officer Tom Schoewe is expected to outline expansion and capital spending plans for the entire business on Tuesday.

The company's shares closed down 3.4 percent at $49.67

SLOWING NEW U.S. STORES

Wal-Mart's U.S. division plans to open 191 stores in the current fiscal year, which ends in early 2009, and 142 to 157 stores in the next fiscal year, Castro-Wright said. The company opened 218 U.S. stores in fiscal 2008.

Wal-Mart also plans $5.8 billion to $6.4 billion in capital spending this fiscal year for its U.S. division, down from $9.1 billion last year. In fiscal 2010, it plans to spend $6.3 billion to $6.8 billion, Castro-Wright said.

While it reduces overall capital spending, it is putting money toward remodeling stores.

Castro-Wright said the retailer has seen dramatic improvement in its electronics department, where it has done extensive renovations, bringing in name-brands products and expanding space for shoppers to test out video games.

"We're going to increase investment behind remodels so that we can bring all of our fleet up to the same standard as fast as we can," Castro-Wright said.

Joseph Feldman, a retail analyst with Telsey Advisory Group, liked Wal-Mart's decision to shift some capital spending toward remodeling its stores.

"The upgraded store base should generate greater productivity and more satisfied customers due to the more enhanced shopping experience," he said in an email.

Wal-Mart, known for its massive supercenters that combine a full discount store with a grocery store, is also looking at building smaller stores and "fine-tuning" its merchandise.

For instance, it has increased its offering of pet products and beauty care items to draw more frequent trips by shoppers.

"We're becoming a pet care provider, as opposed to a pet food merchant," said John Fleming, its chief merchandising officer.

CONSERVATIVE EFFORTS PAY OFF

To win business in the tough economy, Wal-Mart has been touting its low prices. Wal-Mart Stores Inc CEO Lee Scott, who stressed that "Christmas will come on Dec. 25" despite the economy, said that Wal-Mart will have the best prices in the market for the holiday season.

He said that, in tough economic times, shoppers want to "treat their families right" when they can and that this was evident in sales of children's apparel and Halloween costumes.

Scott also said efforts to manage the company balance sheet and capital spending more conservatively in recent years are now paying off, with low interest rates in the tight market for short-term corporate credit.

In the last several weeks the company has borrowed several hundred million dollars in the commercial paper market as it readies for the holiday season at an interest rate of "substantially less" than 2 percent, Scott said.

The average rate for commercial paper was 1.96 percent in the week ended Oct. 24, down from 2.12 percent a week earlier, the U.S. Federal Reserve said. (Editing by Leslie Gevirtz and Andre Grenon)

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Labor activists, retailer clashing

By STEVE PAINTER,
Arkansas Democrat Gazette
October 26th, 2008                            [back to top]    

Wal-Mart Stores Inc. is sparring with a small laborrights group that says it has documented worker abuse at a garment factory in Bangladesh that helps supply the Bentonville-based retailer’s stores.

SweatFree Communities says its report “Sweatshop Solutions: Economic Ground Zero in Bangladesh and Wal-Mart’s Responsibility” is based on interviews with more than 90 workers. Those workers, the report states, cite instances of co-workers being kicked or slapped for minor infractions, including one claim that a pregnant woman miscarried after being kicked by a line supervisor.

When Wal-Mart inspects the plant, the report contends, factory managers know ahead of time and workers are coached on what to tell the inspectors.

Wal-Mart said it could not confirm any of the allegations; the company did make an unannounced inspection of the plant in August before the expected release date of the SweatFree report. The company said it offered to work with the labor-rights group in an attempt to verify the allegations and end any potential abuse in exchange for not releasing the report.

SweatFree Communities first contacted Wal-Mart via e-mail June 13 about a report that purported to document worker abuse that dated back several months, the company said.

“It surprised us that Sweat-Free waited nine months to advise us that they conducted interviews which suggested ‘a particularly abusive factory’ and ‘one of the worst in this export industry intensive area,’ as quoted in the report,” Wal-Mart said in a statement e-mailed by Richard Coyle, senior director for international corporate affairs.

Kathryn Ward, a sociology professor at Southern Illinois University at Carbondale who has been studying the lives of Bangladeshi women, including many garment workers, since 2000, said she wasn’t surprised at the working conditions described in the report.

“What they found is a very common thing in Bangladesh,” she said, but added, “Not all the garment factories are what I would call sweatshops.” Despite pay levels that are extremely low by the standards of developed nations — the minimum wage is about $ 24 a month — the garment industry jobs are important to the economy of Bangladesh, Ward said. As the largest buyer of garments in the region, she said, Wal-Mart could set a higher standard for pay and working conditions.

“They could be much more a leader in doing the right thing in Bangladesh,” she said.

At a conference in Beijing on Wednesday, planned long before the report was released, Wal-Mart said it intends to require importers and suppliers of private-label and nonbranded products to identify the name and location of each factory in the supply chain, and that by 2012 it will require suppliers to produce 95 percent of their goods from factories that rate highest on the company’s environmental and social standards. “Make no mistake. We expect from suppliers a firm commitment to meet social and environmental standards,” H. Lee Scott, Wal-Mart’s president and chief executive officer, said at the conference. Suppliers who fail to meet the company’s standards will be barred from future Wal-Mart business, he said.

TWO SIDES ENGAGE Wal-Mart said a company executive first spoke by phone with Bjorn Claeson, executive director of SweatFree Communities, on June 27, and that subsequent discussions led to an Aug. 12 memorandum of understanding between the two parties.

Wal-Mart said it agreed not to order from the factory while it investigated the allegations and corrected any violations of the company’s supplier standards. In return, the company said, Claeson agreed not to release the report until at least Aug. 31.

But by Aug. 20, according to the timeline Wal-Mart supplied, a reporter from Business Week magazine contacted the company seeking comment on a draft of the report.

Wal-Mart said it sent inspectors into the factory unannounced Aug. 14 and interviewed about 30 workers the next day.

Claeson acknowledges releasing the draft to Business Week. But he says the group expects Wal-Mart to abide by the conditions of the memorandum. He said that, based on the group’s inspection of U. S. port import / export records, Wal-Mart’s business accounts for more than 80 percent of production at JMS Garments, the factory in question. “They certainly have the clout and wherewithal to make dramatic improvement in this factory on their own,” Claeson said. The apparel his group tracked arrived at U. S. destinations from the Port of Chittagong, the city where JMS Garments operates in what is known as an export processing zone, according to the report.

THE ALLEGATIONS Claeson works from Bangor, Maine. National organizer Liana Foxvog is in Florence, Mass., and Midwest organizer Victoria Kaplan is in Goshen, Ind. SweatFree Communities ’ board of directors includes members of several other labor-rights groups. Its focus is persuading governing bodies of schools, cities, counties and states not to spend tax money for materials produced under what the organization deems to be sweatshop conditions. For the Bangladesh report, Claeson said his group worked with a nonprofit organization there, founded by a former garment worker, which educates workers about their rights under the laws of Bangladesh.

The group’s name in the report, Garment Research Group, and the names of all workers are pseudonyms to conceal their identities from factory supervisors, he said. Pictures of two Bangladeshi women appear on a page of the report describing the anonymous workers quoted in the report. On the same page, the report says that “the workers in the photograph below do not work at JMS Garments.” Among the abuses that the research group says workers reported: “Today a supervisor kicked an operator for a little delay in work. And the operator lay down on the ground after the supervisor kicked her.” “If any worker talks with other workers, or makes a mistake, or can’t fulfill the target, managers slap the worker’s neck or throw the spool of thread.” “Maybe the worker is looking back to tell her co-worker something. The supervisor will come and slap the worker for talking.” Workers also reported delays in getting paid and being paid for fewer hours than they worked. Work shifts stretch as long as 19 hours a day at a minimum wage that is currently about $ 24 a month, according to the report. Bangladesh’s low wages have attracted businesses, especially to its export processing zones. And Bangladesh has long been the source of reports of abuse in its garment factories, including a series of hidden-camera investigations by the NBC news show Dateline in 2005.

THE COMPANY RESPONDS In its statement, Wal-Mart said it promptly investigated the latest allegations and engaged a third party to assist management in future operation of the factory. “We honored our commitments and engaged in confidential discussions as when SweatFree first contacted us. We continue to work with the factory and we pledge to work with other parties who are truly interested in improving work conditions,” the company said.

Wal-Mart said one of the plant’s owners flew to Bentonville on Aug. 21 to meet with the company’s ethical standards team. The next day, the company said, it held a conference call with SweatFree and offered to form a coalition with the group, other retailers, trade associations and apparel companies using the JMS factory to “bring systemic change to the garment industry in Bangladesh.” But the company said it continued to question the accuracy of the SweatFree report, and told the organization it would not create the partnership if the report was published, according to Wal-Mart’s statements. Since SweatFree Communities released the report, Wal-Mart said, the company has been the subject of an e-mail campaign and “form letters have been filling up the e-mail accounts of several of our executives.” WAGE PRESSURES Ward, the sociology professor, said many garment factories in Bangladesh pass inspections. But subcontractors’ factories that Wal-Mart and other apparel buyers are not aware of often evade inspection, she said. Pressure on manufacturers to keep costs low is constant, she said. “The buyers keep pushing the wages down. If they would pay just pennies more a piece, it would make a big difference in the lives of women workers,” she said.

For her research, Ward has visited Bangladesh eight times, most recently last summer. She estimated that 85 percent to 90 percent of the workers are female, and supervisors are mostly male.

Trina Tocco, campaigns coordinator for the International Labor Rights Forum, said the report is further evidence that Wal-Mart has more work to do to weed out abusive workplace practices at supplier plants.

The Washington-based group has made Wal-Mart, including supplier factories in Bangladesh, a focus of its activities since 2004.

“They need to be given a real clear signal that Wal-Mart is serious about the codes of conduct,” she said. In its statement, Wal-Mart said it conducted 14, 400 audits in 9, 175 factories last year and provided training for more than 10, 100 suppliers and factory personnel. The company also pointed out its role in forming an industry coalition to condemn the use of forced child labor in Uzbekistan. On Sept. 30, the company said it instructed buyers to halt purchases from that nation to pressure the government to ban child labor in its cotton fields. Wal-Mart has changed its recent practice of issuing an annual report on ethical sourcing. It says the next such report will be included with the company’s sustainability report at a date yet to be determined. However, the company says it intends to issue an update in the next few days covering an 18-month period beginning in January 2007.

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Wal-Mart has perfected the art of union-busting, researcher says

By Barb Kucera,
Workday Minnesota
October 26th, 2008                            [back to top]   

MINNEAPOLIS - Want to understand why so many American workers find it so hard to organize unions in their workplaces? Look no further than Wal-Mart, a researcher for Human Rights Watch says. Wal-Mart is a case study "of the abysmal workers' rights regime we have here in the United States," said Carol Pier, senior researcher on labor rights and trade for Human Rights Watch, an independent, nongovernmental organization that investigates human rights violations around the world.

In a speech last week at the University of Minnesota, Pier described her two-and-one-half-year study of Wal-Mart's labor-management record, which culminated in a 210-page report, issued in 2007, titled "Discounting Rights: Wal-Mart's Violation of U.S. Workers' Right to Freedom of Association."

The report found that while many American companies use weak U.S. laws to stop workers from organizing, the retail giant stands out for the sheer magnitude and aggressiveness of its anti-union apparatus. Many of its anti-union tactics are lawful in the United States, though they combine to undermine workers' rights. Others run afoul of soft U.S. laws.

"I like to think about it as a 'death by small cuts' strategy," Pier told the audience gathered at the University of Minnesota Law School. "And the effect is devastating."

In the course of her research, Pier interviewed dozens of current and former Wal-Mart "associates" (the term the company uses for its employees) and supervisors in six states and pored through thousands of pages of material from the National Labor Relations Board, the federal agency that enforces U.S. labor law.

Wal-Mart uses a subtle form of union-busting that starts with new employee orientation, where training includes watching an anti-union video, Pier said. The corporation has a 24-hour hotline for managers to report any signs of union organizing activity and a "labor relations team" is quickly dispatched to assess the situation.

Depending on the level of union activity, workers may be subjected to mandatory "captive audience" meetings where they are lectured on the evils of unionism. In some stores, Wal-Mart has crossed the line from subtle to heavy-handed by conducting surveillance on employees, disciplining and firing some.

When those actions are taken – clearly in violation of U.S. labor law – the failings of the system become clear, Pier said. Wal-Mart takes advantage of the exceedingly slow NLRB process to draw out cases for years. When a worker finally wins a case, the company faces no penalty – other than the requirement to reinstate the worker with back pay (minus anything he or she earned in other employment) and to post a notice saying "they won't do it again."

With nearly 1 million employees in the United States, Wal-Mart is the country's largest private employer. Yet none of these workers belongs to a union. Employees at two stores in Quebec, Canada, finally won union representation, but both stores have been closed – the second one earlier this month.

The International Labor Organization has cited the lack of penalties – and the fact that workers can be "permanently replaced" if they strike – as reasons that U.S. labor law fails to meet international human rights standards, Pier said.

The proposed Employee Free Choice Act – supported by Democratic presidential candidate Barack Obama and many Congressional Democrats – would address some of the shortcomings in U.S. labor law by levying fines of up to $20,000 for each violation and permitting workers to choose union representation by signing cards, bypassing the drawn-out NLRB election process during which many employer violations occur.

Still, Pier worries the new law would not be effective without a broader campaign to improve people's knowledge of unions. Companies like Wal-Mart could still continue the kind of early union-busting – such as showing videos during employee orientation – that create a chilling climate for organizing.

"EFCA will help," Pier said of the proposed legislation. "EFCA's necessary. I don't think it's the fix."

Pier's talk was sponsored by The Institute for Global Studies and the University of Minnesota's Human Rights Program and co-sponsored by the Labor Education Service, publisher of Workday Minnesota.

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WAL-MART INSISTS ON TAXING EXCHANGES

By George Gombossy ,
Hartford Courant
October 23rd, 2008                              [back to top]   

Despite complaints from customers of its stores throughout Connecticut, Wal-Mart insists that it's following state tax laws by requiring them to pay tax again on exchanges made without receipts.

My conclusion is that not only is Wal-Mart violating state laws by charging tax again without receipts, but is letting its employees falsely blame the state. But you be the judge.

The law seems clear:

"When a retailer exchanges or replaces taxable merchandise with identical or similar merchandise for no additional consideration because of a defect or because the item is otherwise unsatisfactory to the customer, no additional sales tax is due from the customer regardless of whether the customer is unable to produce the original sales receipt or other verification of the date and place of purchase, and/or the exchange or replacement takes place more than 90 days after the original retail sale," the state Department of Revenue Services states in its 2005 ruling.

The state tax department - which refuses to say whether Wal-Mart is violating its laws - says the critical question is whether a store has an even exchange policy.

"If a retailer allows even exchanges, then sales tax should not be charged on the second item," department spokeswoman Sarah Kaufman wrote me this month when I asked similar questions about Home Depot.

Wal-Mart says on its website: "You can replace, exchange, or get credit for an item immediately in a store, pending product availability."

A Wal-Mart spokeswoman refuses to discuss the issue, despite several requests for clarification about its policy:

"George, I believe I've answered your question already, but I'll gladly do it again. Walmart's policy is to satisfy the customer and follow the law. Thanks again," Ashley Hardie, Wal-Mart spokeswoman, wrote me in an e-mail.

We probably aren't talking about a lot of money here and the second tax goes to the state, but customers who are charged the additional tax are furious.

During the past two weeks I have had written complaints from customers who shopped at Wal-Mart stores in Manchester, Cromwell, East Windsor, Torrington, Norwalk, Willimantic, North Windham, Newington and Southington.

Shirley Cleveland of Newington wrote me that a month ago she purchased a toaster from Wal-Mart in her town, but returned it after learning on a television news program that it was defective and could start a fire.

She returned to the store without a sales slip, but took her charge statement from her credit card account.

"I asked for a credit on my credit card and was refused, they would only give me a gift card and would not credit me the tax I paid. The amount was only under two dollars but it's in someone's pocket not mine," she wrote me.

Another customer, C. William Lee of Wethersfield, said he and his wife were told by a Wal-Mart manager Saturday in the Newington store that there can be no tax refund if cash was used, even though they had a receipt.

I went to the East Windsor Wal-Mart this week and confirmed what others have told me, that employees who work at the return desk say that state law prevents them from returning sales tax on an even exchange without a receipt.

On Friday, a spokesman for Gov. M. Jodi Rell said she believes that consumers shouldn't needlessly pay double taxes and would have the tax department review the issue.

But, since it's the Consumer Protection Department that is supposed to enforce return and exchange laws, the hot potato has been dropped into Consumer Protection Commissioner Jerry Farrell Jr.'s lap, to determine whether stores are properly charging taxes on exchanges.

Based on my dealings with Farrell, I think we will have a fair decision.

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Wal-Mart sets new rules for China suppliers

By AUDRA ANG
Associated Press
10.22.08                     [back to top]  

BEIJING - Wal-Mart Stores Inc., the world's largest retailer, said Wednesday it will set new quality standards for its suppliers amid a scare over toxic milk products that have sickened tens of thousands of babies across China.

Meanwhile, the United Nations released a report that recommends China increase oversight of its food safety system and hold businesses accountable for their products.

Mike Duke, vice chairman of Wal-Mart (nyse: WMT - news - people )'s international division, said the company is expecting "greater transparency ... from our supplier partners" beginning next month.

They will be required to "tell us the name and location of every factory they use to make the products we sell," according to Duke's prepared remarks delivered at a company conference in Beijing. "Essentially, we expect you to ask the tough questions, to give us the answers and, if there's a problem, to own the solution."

Wal-Mart will apply the new standards to apparel first and eventually use them on all its products, Duke said. No other details were given.

The measures by Wal-Mart, China's largest foreign retailer, come as confidence in Chinese exports has been shaken after a series of product safety scandals.

Last year, high levels of industrial toxins were found in exports ranging from toothpaste to toys.

China is still reeling from the revelation last month that the chemical melamine, which is used to make plastics and fertilizer, was added to infant formula to artificially boost nitrogen levels and make it seem higher in protein when tested. The deaths of four babies have been linked to the practice and some 54,000 children have been sickened.

Contamination has since turned up in powered and liquid milk, yogurt and other products made with milk. Dozens of countries have pulled Chinese-made goods with dairy ingredients off their shelves to test for melamine.

Health experts say ingesting a small amount poses no danger, but in larger doses, the chemical can cause kidney stones and lead to kidney failure.

Wal-Mart sold Chinese-made cribs which were part of a recall this week by New York-based Delta Enterprises. The 600,000 cribs of various models with spring-loaded safety pegs were manufactured in China and sold between January 2000 and January 2007.

Another 985,000 cribs were recalled because of the potential for missing safety pegs. Those products were manufactured in Taiwan and Indonesia and sold between January 1995 and September 2007.

The recall was instituted after the deaths of two babies.

In its report released Wednesday, the United Nations recommended that China tighten oversight focusing on high-risk areas of the food chain, have an all-encompassing food safety law that would cover the whole industry and hold businesses responsible for the products they sell.

"The national system needs urgent review and revision," U.N. Resident Coordinator in China Khalid Malik said.

Additionally, China needs a unified regulatory agency, the report said, and a place consumers can go for reliable information. The task is currently split between different government agencies, creating uneven enforcement that is further complicated by numerous laws.

In the southern Chinese territory of Macau, government officials said late Tuesday that three more children have developed kidney stones, bringing the total number of sick children to seven.

Ultrasounds confirmed the diagnoses in two 6-year-old girls and an 11 year-old boy, Macau government information officer Elena Au said.

The boy is currently hospitalized but the two girls developed small stones and did not require hospital treatment, Au said.

The girls drank milk made by Chinese dairy Yili Industrial Group Co., whose products have been confirmed to contain melamine.

Au said officials are still investigating what brand of milk the boy drank.

Associated Press writer Henry Sanderson in Beijing contributed to this report.

Copyright 2008 Associated Press. All rights reserved

Federal Safety Regulators to Issue Crib Durability Standards

By Annys Shin,
Washington Post
October 22nd, 2008                         [back to top]  

After two infant deaths triggered the recall of 1.6 million cribs Monday, federal safety regulators are moving to address a longstanding gap in crib safety regulations: durability standards.

The Consumer Product Safety Commission plans to issue new regulations that deal with the hardware problems that have been at the center of five recent crib recalls and contributed to the deaths of at least two other children.

Hardware can become worn down over time, unbeknownst to parents, who often reuse cribs, sell or pass them on -- sometimes without all the parts or instructions. The two deaths -- one in May 2007 and the other in July -- that led to this week's recall by Delta Enterprise of New York City involved used cribs, CPSC spokeswoman Julie Vallese said.

Certain crib parts, such as mattress supports and side rails, are tested to meet durability standards. But the standards need to be more comprehensive and stringent, consumer advocates and federal safety regulators said.

"Voluntary standards for cribs have addressed many safety issues and over the years the agency has seen the number of crib fatalities go down," Vallese said, "but the voluntary standards have failed to address durability issues."

CPSC officials did not say how long it would take to issue a crib durability standard. The agency staff hopes to have a proposal for the commission to review by the end of the month, Vallese said.

Cribs with drop sides are more likely to have hardware problems, the CPSC said. Drop sides can be moved up and down, usually along a track, to make it easier to get a child in and out of a crib. A CPSC analysis of more than 1,000 reports of potential crib failures over the past year found that in many cases the drop-side corners came off the tracks or hardware that is supposed to stop the side from moving failed to work. And the problems can get worse without parents noticing, as a baby pushes or leans against the crib.

Some consumer advocates want drop-side cribs retired altogether.

"I'm not sure the drop-side bar provides enough utilitarian benefit to justify what appears to be an increased risk of strangulation and suffocation," said Alan Korn, director of public policy for Safe Kids USA, a Washington group that seeks to prevent accidental childhood injury and death.

Cribs are governed by mandatory and voluntary standards. For example, mandatory standards dictate the amount of space allowed between slats while voluntary standards issued by ASTM International, an independent standards-setting body based in West Conshohocken, Pa., cover the content of warning labels and the height of corner posts.

Consumer advocates have tried unsuccessfully for much of the past decade to get ASTM to develop a more comprehensive durability standard, said Donald Mays, senior director of product safety for Consumers Union.

Underwriters Laboratories, an independent product safety testing and certification organization based in Northbrook, Ill., has developed a "rocking test" in which a crib is shaken tens of thousands of times using weights in order to better simulate real-life use by children who jump and rattle their cribs. Canada has a similar test. But so far, no crib manufacturers have asked UL to test their products using that method, said UL spokesman John Drengenberg.

The Delta recall was the fifth in the past year involving hardware that was broken, missing or failed to function, according to the CPSC. Delta recalled 600,000 cribs made before 2006 and sold between January 2000 and January 2007 because of problems with a spring-loaded peg at the bottom of the legs that can cause the drop side to come off and create a gap into which a child can fall and suffocate. In July, an eight-month-old boy in Tallahassee, Fla., died in a Delta crib. A spring-loaded peg apparently failed and the drop side detached.

Delta recalled another 985,000 cribs made between 1995 and 2005 and one model made in 2007 that used a different type of peg. If the pegs are missing, the drop side can come off, creating a suffocation hazard. In May 2007, an eight-month-old girl from Bryan, Tex., died in a used Delta crib that had been reassembled without the pegs, Vallese said. The cribs were sold at major retailers, including Wal-Mart, Kmart and Target.com, from January 1995 through September 2007.

Hardware problems and detached side rails were also involved in the deaths of at least two children in cribs made by the now-defunct Simplicity of Reading, Pa., which led to a recall of 1 million cribs.

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Wal-Mart pushes global suppliers to new standards

By Kimberly Morrison,
THE MORNING NEWS
October 22nd, 2008                    [back to top] 

Wal-Mart Stores Inc. on Wednesday outlined new rules for its international suppliers -- starting with China -- to adhere to higher environmental and safety standards.

The global responsible sourcing initiative requires Wal-Mart's worldwide supply chain to comply with local environmental laws as well as incorporate some of the retailer's own green initiatives, sets a higher standard for product safety and mandates greater transparency.

The retailer announced in Beijing at a gathering of more than 1,000 suppliers and officials that the company intends to start in January with Chinese manufacturers and suppliers to Wal-Mart stores in the U.S., Canada and the United Kingdom. The program will then expand in phases to include all international suppliers by 2012.

The move follows a wave of product recalls and recurring safety concerns about products made in China, particularly in toys.

"Maintaining the trust of our customers -- today and in the future -- it ties hand-in-hand with improving the quality of our supplier factories and their products," said Lee Scott, Wal-Mart chief executive. "A company that cheats on overtime and on the age of its labor, that dumps its scraps and chemicals in our rivers, that does not pay its taxes or honor its contracts, will ultimately cheat on the quality of its products."

Wal-Mart did not specify its new standards for safety and quality, but said it aims to drive returns of defective merchandise "virtually out of existence" by 2012.

But it is seeking greater transparency in the supply chain, requiring all direct-import, private-label and non-branded product suppliers to provide factory information to Wal-Mart. Within two years, direct suppliers will also be required to source 95 percent of their products from factories that receive top marks in audits for environmental and social practices.

Wal-Mart directly exports about $9 billion from China annually and estimates export volume by third-party suppliers is also around $9 billion, according to the company's Web site.

"With the world's largest population and a robust manufacturing industry, no market presents a greater opportunity for environmental sustainability to take hold than China," said Ed Chan, chief executive of Wal-Mart China.

Wal-Mart plans to improve energy efficiency among its Chinese factories. It has set a goal for the top 200 factories it sources from to achieve a 20 percent improvement in energy efficiency by 2012.

The company plans to cut energy use at its stores, opening a prototype store that requires 40 percent less energy and reducing by 30 percent the amount of energy used at existing stores within two years. It is also cutting water use in half within the same time period.

Other environmental initiatives include bringing more environmentally sustainable products to the store shelves, reducing packaging on all products by 5 percent by 2013 and introducing sustainably harvested produce.

Mike Duke, vice chairman of Wal-Mart's international division, said the retailer will work with suppliers to develop new practices, but was clear that the new standards are not optional.

"Make no mistake, if after a period of time, a factory fails to improve, Wal-Mart will move our business to suppliers who do comply and who do improve," Duke said.

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Wal-Mart customers delay buying necessities

By Lisa Baertlein,
Reuters
October 21st, 2008                    [back to top] 

LOS ANGELES (Reuters) - Wal-Mart Stores Inc's U.S. customers, increasingly worried about their own financial security, are waiting until they get their paychecks to buy even the most basic necessities, the retailer's U.S. division head said on Tuesday.

Personal financial security, a recent poll revealed, was the No 1 concern for 80 percent of Wal-Mart shoppers, up from 65 percent a few months ago, said Eduardo Castro-Wright, president and chief executive of the Wal-Mart's U.S. operations.

And, in a "disturbing" trend, Castro-Wright said Wal-Mart for the first time is seeing a paycheck-related spike in sales of baby formula, suggesting consumers are rushing to buy such necessities as soon as they have the cash.

"Most consumers are worried about: 'Will I have enough to put food on the table so my family can eat?" he told attendees of a luncheon sponsored by Town Hall Los Angeles.

He said credit used as a form of payment at Wal-Mart is falling and that the decline is expected to reach into the double digits this year.

U.S. consumers have been cutting spending for months due to falling home values, job losses, higher prices for basics like food and fuel, and a global credit crisis.

Castro-Wright signaled earlier this year that easy access to credit was disappearing and forcing consumers to make changes in their purchasing habits.

On Tuesday he said that many consumers have "maxed out. Credit card limits don't allow them to use credit."

Castro-Wright declined to comment about the general economy. When asked about the holidays, he said: "Christmas is going to come .... consumers are just going to be more cautious."

As the economy worsens, Wal-Mart's customers have increasingly shown signs of living paycheck to paycheck.

Wal-Mart's sales typically surge around pay periods at the beginning and middle of the month. Castro-Wright said that spike has become more pronounced as consumers' budgets become more stressed.

In the last few months, the percentage of overall sales from the days surrounding those pay periods has risen 250 basis points, he said.

Shares in Wal-Mart closed down 1.4 percent to $53.67, off their year-high of $63.40 in September.

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Candidates to Wal-Mart Shoppers: Elect Me. Live Better.

By Virginia Heffernan,
New York Times
October 21st, 2008               [back to top] 

Go to the Wal-Mart’s homepage these days, and up come two videos, one for Barack Obama and one for John McCain. These are the two campaigns’ Wal-Mart-only pitches. Presumably, they reflect what each candidate thinks that Wal-Mart shoppers — regular folk? Flyover folk? Poor people? — want from them. They’re fascinating. The differences between them are fascinating.

Here they are. First up — following the left-to-right order on the site, is Barack Obama. In his tinny-audio video, he’s all alone, talking straight to regular folks about “what we need to do.”

(Spoiler: grow the economy, middle-class tax break, let workers unionize for fair wages and health care, protect pensions, strengthen Social Security, supply health care universally, educate every kid so he can compete globally, make jobs with made-in-America energy initiatives, end the war and quit needing Middle Eastern oil in 10 years.)

Those things we need to do are written so straight, but they’re also very self-assured and respectably specific. (Still, you can’t help wishing that he pulled a Palin-wink when he mentioned organizing workers.) They’re under the rubric of restoring the American dream, which Obama says is slipping away.

Next up, John McCain. His is one of his extra-lush campaign videos, beginning with the young P.O.W. McCain barely choking out his name and turning to voiceover thereafter. In fact, you never hear from the candidate again. His “video” is in fact a slide show with fades — no moving pictures — and it’s elegantly produced, unlike Obama’s video, which almost looks as if it were shot in a Wal-Mart itself.

McCain doesn’t say anything just for Wal-Mart; he hits the melodrama of his “common-sense conservative” character. He’s tough; he’s a fighter; he “abhors waste” (like bargain shoppers?); he evinces “a faithful, unyielding love for America.” The big strings section surges. The audio trounces Obama’s. Where Obama’s surprise step is to renounce production values, McCain’s video’s weirdest quality is its superstitious streak: “The stars are aligned. Change will come.” Wha—?

And “What good fortune that America will choose this leader at precisely this time.” Will choose? Voters, you are getting sleepy. … Does this kind of salesmanship work on anyone anymore? Did it ever?

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Wal-Mart Launches Presidential Candidate Videos for Shoppers, Associates

PRNewswire-FirstCall
October 20th, 2008                      [back to top] 

BENTONVILLE, Ark., Oct. 20 // -- As part of its continuing effort to engage customers and associates in this year's presidential election, Wal-Mart Stores, Inc. (NYSE: WMT) today launched a video-based voter guide enabling both major candidates, Sen. Barack Obama and Sen. John McCain, to share their views on key issues with Wal-Mart customers and associates. Through the company's Web sites, both major candidates will present their views on issues beginning today through Election Day to the 136 million Wal-Mart customers who shop its stores weekly and the 1.4 million associates who serve them.

"We know that, like most Americans, our customers and associates are concerned with a number of important issues, including health care and the environment, with the economy at the top of the list," said Leslie Dach, Wal-Mart's executive vice president of corporate affairs and government relations. "As so many pollsters have pointed out, the 'Wal-Mart Mom' is at the center of the election and we're pleased to offer Sen. Obama and Sen. McCain the opportunity to speak directly to her through these videos."

Two videos from each campaign are available on four Wal-Mart Web sites. The video-based voter guide will enable the candidates to introduce themselves to customers, club members and associates, detail their plans and positions on key issues, and will reflect the candidates' campaign platforms in a nonpartisan manner.

The videos will be accessible through http://www.walmart.com, one of largest e-commerce sites in the nation; http://www.samsclub.com, a leading online membership e-commerce site; and, http://www.walmartstores.com, the company's corporate Web site. Collectively these sites average tens of millions of visitors each week. The videos also will appear on a Web site for the exclusive use of the company's 1.4 million associates in the United States. The Web sites will provide information about other presidential candidates, as well.

"We thank Sen. McCain and Sen. Obama for sharing their views on these key issues with our customers, club members and associates so they can make an informed decision and have their voices heard on Election Day," said Mr. Dach.

The company plans to alert customers and associates of this unique internet offering through public service announcements that will air beginning today on Wal-Mart's in-store television network.

This continues the company's efforts to educate its customers and associates about the upcoming election. Earlier this year, the company announced a series of comprehensive programs including a national advertising campaign, a voter registration drive and in-store public service announcements.

Research shows that in today's economic climate Americans are shopping at Wal-Mart more than ever. An August survey conducted by Voter/Consumer Research of Washington, D.C. showed that nearly half of undecided registered voters say they are more likely to shop at Wal-Mart today than they were six months ago.

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Shelby County Commission rejects Wal-Mart Supercenter

By Pamela Perkins ,
Commercialappeal.com
October 20th, 2008                    [back to top] 

After about a year of fighting a tide of angry neighbors and cautious Memphis and Shelby County planners, Wal-Mart has abandoned its quest to put a "supercenter" store at Macon and Houston Levee roads.

"We're done. We're not going to build a store here," Wal-Mart spokesman Dennis Alpert said just after the Shelby County Commission voted 10-3 Monday evening to reverse the Land Use Control Board's July approval of the project.

The vote came on a citizens' appeal. The commission and the Memphis City Council both needed to deny the appeal as stated in a joint resolution for the retail giant to move forward.

The matter is on the agenda for today's City Council meeting. But the commission's vote effectively ended the fight. Commissioners Mike Ritz, J.W. Gibson and Sidney Chism cast the three dissenting votes -- despite the scattering of "No Wal-Mart signs" in a sea of about 100 people who appeared to oppose the supercenter.

Nationally, the retailer has met with opposition in several communities in recent years. Most have cited fears of traffic congestion, increased crime, decreased property values and concern about competition for local businesses.

In some cities, Wal-Mart spends years trying to win approval.

Wal-Mart and some Cordova neighbors wanted the global retailer to put a 151,908-square-foot store, plus about 20,000 square feet of outparcel space, at the intersection's northwest corner.

But city-county planners and a coalition of neighborhood groups called Citizens for a Sustainable Growth -- which asked for the appeal -- believed the facility would be too intrusive and would promote too much traffic at the intersection of the two-lane roads.

The coalition said that although Wal-Mart pledged $2.5 million to widen the roads up to 1,000 feet from the intersection in all four directions, the county would have been compelled to spend taxpayer money to widen the roads even further.

Attorney Brian Stephens, representing the coalition, pointed out that other local supercenters were built on roads already improved enough to support regional traffic.

"The road situation cries out that we vote with the neighbors on this," said Commissioner David Lillard, who represents the area along with Commissioners Wyatt Bunker and Joyce Avery.

"If we're going to wait until the roads are in place, it ain't gonna happen," said Ritz, supporting Wal-Mart. Ritz also said the "second-guessing" scrutiny would scare off developers.

The opposition also said denying Wal-Mart's proposal would be a win for "sustainability," a urban planning buzzword that refers to developing one community without draining the resources of another.

The site is within 7 miles of two other Wal-Mart supercenter stores in Cordova. The retailer said a new store is needed in the area because the other two have a customer overflow.

Stephens also said the store would promote the sprawl that blighted and drained communities such as Hickory Hill. "We can do things a little smarter. We can do things a little brighter," he added.

Attorney Mike Williams, representing Wal-Mart, pointed out that the commission had approved commercial zoning at the site nearly 10 years ago.

He said Wal-Mart has worked hard to appease planners and neighbors since it first applied for the site plan approval in December. The company revised its original application filed in December by shrinking the building's size from 176,305 square feet and repositioning the building further from nearby homes.

It also abandoned its signature blue-and-gray exterior for a mostly brick building with earthtone signs with a new company logo.

Williams said the cash-strapped county would rake in $1 million to $1.4 million in sales tax revenues plus about $240,000 in property tax revenues annually.

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Save the bald eagles from Wal-Mart

David Nassar
Wal-Mart Watch                          [back to top] 

Right now, Wal-Mart is trying to build a new supercenter in Tarpon Springs, Florida -- whether residents like it or not. It turns out the residents aren't only humans. A pair of bald eagles has recently made their nest in a tree right in the middle of the proposed Wal-Mart parking lot. Bald eagles have fortunately been making a comeback in the United States, but they remain a sensitive species and are still protected by the Migratory Bird Act and the State of Florida. The Tarpon Springs City Commission is meeting next Tuesday and Wednesday nights to discuss whether or not Wal-Mart's development certificate is still valid, and if the company has the right to build. Thankfully, Mayor Beverly Billiris told the St. Petersburg Times last week that "Maybe the eagle will settle the whole thing," so we know that the Commission is going to take the issue of the eagles seriously. A little encouragement from environmentally-minded supporters like you might be all it takes to save the eagles. Help make sure that happens. Use our simple tool to send an email to the Mayor and the City Commission urging them to say no to Wal-Mart and yes to bald eagles: http://action.walmartwatch.com/TarponSpringsFL Even though you may not live in Tarpon Springs, your opinion is important to city officials. Tarpon Springs describes itself as 'historic, picturesque, and unspoiled,' and the city counts heavily on tourist dollars. They need to be reminded that the area will be much less attractive to tourists like you if they allow a Wal-Mart to destroy a bald eagle nest and pollute the Anclote River. And before the eagles' nest was discovered last week, there were already major environmental concerns. The retail giant wants to build a 204,000-square-foot store on the river banks. The increased traffic in and out of the store parking lot would lead to a huge increase in stormwater runoff, which would indirectly drain into the Anclote River and eventually into the beautiful saltwater bayous around Tarpon Springs. Local groups, including the Friends of the Anclote and Concerned Citizens of Tarpon Springs, have already stood up in firm opposition to the project. Join them by writing to the city leaders and telling them to stand up to Wal-Mart: http://action.walmartwatch.com/TarponSpringsFL Wal-Mart founder Sam Walton once wrote, "If a community does not want us there, we will go somewhere else." In communities across the country, residents have stood up to Wal-Mart and won. Now it's Tarpon Springs's turn. Tell the City to save the bald eagles and say no to Wal-Mart: http://action.walmartwatch.com/TarponSpringsFL

Sincerely,
David Nassar
Wal-Mart Watch

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Wal-Mart opens stores in China's hinterlands

Associated Press
October 19th, 2008                [back to top] 

LOUDI, China - Maoming, Wuhu and Loudi.

They're Chinese cities so far in the boonies that Lonely Planet doesn't even bother to mention them in its popular travel guide. But Wal-Mart has found them, as the company makes an aggressive push into China's smaller markets.

China's economic growth is rapidly spreading out from the main cities like Beijing and Shanghai into the hinterlands, where the middle class is taking off. In a report last year, the consulting firm A.T. Kearney said 75 percent of the middle market is expected to be in tier-two and tier-three cities by 2017.

These cities are "small" only by the standards of a country with 1.3 billion people. For example, Wuhu in eastern China has 2.3 million people and Maoming in the south has 6.8 million, providing a strong consumer base as incomes rise.

In response, retailers are pushing into the hinterlands, including American coffee chain Starbucks Corp. and French store Carrefour SA. Carrefour, the world's second-largest retailer after Wal-Mart, is the largest foreign retailer in China.

Faced with saturated markets at home, these retailers are increasingly looking to emerging economies such as China to drive sales growth. Wal-Mart's attempt to gain a bigger foothold in China is anchored in smaller cities: Only three of the 30 outlets Wal-Mart Stores Inc. opened in China last year were in Shanghai, Beijing and Shenzhen. The rest were in provincial capitals or other cities.

"I think the capacity for growth in China might exceed that of the U.S., if you look at it in the long term," Terrence Cullen, Wal-Mart's vice president of development in China, said in an interview in his office in Shenzhen, the southern boomtown across the border from Hong Kong.

Wal-Mart said its China sales rose 32.2 percent in the second quarter, while international sales overall were up 16.9 percent.

Risks in smaller markets But experts warn there are risks in smaller markets. People are not as well-off, so it's harder to turn a profit. Local suppliers may be less reliable, a concern in a country plagued by quality scandals, including the recent discovery of contaminated baby formula blamed for killing four infants and making thousands sick.

Moreover, the big-bang growth strategy — opening stores across China — requires a bigger investment than the gradual expansion the company pursued in the U.S.

Two of the newest stores are in Loudi, a steel and mining town of 4 million people in central China. It's just down the road from Shaoshan, the birthplace of late leader Mao Zedong — who would likely be horrified to hear that a flagship of American capitalism has moved into his neighborhood.

At one of the new Loudi Wal-Marts, a woman in blue overalls greets shoppers. The sprawling, brightly lit and spotlessly clean store has the same general look and feel of one of the company's well-stocked, wide-aisled stores in the U.S.

But a few steps inside, it becomes clear that Wal-Mart is trying to deliver everyday low prices with Chinese characteristics.

The smoky scent of thick slabs of dried smoked pork piled high in a display case mixes with that of laundry detergent and plastic. There are foreign brands: Raid roach killer, Head & Shoulders shampoo, Budweiser beer and "pesto Italiano" flavored Pringles potato chips. But there are also bins of reddish-brown dried squid and vacuum-packed packages of preserved Wuchang fish, one of Mao's favorites.

"I come here all the time," said Chen Yatian, a 21-year-old engineering student. "The prices aren't higher than the small shops outside, and I think the quality is better. My friends and I buy all our snacks here, things like spicy dried tofu."

The need to satisfy sharply different regional tastes is one of the challenges Wal-Mart faces in smaller markets, said Dean Xu, professor of strategy and international business at the University of Hong Kong. Wal-Mart will have to source many goods from local suppliers, potentially raising quality issues. "If there is one incident, it can ruin your company's reputation," Xu said.

Still, Wal-Mart's Cullen says the expansion is a logical step as China's middle class swells and the economy becomes driven more by consumers than exports. Major markets have their drawbacks too, he added.

"The big cities are very difficult to do business in for all the obvious reasons: They're crowded. It's difficult to find real estate. It's expensive and there's competition," said Cullen, who previously helped rival Costco Wholesale Corp. break into South Korea and Taiwan.

$3.1 billion in sales In the United States, Wal-Mart started with a single store in Arkansas in 1962 and built up its distribution network slowly, opening stores in adjacent counties and avoiding big leaps, said Emek Basker, a University of Missouri economics professor who has done extensive research on Wal-Mart's growth. The company had a conscious policy to open outlets only within a day's drive of its distribution centers, she said.

Wal-Mart declined to comment on whether it would be scaling back its international expansion plans amid the global financial crisis.

Wal-Mart is being outmaneuvered by Carrefour because its executives have taken too long to understand the China market and add stores, said Burt P. Flickinger III, managing director of retail consulting firm Strategic Resource Group. Carrefour, with $4.3 billion in sales, ranked sixth among all retailers in China in 2007, according to the China Chain Store & Franchise Association. Its sales were up 24 percent over the previous year.

Wal-Mart was 13th, with sales of $3.1 billion, a 42 percent increase over the previous year. The American chain also owns a 35 percent stake in Trust-Mart, which operates about 100 stores in 34 Chinese cities.

At the Wal-Mart Supercenter in Loudi, homemaker Zhang Xiaoling, 32, said the store with the lowest prices would get her business.

"I always come here. I think the selection is great and the prices are fair," Zhang said, as she struggled to keep her 2-year-old son from wandering away. "There was a small supermarket just down the road. When Wal-Mart opened, it closed. It just couldn't compete."

A few blocks away, in the dark and dingy basement of a dilapidated building, most of the merchants at a traditional food market appeared blasé about the new competitor.

Shau Youming, who sells spices and soy sauce in a small stall, said Wal-Mart hasn't hurt his business.

"I've got my old customers and they all live nearby," he said. "It's convenient for them to come here. My prices aren't high and I keep an eye on Wal-Mart's prices. I'm not trying to make a lot of money. Just enough to make a living."

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Factory closure in China a sign of deeper pain

By WILLIAM FOREMAN,
The Associated Press
October 19th, 2008                         [back to top] 

DONGGUAN, China -- Unemployed worker Wang Wenming was angry at his boss for shutting down a massive Chinese factory this week that made toys for Mattel Inc., Hasbro Inc. and other American companies.

But the assembly line worker was also furious at the United States.

"This financial crisis in America is going to kill us. It's already taking food out of our mouths," the 42-year-old laborer said Friday as he stood outside the shuttered Smart Union Group (Holdings) Ltd. factory in the southern city of Dongguan.

The company, which has struggled as global growth has slowed in recent months, employed 7,000 people in mainland China and Hong Kong. It wasn't immediately clear how many have lost their jobs.

Economic upheaval in the U.S. is already changing and shrinking China's vast manufacturing hub in the southern province of Guangdong, long regarded as the world's factory floor. However, factory closures won't just be a China problem _ shoppers will feel the effect in malls and stores in the U.S. and Europe.

"When these companies go bust, the outcome is higher prices," said Andy Xie, an independent economist in Shanghai. "Labor costs have gone up 70 to 100 percent in the last three or four years. But these guys have not been able to raise their prices because Toys "R" Us, Home Depot and Wal-Mart are saying no price increase. How is that possible?"

For years, there were too many factories competing to win bids from foreign buyers demanding prices that were often unrealistically low. The winners were American and European consumers, who enjoyed rock-bottom prices.

But many factories were scrimping on materials and stiffing their suppliers just to survive, Xie said. The financial crisis will be the final culling factor that forces many wobbly factories to go belly up and end an unsustainable situation, he added.

Already, China's toy industry is hurting. The official Xinhua News Agency reported this week that 3,631 toy exporters _ 52.7 percent of the industry's enterprises _ went out of business in 2008. The causes: higher production costs, wage increases for workers and the rising value of the yuan, the report said.

Nor is Christmas likely to make much difference. Big toy giants generally put in their Christmas orders months in advance so toys can be shipped to them in time.

Even before the financial crisis, China's exports were dropping because of the slowdown in America and Europe. For the first time in three years, the growth rate for Chinese exports in the first quarter of 2008 declined, according to customs figures.

Chan Cheung-yau, chairman of toy and games subcommittee under the Chinese Manufacturers' Association of Hong Kong, agreed that the outlook was gloomy for toy makers. He predicted that thousands more factories would close in China next year.

"The tightening credit market has made it more difficult for manufacturers to raise funds," he said. "It has created a huge cash flow problem."

Workers at the Smart Union toy factory said that for several months the plant was less busy and paychecks were arriving late.

"The management said the problem was that our American customers weren't paying for the goods they ordered so the company couldn't pay us," said worker Shao Xiaoping, who was still wearing his blue company shirt with a red patch above the pocket that said "Smart."

He was among 100 workers who on Friday gathered outside the gates of the factory, a sprawling five-story complex covered in white and blue tiles discolored by dust and smog. About 2,000 other laborers protested outside the local government's offices, demanding that the Hong Kong-based company pay their wages, severance and other benefits. The building was guarded by a line of 50 riot police with shields and clubs.

The workers said the Hong Kong-based owner of the factory didn't warn them before the plant closed Wednesday.

"I've been working here for eight years. I have no idea whether I'll ever get paid. The government says we will, but I'm not optimistic," said a man in a white sleeveless undershirt who would only give his surname, Zhang. Most workers wouldn't completely identify themselves for fear speaking to the press would cost them their wages.

A sign posted by the local government on the factory gates said workers could be detained for 10 to 15 days for stirring up unrest, unlawful gathering, protesting and ignoring orders from security officials.

Calls to Smart Union's offices in Hong Kong went unanswered. On Friday, the company said in a filing to the Hong Kong Stock Exchange that it informed Hong Kong's High Court that is has stopped operating and was seeking buyers.

Last year, the company, listed on Hong Kong's stock market, said in a financial report its core customers included Mattel, Hasbro and Spin Master Ltd. The company's stock was suspended from trading Wednesday.

In another report this year, the company reported a pretax loss of US$25.9 million (HK$201 million) in the first six months.

Higher manufacturing costs _ including a 20-percent rise in the cost of plastic _ took a big bite out of profits, along with the 7 percent appreciation of the yuan, it said. The company was also hammered when Mattel and other toy giants recalled millions of Chinese-made toys last year because of safety concerns, the company said.

Although Smart Union wasn't directly involved in those recalls, "the product recall incident badly affected the toy industry," it said.

Most of China's toy factories are in Guangdong province _ the main laboratory for the bold economic forms China began 30 years ago when it began shifting away from communism. The province was a good place to start dabbling with capitalism because it shares a border with Hong Kong, the main gateway into China for foreign investors.

Companies from Hong Kong, Taiwan, America and Europe flooded into the province to set up low-cost factories that made everything from sneakers and bras to laptops and iPods. The booming region close to Hong Kong became known as the Pearl River Delta.

Most of the factory closures are happening in the Pearl River Delta, and the changes didn't seem to bother one of the province's highest-ranking economic officials, Vice Governor Wan Qingliang.

In a briefing with foreign reporters this month, Wan said the global economic crisis wouldn't deter the provincial government from pressing on with a sweeping plan to restructure the Pearl River Delta's manufacturing base. He said the government wanted low-end factories to move farther into China's interior so that they could be replaced with more high-tech, advanced industries.

"We have a policy to empty the cage for the new birds," he said. "The ultimate target is to build the Pearl River Delta into the core region of modern manufacturing."

If the strategy works, China might eventually come out of the toy crisis stronger.

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Wal-Mart initiative qualifies for '09 ballot

Ventura County Star
October 18th, 2008                 [back to top] 

An initiative aimed at preventing Wal-Mart from coming to Ventura will appear on the November 2009 ballot, city officials said Friday.

Supporters of the "Limiting Large Retail Initiative" petition submitted 8,603 valid signatures - many more than the 5,936, or 10 percent of registered voters, needed to make the next regular municipal election but 300 short of the number needed for a special election, officials said.

The Stop Wal-Mart Ventura Coalition wants to block Wal-Mart or any warehouse grocery store from opening in Ventura. Wal-Mart has its eyes on the closed Kmart site off Victoria Avenue.

The initiative would ban any new store larger than 90,000 square feet that sells groceries. Big grocers also could face special conditions if they want to move into an existing vacant store. The measure also forbids moving into an existing store and then expanding.

The County Elections Division verified the signatures on the initiative petition, city officials said.

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BOARD VOTES NO ON WAL-MART'S NEW PROPOSAL

By EILEEN SCHULTE,
St. Petersburg Times
October 18th, 2008              [back to top] 

Bald eagles, gopher tortoises, sensitive wetlands and potential traffic backups on U.S. 19.

Those were among the issues raised by emotional residents at a Planning and Zoning Board meeting on Thursday night to discuss Wal-Mart Supercenter's revised site plan.

But the task at hand was for board members to decide whether to recommend the site plan.

They voted against it.

It took 51/2 hours of emotionally draining discussion by proponents and opponents, but in the end, members voted 4-2 that the certificate of concurrency had expired and the motion for application for site plan approval was denied.

New board appointees John Tarapani and Bill Vinson had recused themselves, citing previous statements against the proposed 203,077-square-foot store.

The board's conclusion is not binding. It is only a recommendation that the City Commission will take under advisement when it meets at 6:30 p.m. Tuesday at City Hall, 324 E Pine St.

Much of the discussion Thursday night raised familiar arguments both for and against the store.

Proponents say it will bring jobs and budget-saving prices to an area hit hard by the economic downturn.

"The property they purchased is zoned for business construction," said Steven Williams of Tarpon Springs. "Why are they being held up building on property they purchased? It's a good company. They are going to provide jobs."

Opponents say it will spoil the town's unique character and destroy the environmentally sensitive site along the Anclote River.

"There are 15 Wal-Marts in a 21-mile radius," said Evelyn Conner, a Tarpon Springs resident. "Wal-Mart has more money than God, so we know they will be there."

Others raised nature and environmental issues, including a bald eagle's nest spotted on the property.

Kim Myers of Tarpon Springs said Wal-Mart has been aware of the nest's existnce on the proposed construction site since April, and yet those involved in the project never informed the city or wildlife officials of the nest.

She implored the board not to "pass the buck."

"Do your job and represent the people of Tarpon Springs and let the bald eagles raise their families in peace," Myers said.

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Wal-Mart seeks growth in small town China

By WILLIAM FOREMAN
Associated Press
10.18.08                                         [back to top] 

LOUDI, China - Maoming, Wuhu and Loudi.

They're Chinese cities so far in the boonies that Lonely Planet doesn't even bother to mention them in its popular travel guide. But Wal-Mart has found them, as the company makes an aggressive push into China's smaller markets.

China's economic growth is rapidly spreading out from the main cities like Beijing and Shanghai into the hinterlands, where the middle class is taking off. In a report last year, the consulting firm A.T. Kearney said 75 percent of the middle market is expected to be in tier-two and tier-three cities by 2017.

These cities are "small" only by the standards of a country with 1.3 billion people. For example, Wuhu in eastern China has 2.3 million people and Maoming in the south has 6.8 million, providing a strong consumer base as incomes rise.

In response, retailers are pushing into the hinterlands, including American coffee chain Starbucks Corp. and French store Carrefour SA. Carrefour, the world's second-largest retailer after Wal-Mart, is the largest foreign retailer in China.

Faced with saturated markets at home, these retailers are increasingly looking to emerging economies such as China to drive sales growth. Wal-Mart's attempt to gain a bigger foothold in China is anchored in smaller cities: Only three of the 30 outlets Wal-Mart Stores Inc. opened in China last year were in Shanghai, Beijing and Shenzhen. The rest were in provincial capitals or other cities.

"I think the capacity for growth in China might exceed that of the U.S., if you look at it in the long term," Terrence Cullen, Wal-Mart's vice president of development in China, said in an interview in his office in Shenzhen, the southern boomtown across the border from Hong Kong.

Wal-Mart said its China sales rose 32.2 percent in the second quarter, while international sales overall were up 16.9 percent.

But experts warn there are risks in smaller markets. People are not as well-off, so it's harder to turn a profit. Local suppliers may be less reliable, a concern in a country plagued by quality scandals, including the recent discovery of contaminated baby formula blamed for killing four infants and making thousands sick.

Moreover, the big-bang growth strategy - opening stores across China - requires a bigger investment than the gradual expansion the company pursued in the U.S.

Two of the newest stores are in Loudi (pronounced lou-DEE), a steel and mining town of 4 million people in central China. It's just down the road from Shaoshan, the birthplace of late leader Mao Zedong - who would likely be horrified to hear that a flagship of American capitalism has moved into his neighborhood.

At one of the new Loudi Wal-Marts, a woman in blue overalls greets shoppers. The sprawling, brightly lit and spotlessly clean store has the same general look and feel of one of the company's well-stocked, wide-aisled stores in the U.S.

But a few steps inside, it becomes clear that Wal-Mart is trying to deliver everyday low prices with Chinese characteristics.

The smoky scent of thick slabs of dried smoked pork piled high in a display case mixes with that of laundry detergent and plastic. There are foreign brands: Raid roach killer, Head & Shoulders shampoo, Budweiser beer and "pesto Italiano" flavored Pringles potato chips. But there are also bins of reddish-brown dried squid and vacuum-packed packages of preserved Wuchang fish, one of Mao's favorites.

"I come here all the time," said Chen Yatian, a 21-year-old engineering student. "The prices aren't higher than the small shops outside, and I think the quality is better. My friends and I buy all our snacks here, things like spicy dried tofu."

The need to satisfy sharply different regional tastes is one of the challenges Wal-Mart faces in smaller markets, said Dean Xu, professor of strategy and international business at the University of Hong Kong. Wal-Mart will have to source many goods from local suppliers, potentially raising quality issues. "If there is one incident, it can ruin your company's reputation," Xu said.

Still, Wal-Mart's Cullen says the expansion is a logical step as China's middle class swells and the economy becomes driven more by consumers than exports. Major markets have their drawbacks too, he added.

"The big cities are very difficult to do business in for all the obvious reasons: They're crowded. It's difficult to find real estate. It's expensive and there's competition," said Cullen, who previously helped rival Costco Wholesale Corp. break into South Korea and Taiwan.

In the United States, Wal-Mart started with a single store in Arkansas in 1962 and built up its distribution network slowly, opening stores in adjacent counties and avoiding big leaps, said Emek Basker, a University of Missouri economics professor who has done extensive research on Wal-Mart's growth. The company had a conscious policy to open outlets only within a day's drive of its distribution centers, she said.

Wal-Mart declined to comment on whether it would be scaling back its international expansion plans amid the global financial crisis.

Wal-Mart is being outmaneuvered by Carrefour because its executives have taken too long to understand the China market and add stores, said Burt P. Flickinger III, managing director of retail consulting firm Strategic Resource Group. Carrefour, with $4.3 billion in sales, ranked sixth among all retailers in China in 2007, according to the China Chain Store & Franchise Association. Its sales were up 24 percent over the previous year.

Wal-Mart was 13th, with sales of $3.1 billion, a 42 percent increase over the previous year. The American chain also owns a 35 percent stake in Trust-Mart, which operates about 100 stores in 34 Chinese cities.

At the Wal-Mart Supercenter in Loudi, homemaker Zhang Xiaoling, 32, said the store with the lowest prices would get her business.

"I always come here. I think the selection is great and the prices are fair," Zhang said, as she struggled to keep her 2-year-old son from wandering away. "There was a small supermarket just down the road. When Wal-Mart opened, it closed. It just couldn't compete."

A few blocks away, in the dark and dingy basement of a dilapidated building, most of the merchants at a traditional food market appeared blase about the new competitor.

Shau Youming, who sells spices and soy sauce in a small stall, said Wal-Mart hasn't hurt his business.

"I've got my old customers and they all live nearby," he said. "It's convenient for them to come here. My prices aren't high and I keep an eye on Wal-Mart's prices. I'm not trying to make a lot of money. Just enough to make a living."

Copyright 2008 Associated Press. All rights reserved.

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Wal-Mart environmentalism

By Lawrence Solomon ,
Financial Post
October 17th, 2008                     [back to top] 

Stock market indexes have plummeted from their inflated peaks. Oil and other commodities have likewise plummeted. The next commodity to tumble from unsustainable peak levels: environmentalism. In part, I am making this prediction because, in my 30 years as an environmentalist, I have never seen so many governments and so many corporations so profusely espousing so many environmental causes. Where promoting environmentalism was once seen as daring and counter-cultural, today it has become banal, no longer the exclusive preserve of a Body Shop chain, but of every retailer down to Wal-Mart. For the same reason that clothes go out of fashion after the masses embrace them, mass-marketed environmentalism will come to be disdained. That won’t sell for long. I am predicting a collapse of today’s Wal-Mart environmentalism for another reason, too: Much of it is misguided, based on misunderstanding and vacuity.Global warming is by far the biggest such example. Those who have been following my Denier series in these pages know that large numbers of distinguished scientists dispute the conventional wisdom on climate change, making absurd the claim that the science is settled on climate change. And yet government and corporate propaganda — in global warming and elsewhere — strip away all subltety and uncertainty in their public relations programs, portraying environmental problems and proposing environmental solutions in cartoon-cutout simplicity that, more often than not, accomplish nothing good or make matters worse. While governments and industry discount major environmental issues that affect crown corporations and crown resources (nuclear power, forestry), they stir up concerns in consumer areas that have high visibility and often pose few true hazards. The results are often perverse: Blue Box recycling programs that promote waste; ethanol blends for automobiles that benefit the farm lobby while depleting the land and fouling the air; bans on incandescent bulbs that ignore consumer preferences but please light bulb manufacturers seeking lucrative new markets; public transit systems that run near-empty buses along low-density routes; “Right-to-Farm” laws that legalize polluting practices; demonization of private water systems, including bans on water bottles, when private systems have a superior safety and environmental record — in short, most of the environmental policies that governments put before the public are wrong-headed. A third reason for my prediction that environmentalism has peaked is the instinct for self-preservation among the political leadership. Thinking they could raise revenues while appearing green, opportunistic politicians have been promoting environmental taxes without having a credible case to make. The result, increasingly, is political ruin. The federal election results this week are, in good part, a testament to Liberal leader Stéphan Dion’s failure to sell his Green Shift — the Liberals obtained the lowest share of the vote since Confederation. In England, where citizens face the world’s highest burden of green taxes, the ruling Labour Party received a miserable 3% of the vote in by-elections earlier this year and London’s mayor, the greenest in Europe, was thrown out of office. Across Europe, once-green politicians are now backing away from their earlier commitments to push green agendas. In stock and commodity markets, when values fall from unrealistically high levels, they often fall further than justified. When environmentalism falls from its high values on the realization that many concerns have been oversold, it too will likely fall further than justified. Environmentalism will then need to reestablish public trust before real environmental gains can be made. As history shows, after being burned in the stock market, investors often stay away for years, fearful of being burned again. The lack of trust harms the greater economy. We have no history of what happens when citizens feel taken in by false environmental claims. But we may soon find out.

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Wal-Mart Closes Unionized Auto Center in Quebec*

By JON SPRINGER
Oct 17, 2008                                   [back to top] 

TORONTO — Citing “an unworkable union contract” that increased costs by more than 30%, Wal-Mart Canada on Thursday closed the Tire Lube Express automotive center at its discount store in Gatineau, Quebec. The center won certification with the United Food and Commercial Workers union in 2005, and a contract was imposed by the Quebec Labor Board in August.

Wal-Mart Canada in a statement said it could not provide value to customers when the contract called for 33% wage increases for the center’s employees. “For three years Wal-Mart Canada participated in the bargaining and arbitration process in good faith with the hope of achieving a reasonable contract that would keep the Gatineau TLE open,” Andrew Pelletier, a spokesman for Wal-Mart Canada, said in a statement.

The Gatineau auto center — which employed five workers and a manager, who will be offered positions at other Wal-Mart auto centers or the Gatineau discount store, which was not affected by Thursday’s announcement — was the second Wal-Mart business in Quebec to close following organized labor winning representation. A discount store in Jonquierre closed in 2005 just as contract bargaining was to begin.

Wayne Hanley, president of UFCW Canada, in a statement Thursday said the Gatineau closing was “one more example of [Wal-Mart’s] blatant disregard for Canada’s Charter of Rights and Freedoms.”

Wal-Mart objected to the certification processes at the Jonquierre and Gatinueau locations, saying the union did not allow a vote of all employees.

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'Super' Wal-Mart a no-go for Riverhead

By Tim Gannon,
The News Review
October 16th, 2008                  [back to top] 

Riverhead Town's approval of a proposed 170,000-square-foot Wal-Mart supercenter at the west end of Route 58 is no more. A state Supreme Court judge last week overturned the Town Board's June 2007 site plan approval for a New Jersey-based developer's application to build the massive store on the north side of Route 58, across from Tanger Outlet Center.

It would have been Long Island's first Wal-Mart supercenter. Aside from the traditional retail competent, the plans also called for an auto repair center and a 54-seat eatery.

The town's decision had been challenged by two lawsuits. State Supreme Court judge Thomas Whelan issued similar decisions on each case last Monday. One lawsuit was filed by the United Food and Commercial Workers and six members of that union who are Riverhead Town residents.

The other lawsuit was filed by Riverhead PGC, the company that owns the shopping center where a Wal-Mart is currently located. It raised many of the same issues the UFCW lawsuit raised.

The food workers' union has launched a nationwide campaign against Wal-Mart and has a Web site called "Wake Up Wal-Mart, America's campaign to change Wal-Mart."

While the union's overall complaints about Wal-Mart deal with issues like how it treats employees, its lawsuit in the Riverhead case dealt strictly with zoning issues.

The developer, Headriver LLC, originally sought to built a 138,000-square-foot Lowe's Home Improvement Warehouse on Route 58. While the Town Board in 2002 had voted 3-2 in favor of that application, it was technically considered rejected since four votes were needed to overturn a negative recommendation by the Suffolk County Planning Commission.

Headriver challenged that rejection in court, but later replaced the proposed Lowe's store with a Wal-Mart.

The current application calls for a 169,547-square-foot Wal-Mart store and a separate 27,000-square-foot retail building on 21 acres on the north side of Route 58, across from Kroemer Avenue. It would replace the existing Wal-Mart in the Riverhead Plaza shopping center farther east on Route 58, which measures about 113,000 square feet.

In order to build a store that big, Headriver needed to purchase and transfer 41 farmland development right credits from the town's Agricultural Protection Zone. Even with the additional development rights, which permit the applicant to exceed the normal Town Code size limits by 60,000 square feet in exchange for protecting farmland, the project needed six zoning variances.

Those variances were included in the Town Board's site plan approval. According to town officials, local laws established in 2003 allow for the agency that is granting site plan approvals to also grant variances when it comes to applications that involve development rights transfers (TDR).

The two lawsuits claim the Town Board exceeded its authority in granting zoning variances, which is normally done by the Zoning Board of Appeals.

The judge's decision agreed.

The lawsuits also claim the Wal-Mart approval was not done in accordance with the requirements of the town zoning in that area, which calls for a "campus-style" development, and that a motor vehicle repair center and a 54-seat food shop, which were part of the proposed Wal-Mart store, are not permitted uses in the site's Destination Retail Center (DRC) zoning, which the judge also agreed with.

"The Town Board cannot ignore the express statutory regulations of the DRC zoning district and the years of planning that culminated with the Town Board's adoption of the Town of Riverhead Comprehensive Plan," Judge Whelan wrote.

He later added: "One of the most cherished principles of our democracy is the respect and deference accorded our governing laws by our citizenry. Town Boards are not exempt from that fundamental ideal."

Riverhead Supervisor Phil Cardinale said he felt the suits should have been dismissed from the start, arguing that the parties that filed suit had no legal standing filed suit.

In addition, he said that several of the zoning codes pertaining to the transfer of development rights that were being challenged in the lawsuit were adopted in 2003, and by law could only be challenged within four months after their adoption.

"You can't simply throw these laws out now because people have relied on them," he said.

He said the town either will request that the case be reargued before Judge Whelan or will file an appeal.

"We're pleased with the decision, but we're not surprised," said Jim Gaughran, attorney for the UFCW workers. "We felt that once all the facts got before a judge, we would win, because the town can't violate its own master plan and zoning code.

"The judge also made it clear to the town that there are certain powers that belong to the Town Board and certain powers that belong to the Zoning Board of Appeals. I feel pretty confident we would win on an appeal."

Linda Margolin, the attorney for Headriver, declined comment on the ruling.

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Nike sues Wal-Mart, alleges patent infringement

By Nicole Maestri,
Reuters
October 16th, 2008                       [back to top] 

NEW YORK, Oct 16 (Reuters) - Nike Inc has sued Wal-Mart Stores Inc, saying the world's largest retailer is selling athletic shoes that infringe on its design patents.

In a complaint filed on Monday, Nike claims Wal-Mart is selling shoes that infringe on its Shox line, which is designed with what looks like springs in the heels.

"Wal-Mart knowingly and intentionally sold and continues to sell the infringing Shoes as simulations of Nike shoes," the Nike complaint states.

Nike is seeking an order to bar Wal-Mart from selling items that infringe on its patents and "damages adequate to compensate Nike for the patent infringement that has occurred."

Wal-Mart could not be reached for an immediate comment.

The complaint was filed in the U.S. District Court for the Northern District of Illinois, Eastern Division.

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What's it really like to work at Wal-Mart?

David Nassar
Wal-Mart Watch                           [back to top] 

Now you can find out. Today, we're launching a brand new website that gives Wal-Mart employees an opportunity to speak out and share their stories about Wal-Mart's low-wage, low-benefit business model. Read, watch or listen to the stories of the people who know Wal-Mart best - the company's own workers: http://www.walmartspeakout.com While Wal-Mart employees struggle to "live better" on what Wal-Mart pays them, the Walton family's net worth has risen to more than $100 billion. Sam Walton's heirs, who own the controlling share of Wal-Mart, are four of the top 10 richest Americans. What do they do with all that money? Wal-Mart spends millions of dollars on fancy TV ads and slick PR consultants to promote positive stories about the company. But nobody ever tells the unscripted stories of what it's really like to work at Wal-Mart - stories like these:

"I was fired while on medical leave. I had pancreatic surgery; they said the policy changed while I was on medical leave."

"I am not available at night. That is not an option for me, being a single mom. I feel like I am getting pushed out of my full-time job because of being a single mom."

"Wal-Mart workers are afraid to say anything because they might get fired over it. "Another thing is when you have your evaluation each year you get a very small raise then they cut your hours back so that you don't make anymore take home than you did before."

"I have a problem with management asking me and various other employees to finish up work that can't be done with the staffing they provide and staying over numerous hours and them not letting us clock in on schedule in order to save on payroll."

There are so many stories like these out there that deserve to be heard.

Check them out for yourself: http://www.walmartspeakout.com Average Americans are struggling amidst the current economic crisis - and that includes Wal-Mart workers. We hope that through these employee stories, the collective voices of Wal-Mart workers can convince Wal-Mart executives - and particularly the Walton family - to do better for its employees. http://www.walmartspeakout.com

Sincerely,
David Nassar
Wal-Mart Watch

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Bald eagles snarl fight over Wal-Mart

By THERESA BLACKWELL,
St. Petersburg Times
October 15th, 2008                        [back to top]  

TARPON SPRINGS - What has been a fierce battle between Wal-Mart officials planning to build a new supercenter and Tarpon Springs residents bent on preserving land on the Anclote River just got more complicated.

Nature has thrown a punch of its own.

A bald eagle pair has built a sturdy and federally protected nest on the property.

For the birds, it's an ideal site: a live pine tree with branches that twist under the nest to support it, a river with clear water to fish and not much disturbance nearby.

But it's less than 200 feet from the walls of a planned nearly 5-acre Wal-Mart supercenter. On site plans, the nesting tree appears to be in the store's parking lot, and slated for removal.

Tuesday, a Wal-Mart official said this is not the first time they have discovered an active bald eagle nest on property they were developing. So they know what's required and how to work with the agencies involved. They can do it this time, too.

Others see the nest as more of a stumbling block.

Mayor Beverley Billiris said the agencies that protect the eagles will have to weigh in and advise the parties involved. One thing she will not vote for, she said, is another all-night meeting when the City Commission takes up the site plans Tuesday. "Maybe the eagle will settle the whole thing," she said. "I think nature will be the one that will have the last say in it. That's almost comical."

Dory Larsen, president of Concerned Citizens of Tarpon Springs, a group that has worked to stop Wal-Mart and protect the river, hopes the eagles make a big difference to her cause.

"It's beyond fantastic news," she said. "I am just e-l-a-t-e-d."

The eagles have been carrying sticks to the nest, perching in or near the live pine, flying back and forth together, said Barb Walker of East Lake, an Audubon of Florida Eaglewatcher who has been watching and documenting the nest.

Although bald eagles are no longer on the list of threatened and endangered species , they are still protected by the Migratory Bird Treaty Act and the Bald and Golden Eagle Protection Act. The laws prohibit killing, selling or otherwise harming eagles, their nests or eggs.

"We've been aware since spring that there are eagles on the site," said Quenta Vettel, a Wal-Mart spokeswoman. "We have an environmental engineer who monitors the site on a regular basis."

The company has faced this situation before.

"This isn't part of the city's purview," she said. "Once we have site plan approval and all the permits that will be required to start clearing and construction, then you begin working with the appropriate agencies to make sure you protect the nest and the eagles."

The big box retailer got City Commission approval for its site plan in January 2005, but has faced several delays due to permitting missteps and challenges to its revised site plan.

Most recently, the city's Board of Adjustment ruled changes to Wal-Mart's site plan required further study by city officials. The city's Planning and Zoning Board is set to finish its hearing on the proposed changes on Thursday. Next week, the commission will vote on whether to approve or deny the changes.

If Wal-Mart gets to build the supercenter, it will have to jump through some big hoops. And the Florida Fish and Wildlife Conservation Commission will be holding up quite a few.

The state has a complicated web of rules for the management of bald eagles that suggests measures that can help to mitigate for development.

Ulgonda Kirkpatrick, a wildlife biologist who coordinates the state's eagle plan, said she didn't yet know all the specifics on the new eagle nest Tuesday, but it sounded like the nest would be classified as a category B project. That would mean no construction activity within 660 feet of the nest during nesting season without a state permit.

This morning, two wildlife biologists from the Florida Fish and Wildlife Conservation Commission are scheduled to meet with Walker, the eaglewatcher. They will look through a powerful scope to verify the active nest.

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China's loss is Alabama's gain as firm adds U.S. jobs

Need to cut costs prompts manufacturers to rethink outsourcing policy

Edmonton Journal
October 15th, 2008                    [back to top] 

Wal-Mart Stores Inc.'s worldwide quest for a lower-cost sleeping bag has led to a one-storey factory in northwest Alabama, where Chris Defoor has a new job.

The same forces that have sent thousands of American jobs overseas are now giving a lift to places like Haleyville, a town of 4,200 where Defoor is in his fourth month working at Exxel Outdoors Inc.

With costs in Alabama running three per cent below those in China, Exxel is cutting production at a joint venture in Shanghai while hiring workers, adding machines and increasing output at the 250,000 square-foot plant. This year, for the first time, the company will make more bags in the U.S. than abroad.

"We'd been losing the battle to China but had a feeling things were going to change," founder and chief executive officer Harry Kazazian said. "Call it a calculated gamble or hindsight, it's working for us."

The increase in production at Haleyville comes as manufacturing in the U.S. contracts at the fastest pace since 2001, during the last recession. Record exports that had supported output now are slowing as a growing number of countries grapple with the credit crisis.

Meanwhile, Wal-Mart, the world's largest retailer, saw its sales rise in September and is forecasting a third-quarter profit. The company is "gaining more people who are looking to save money by shopping there," Exxel's Kazazian said. "That's one of the reasons why we think we'll do well" as a supplier.

Kazazian's strategy is a result of the dollar's 17-per-cent drop against the yuan since 2005, rising wages in China and a jump in freight rates. He projects his company's revenue will rise as much as 20 per cent this year to $42 million from $35 million in 2007, helped by the Wal-Mart order last December for Disney-themed kids sleeping bags.

The need to cut costs means manufacturers large and small "are revisiting their outsourcing policy," said Norbert Ore, chairman of the manufacturing-survey committee at the Institute for Supply Management in Tempe, Ariz.

Ikea, the world's largest home-furnishings company, opened its first U.S. factory in May. Caterpillar Inc., the world's largest maker of earth-moving equipment, and Home Depot Inc., the biggest home-improvement retailer, plan to produce or buy more goods in the U.S.

Such moves are "a positive for employment and certainly a plus for manufacturing, because those are the kind of jobs that would return," said Michael Moran, chief economist at Daiwa Securities America Inc. in New York.

On a recent morning, Defoor, 21, is busy manoeuvring a forklift to take boxes of sleeping bags to three Wal-Mart trucks lined up at the loading dock.

Exxel, he says, is "one of the only places around here that's hiring." It's also the last major maker of sleeping bags in the U.S. out of a half-dozen in the business when Kazazian, 46, started the company in 1996, the CEO says. Most had moved overseas by the time he began production in 2000 at the Haleyville factory, which Exxel acquired from sporting-goods maker Brunswick Corp.

With U.S. retailers increasingly buying from lower-cost overseas suppliers, the company struggled to keep the plant open while shipping in most of its bags from Shanghai.

In 2005, China's cost advantage began to erode, Kazazian said. As the yuan appreciated, Exxel had to pay more in dollars for materials such as recycled polyester for insulation. In the first half of 2008, wages in urban China jumped 18 per cent from a year earlier, and new minimum-wage and overtime rules will add more to his costs.

Last year, 60 per cent of Exxel's bags were made in Shanghai, while Haleyville produced the rest. By 2009, only a third will come from China, and by 2010, Haleyville will account for 90 per cent, Kazazian said.

Increasing output in the U.S. made even more sense with the order from Wal-Mart, Exxel's biggest customer. The company can deliver a bag within three days from its Haleyville plant, while shipping one from China might take as long as two months.

"Labour is China's advantage and our weakest link," Kazazian said. "But they can't compete with me on my just-in-time" production cycle. Customers pay as much as 10-per-cent more to get deliveries as needed rather than incurring expenses to store inventory, he said.

"In the United States -- and in other markets -- we purchase locally whenever we can," said Wal-Mart spokeswoman Tara Raddohl.

Exxel expanded its Haleyville workforce by 20 per cent this year to 70 employees and will enlarge it another 20 per cent by 2010. In July, the factory added a third production line to boost output to as many as 2.1 million bags this year from 1.2 million in 2007.

The pickup in work has reassured Winnie Bennett, who was dressed in a purple jumpsuit as she packed scraps of lining into a box. "You've got to have faith," said the 71-year-old. She's spent 21 years in the factory and wants to work there "for many more," she said.

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Some bottled water toxicity shown to exceed law

Jane Kay,
SF Chronicle
Wednesday, October 15, 2008                   [back to top] 

Bottled water brands do not always maintain the consistency of quality touted in ads featuring alpine peaks and crystalline lakes and, in some cases, contain toxic byproducts that exceed state safety standards, tests show. The Environmental Working Group, a nonprofit organization with offices in Oakland, tested 10 brands of bottled water and found that Wal-Mart's Sam's Choice contained chemical levels that exceeded legal limits in California and the voluntary standards adopted by the industry. The tests discovered an average of eight contaminants in each brand. Four brands besides Wal-Mart's also were contaminated with bacteria. The environmental group filed a notice of intent to sue Wal-Mart Tuesday, alleging that the mega-chain failed to warn the public of illegal concentrations of trihalomethanes, which are cancer-causing chemicals. "The investigation has uncovered that consumers cannot be assured of the quality of their bottled water," said Olga Naidenko, a toxicologist at the Environmental Working Group and lead author of the bottled-water study. "Our study was a snapshot of the marketplace. We found some brands that provided good quality and other brands that contained various chemical pollutants. What this shows is that consumers cannot have confidence. They don't know what they're getting," she said. The group also singled out Giant Supermarket's brand Acadia for excessive levels of disinfection byproducts, but it didn't sue because the Mid-Atlantic chain's water isn't sold in California. Some of the Sam's Choice bottled water purchased from Wal-Marts in Mountain View and Oakland came from Las Vegas Valley Water District's sometimes-chlorinated public water supply, the group found. Wal-Mart responds Shannon Frederick, senior communications manager at Wal-Mart's corporate headquarters in Bentonville, Ark., said the corporation stands by its product. Wal-Mart owns 4,200 stores in the United States. "Both our suppliers' tests and tests from an additional external laboratory are not showing any reportable amounts of chlorine or chlorine byproducts. We're disappointed that the EWG has not shared more details with us as we continue to investigate this matter," Frederick said. "We're puzzled by the EWG's findings." The Las Vegas water supply meets federal standards for toxic chemicals that form when disinfectants such as chlorine react with organic matter, sometimes in reservoirs. The federal standard is 80 parts per billion. But in California, the byproducts standard in bottled water is eight times as strict, possibly making Wal-Mart liable for action under Proposition 65, the Safe Drinking Water and Toxic Enforcement Act of 1986. In 1995, after animal tests showed that the byproducts could cause cancer and reproductive damage in lab animals, California added the bottled water provisions to the health and safety code, setting a standard at 10 parts per billion. The Food and Drug Administration requires bottled water to meet the same standards as tap water from public systems - which is 80 ppb. The FDA doesn't require bottled water companies to inform consumers of the source and presence of contaminants. Yet by law, public water companies must send customers annual information about sources and the presence of contaminants such as trihalomethanes, arsenic, nitrates and fluoride in the water supply. Study findings In the Environmental Working Group study, the University of Iowa Hygienic Laboratory screened for 170 possible contaminants. The lab found 38 pollutants in 24 samples from 10 major brands purchased by the group in California, Washington, D.C., and eight other states. The environmental group won't release the names of eight other brands it tested, saying it would do so only after it conducts more-extensive testing. Scott Huntley, a spokesman for the Las Vegas Valley Water District, said he had no knowledge that Wal-Mart was using Las Vegas's water supply for bottling. After some checking, he said a local water-bottling company that sells to the Strip could be supplying Wal-Mart as well. Some findings from the study: -- Three samples of Sam's Choice bought in Oakland, Mountain View and Fayetteville, N.C., contained levels of total trihalomethanes between 14 ppb and 37 ppb, exceeding the state and industry standard of 10 ppb. -- One of the byproducts, bromodichloromethane, also a carcinogen, is even more toxic to lab animals and is more strictly controlled. The state's cancer safety standard is 2.5 ppb. Three bottles of Sam's Choice purchased in Mountain View and Oakland contained the contaminant at levels from 7.7 ppb and 13 ppb. -- Also present in bottled water were caffeine and the pharmaceutical Tylenol, as well as arsenic, radioactive isotopes, nitrates and ammonia from fertilizer residue. Industrial chemicals used as solvents, degreasing agents and propellants were also found in the tests. -- Trace amounts of synthetic chemicals or degradation products from the manufacture of PET, or polyethylene terephthalate, plastic bottles were found, including acetaldehyde, isobutane and toluene. At those low levels, scientists can't ascertain the health effects. Bottled vs. tap Americans drank more than 9 billion gallons in 2007, and fewer than half of 228 brands of bottled water reveal their source. Typical cost is $3.79 per gallon, 1,900 times the cost of public tap water. Green campaigns have focused on steering away from bottled water because manufacturing, transporting and sending unrecycled bottles to the landfill use natural resources and create an environmental burden. San Francisco Mayor Gavin Newsom issued an executive order in June 2007 barring use of city funds to purchase bottled water. "The primary reason is that it can cost a thousand times more, and you're not even getting better quality water," said Tony Winnicker, spokesman for the city Public Utilities Commission. "There have been hundreds of millions of dollars spent to market the myth that bottled water is purer and safer than the tap water. The study is further evidence that the myth is often a lie." Guide to safe drinking water Filters: Drink filtered tap water instead of bottled water. Use carbon filters, pitcher or tap-mounted. They reduce lead and disinfection byproducts. Install a reverse osmosis filter if you can afford it. Containers: Carry water in stainless steel containers. Research: Learn what's in your tap water. Suppliers publish water-quality tests. Find the full report on bottled water quality by the Environmental Working Group at www.ewg.org.

Copyright 2008 SF Chronicle

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Bottled water has contaminants too, study finds

By JEFF DONN,
AP National Writer
Tuesday, October 14, 2008                       [back to top] 

Tests on leading brands of bottled water turned up a variety of contaminants often found in tap water, according to a study released Wednesday by an environmental advocacy group. The findings challenge the popular impression — and marketing pitch — that bottled water is purer than tap water, the researchers say. However, all the brands met federal health standards for drinking water. Two violated a California state standard, the study said. An industry group branded the findings "alarmist." Joe Doss, president of the International Bottled Water Association, said the study is based on the faulty premise that a contaminant is a health concern "even if it does not exceed the established regulatory limit or no standard has been set." The study's lab tests on 10 brands of bottled water detected 38 chemicals including bacteria, caffeine, the pain reliever acetaminophen, fertilizer, solvents, plastic-making chemicals and the radioactive element strontium. Though some probably came from tap water that some companies use for their bottled water, other contaminants probably leached from plastic bottles, the researchers said. "In some cases, it appears bottled water is no less polluted than tap water and, at 1,900 times the cost, consumers should expect better," said Jane Houlihan, an environmental engineer who co-authored the study. The two-year study was done by the Washington-based Environmental Working Group, an organization founded by scientists that advocates stricter regulation. It found the contaminants in bottled water purchased in nine states and Washington, D.C. Researchers tested one batch for each of 10 brands. Eight did not have contaminants high enough to warrant further testing. But two brands did, so more tests were done and those revealed chlorine byproducts above California's standard, the group reported. The researchers identified those two brands as Sam's Choice sold by Wal-Mart and Acadia of Giant Food supermarkets. In the Wal-Mart and Giant Food bottled water, the highest concentration of chlorine byproducts, known as trihalomethanes, was over 35 parts per billion. California's limit is 10 parts per billion or less, and the industry's International Bottled Water Association makes 10 its voluntary guideline. The federal limit is 80. Wal-Mart said its own studies did not turn up illegal levels of contaminants. Giant Food officials released a statement asserting that Acadia meets all regulatory standards. Acadia is sold in the mid-Atlantic states, so it isn't held to California's standard. In most places, bottled water must meet roughly the same federal standards as tap water. The researchers also said the Wal-Mart brand was five times California's limit for one particular chlorine byproduct, bromodichloromethane. The environmental group wants Wal-Mart to label its bottles in California with a warning because the chlorine-based contaminants have been linked with cancer. It has filed a notice of intent to sue. Wal-Mart spokeswoman Shannon Frederick said the company was "puzzled" by the findings because testing by suppliers and another lab had detected no "reportable amounts" of such contaminants. She said Wal-Mart would investigate further but defended the quality of its bottled water. The researchers recommend that people worried about water contaminants drink tap water with a carbon filter.

___ On the Net: Environmental Working Group: www.ewg.org
Copyright 2008 AP

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Wal-Mart sets sights on Canadian banking licence, lobbying hard

By Simon Doyle,
The Hill Times
October 13th, 2008                               [back to top] 

Wal-Mart Canada has been working on obtaining a Canadian banking licence for about two years, and global credit tightening is now expected to bolster its arguments with the federal government in Ottawa.

On Oct. 8, the Canada Gazette published a notice that Wal-Mart Canada intends to apply for a licence to establish banking services in Canada. The notice said that "the bank will carry on business in Canada under the name Wal-Mart Canada Bank in the English form and La Banque Wal-Mart du Canada in the French form," and that its head office will be located in Mississauga, Ont.

Sources say Wal-Mart has been active on the file in Ottawa for about two years, primarily trying to gauge reaction to its business plan with the Office of the Superintendent of Financial Institutions—Canada's bank regulator. Although the minister of Finance approves the licence, the bureaucratic work and recommendations are done by OSFI.

One banking lobbyist told Lobbying last week that the very fact the notice has been published in the Canada Gazette means Wal-Mart has already laid the groundwork for its licence with OFSI.

"You don't do that unless you've had some warm feedback from OSFI," the lobbyist said. "I'd say they're fairly far along on their business plan."

The lobbyist added that the credit climate now in Canada, which has tightened up in the face of the U.S. credit crisis, is likely to bolster Wal-Mart's arguments for greater competition. "It's another source of lending that has access to a very large pool of capital," the lobbyist said.

Jean Paul Duval, a spokesman for OSFI, said the office does not comment on specific applications, but said the office takes a "holistic approach" to approving banking licences, which includes assessing applications "within the economic context in which it's received." Criteria for approving a new licence also ranges from access to capital to having the expertise and experience to run a bank, he said.

Wal-Mart has hired the services of the Prospectus Associates government relations firm in Ottawa. Robert Evershed, Sean Kirby, Martin-Pierre Pelletier, and William Pristanski, Prospectus consultants, are currently registered to lobby on behalf of Wal-Mart.

Wal-Mart opened banking in Mexico last year, but efforts to do so in the U.S. have met stiff resistance from small banks and consumer groups. It's expected that Wal-Mart's banking services in Canada will include loans, savings accounts, credit cards, mortgages, and RRSPs, however Wal-Mart has said it would be premature to speculate on what services will be offered.

Observers say that if Wal-Mart succeeds in offering banking services in Canada, the move would put pressure on the U.S. to do the same. Retail chains in Canada such as Canadian Tire and Loblaws have expanded into banking.

Michael Janigan, executive director of the Public Interest Advocacy Centre in Ottawa, acknowledged that that new entrants into Canada's banking system are usually welcome, but said there is concern about potential "vertical dominance," in which Wal-Mart could be involved in all aspects of consumer transactions, from financing to consumer spending to mortgages, inside and outside of Wal-Mart stores.

"Vertically integrated industries are always a concern. It's whether the potential exists for market dominance," he said.

The banking lobbyist said that Wal-Mart's lobbying activities in Ottawa would mostly be "a process thing" and would not involve a lot of lobbying of the government. Some lobbying would take place with the office of the minister of finance, however, where the final approval will take place.

"You have to put together a really solid business plan and OSFI has to look at that and say, 'It looks pretty good to us,'" the lobbyist said.

Wal-Mart officials did not return calls by deadline last week, and Mr. Pristanski, at Prospectus, was not available for an interview.

Lobbying commissioner to publish cooling off period exemptions

The two wannabe lobbyists who have applied for exemptions from the government's five-year cooling off restriction better have left their government jobs before July 2, 2008.

The Office of the Commissioner of Lobbying has confirmed that two people have applied for exemptions, but the office won't reveal their names for privacy reasons, and it's not known when they left the government—before or after July 2, when the new Lobbying Act came into force.

The difference is of critical importance. If they left after July 2, they are subject to the Lobbying Act and can apply to the Lobbying Commissioner for an exemption under the act. But if either of them departed before July 2, the Lobbying Act and all of its provisions did not yet apply, and Lobbying Commissioner Karen Shepherd would close their requests fairly quickly.

But you're damned if you do, damned if you don't. Senior public office holders who left the public service before July 2 are also subject to another cooling off regime that the Tories implemented in February 2006. It falls under the Conflict of Interest and Post-Employment Code for Public Office Holders, enforced by Ethics Commissioner Mary Dawson. That code says former ministers, senior public servants and ministerial staff "may not act as consultant lobbyists, or accept employment as in-house lobbyists, for a period of five years after leaving public office."

There were a few departures of senior ministerial staff, as well as some from the PMO, just around the time that Guy Giorno, the Prime Minister's chief of staff, replaced Ian Brodie on July 2. Some left before and some left after that date.

Under the Lobbying Act, senior public office holders are restricted from registered lobbying for a period of five years after they've left the public service. However the law says that the commissioner of lobbying may exempt someone from the cooling off period if she feels that the decision would "not be contrary to the purposes" of the Lobbying Act.

The law says, for instance, that someone could be exempted if they were a public office holder "for a short period"; if they were a public office holder "on an acting basis"; were working under a student employment program; or worked only in an administrative position.

If Ms. Shepherd grants any exemptions to the cooling off period, they will be published, along with the reasons for the decision, on the commissioner's website. If an exemption is not granted, however, the applicant's name will not be disclosed.

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In Shift, Wal-Mart Puts Focus Back on Private-Label Growth

By Jack Neff ,
Advertising Age
October 12th, 2008                      [back to top] 

BATAVIA, Ohio (AdAge.com) -- After de-emphasizing private label for more than a year, Wal-Mart Stores is looking to ramp up its program by adding package-goods marketing talent, and the move could present a substantial new challenge to marketers who rely on the world's biggest retailer as the economy worsens.

Andy Ruben Andy Ruben

Cincinnati-based executive search firm Wiser Partners, which specializes in recruiting package-goods marketing talent from the likes of Procter & Gamble Co. and others, last week circulated a solicitation for a director-portfolio strategy, private brands, for Wal-Mart.

The new position, focused on product development, would oversee three existing direct reports and an unspecified number of new additional hires. It reports to Andy Ruben, VP-private brands, an executive with a knack for being where the zeitgeist is. Mr. Ruben took the private-label position late last year after serving as the retailer's high-profile VP-sustainability for three years.

$30 billion in sales At the time of the move, Wal-Mart and Mr. Ruben positioned it as helping focus the retailer's sustainable packaging and sourcing program on its vast private-label business, which has estimated annual sales of more than $30 billion in package goods in its namesake U.S. division alone.

In an interview with the environmental blog Treehugger.com shortly after he made the move, Mr. Ruben called his transition a "continuation of what I've been focused on in a new way."

But the new director position appears more squarely focused on growing sales, market share, cash flow and brand awareness -- all of them included in the performance metrics of the job description, while sustainability metrics aren't. Wal-Mart is specifically seeking an executive with experience using consumer package goods-style "stage-gate" product-development processes, signaling a focus on more new products consistent with premium private-label brands Wal-Mart largely lacks today, unlike most of its competitors.

A Wal-Mart spokesman forwarded a query for comment to a spokeswoman in food merchandising for the chain, who did not respond by deadline.

Ramping up the private-label team signals a significant directional shift for Wal-Mart, which has de-emphasized private label in the past 18 months as it focused on national brands. One exception is White Cloud in paper products and diapers, which recently got rare backing with a national coupon drop. Unlike most Wal-Mart private labels, however, the company doesn't own that brand, licensing it instead from Paper Partners, a Boca Raton, Fla., company that laid claim to the brand after P&G abandoned it in an efficiency drive in the early 1990s. White Cloud has since, ironically, become a billion-dollar brand at Wal-Mart by some estimates, joining other even bigger brands such as Great Value and Equate.

Will move succeed? Wal-Mart's private-label unit shares declined throughout 2007 and into the first quarter of 2008, according to a June report by IRI, even as private-label shares were rising overall across the package-goods industry. Wal-Mart private label has been losing share consistently among shoppers described by IRI as "doing well," though they started picking up in the first quarter among those described as just "getting by."

But it's not clear a new push by Wal-Mart into premium private label can succeed. Some package-goods marketers noted that having good prices on national brands is key to the retailer's core value proposition, as price comparisons among individual retailer private brands carry little or no weight.

Particularly in household and personal-care areas, Wal-Mart will likely have trouble getting traction with premium private-label today, much as it has in years past, said Deutsche Bank analyst William Schmitz. "There are already some very strong value brands [in household and personal care]," he said, adding that past efforts to build the more premium Sam's American Choice in non-food categories have foundered.

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Medicaid strained by low-pay jobs

By Craig Harris,
The Arizona Republic
October 12th, 2008                         [back to top] 

With tens of thousands of homes being built in Arizona this decade, shopping centers, grocery stores and fast-food chains followed.

The 23 percent surge in retail business, the second-highest growth rate in the nation, has been a boon to sales-tax collections for communities, but low-paid retail employees have been a drain on state coffers. They are prime users of the state's health-care program for the poor, and they are fueling a major enrollment increase.

With one in six Arizonans enrolled, the program now costs taxpayers more than $1 billion annually. In 2000, one in 11 Arizonans was in the program, the state's version of Medicaid.

Companies with the most workers in the health plan, known as the Arizona Health Care Cost Containment System, or AHCCCS, are some of the state's biggest retail and restaurant employers: Wal-Mart, Target, Fry's, Bashas', McDonald's and Yum! Brands, which is the corporation behind Taco Bell, KFC and Pizza Hut restaurants.

Only eight other states and the District of Columbia have a higher percentage of residents in their respective Medicaid programs than does Arizona, according to the Kaiser Family Foundation, which gathers information on health policies.

Anthony Rodgers, AHCCCS director, said some retail employees simply can't afford private health-care coverage.

"Part of the issue in Arizona is the number of low-wage and part-time jobs, especially in the service and retail industries and small business," Rodgers said.

Rodgers said another reason for the growth of AHCCCS is expanded eligibility requirements, which voters approved in 2000.

Economic-development experts say the state needs to break its cycle of creating large numbers of low-skill jobs and focus on increasing skilled-job opportunities that result in higher incomes and, most often, enrollment in company-provided health insurance. If a change doesn't occur, they say, there will be even more pressure on a shrinking state budget and less money for schools, higher education and prisons.

Chasing retail

The state's economic landscape has changed significantly since 2000, when Honeywell, with 17,500 workers, was the state's top employer. Others in the top 10 included Motorola, American Express, Bank One Arizona (now JPMorgan Chase & Co.), America West Airlines (now US Airways) and Intel, according to The Republic 100, an annual ranking of the state's biggest employers.

Today, only Honeywell remains a top-10 employer, but its ranking has dropped to No. 5 as its high-wage workforce fell 27 percent this decade to 12,700 workers. The average annual wage at Honeywell is $73,000.

Wal-Mart is now the state's largest private employer, and its annual average wage is $22,547, according to the company. That is slightly higher than the $21,128 that a typical full-time retail worker makes in Arizona.

A single parent with two kids making either of those average retail wages would qualify for an AHCCCS program called KidsCare. Many retail jobs, however, are not full-time and the wages are lower.

Other retailers among the 10 largest employers in Arizona are Fry's, No. 7; Bashas', No. 9; and Safeway, No. 10. Each is also among the top 10 businesses with the most workers covered by AHCCCS during the past three years, according to records obtained by The Republic.

Ioanna Morfessis, a national economic-development consultant based in Phoenix, said a cultural shift will have to occur if Arizona wants to slow the growth of low-wage retail jobs.

"I don't think there is another state that chases retail the way we do," said Morfessis, president of IO.INC.

There are a few others, but only Nevada had a higher growth rate in retail jobs, 31 percent. Three other states -- California, Texas and Florida -- produced a greater number of retail jobs than Arizona did, but their populations are much larger than this state's.

"Retail jobs historically have never been high-wage jobs," Morfessis said. "The challenge is, our local governments depend heavily on local sales taxes." Thus, they push for more retail businesses because of the tax revenue generated by those businesses' sales.

Wal-Mart factor

Wal-Mart is Exhibit A when it comes to Arizona's retail growth. While Arizona added about 60,000 retail jobs this decade, Wal-Mart created more than a third of them. The company's statewide workforce increased 171 percent, to 31,785, since 2000, according to the Republic 100, an annual list of top employers.

As of June, the company had 1,680 workers, or more than 5 percent of its workforce, in AHCCCS. That cost taxpayers about $18.4 million annually, with the state's share being about one-third and the federal government covering the rest, according to state records.

Dennis Hoffman, an economics professor at the W.P. Carey School of Business at Arizona State University, said it's not necessarily Wal-Mart's fault that the company has the most workers on AHCCCS.

"They face a customer base that is relentlessly seeking the lowest prices. That is what Wal-Mart customers look for," Hoffman said. "If you deliver the lowest prices, you will not be in a position as a business to shower your employees with benefits."

Delia Garcia, a Wal-Mart spokeswoman, said that the company does not encourage employees to join AHCCCS and that it has created a plan that gives workers more than 50 options to customize a health plan.

She said that an individual can obtain coverage for as little as $24 a month and that nearly 93 percent of Wal-Mart's employees nationwide have health-care coverage, with about half getting it through the company. She did not have Arizona figures.

Although more than 1,000 of its workers depend on public medical assistance, Wal-Mart says it has created thousands of jobs in Arizona and collected $336.5 million in state sales taxes in fiscal year 2008 while paying an additional $48.4 million in state and local taxes.

"We are a significant contributor to the Arizona economy, and we employ more than 30,000 associates (workers)," Garcia said. "We are doing everything we can to make health care affordable."

The giant discount retailer also has fewer employees in AHCCCS than it had in 2005, when about 2,800 employees, or 10 percent of its workforce, were in the plan.

Other retail, restaurant and grocery employers say they, too, offer health-care benefits with modest employee premiums. But they say employees are drawn to AHCCCS because it is free or has minimal premiums and, unlike a company plan, doesn't have a waiting period.

Growth of AHCCCS

The overwhelming majority, 89 percent, of AHCCCS members are in a free acute-care program, while an additional 6 percent are part of KidsCare, which requires parents to pay a small monthly premium.

The rest of the more than 1 million members, a total that more than doubled this decade, are made up of small businesses obtaining coverage, the disabled and those in long-term care.

Rodgers, the AHCCCS director, said membership in the health program grew in Arizona after voters in November 2000 approved an initiative that expanded eligibility limits so those at 100 percent of the federal poverty level could qualify. The expansion also created new Medicaid categories for single adults and childless couples.

Rodgers added that although AHCCCS has grown, it has used federal funds to help pay hospitals that previously weren't compensated for treating the uninsured. The percentage of uninsured patients treated has decreased to 20 percent from 25 percent, he said.

But membership has grown so fast that the managed-care plan now costs the state general fund roughly $1.3 billion a year, about four times as much as the $310 million spent in 2000. Though the cost rose more than 300 percent, the state's population grew only about 30 percent.

During that time, AHCCCS has gone from consuming about 5 percent of the general fund and ranking fourth in state spending behind public schools, universities and corrections, respectively, to consuming 13 percent of the budget and ranking second in spending.

A typical worker on AHCCCS has two dependents, according to state figures, and the annual cost to cover that family is $10,930.

"Right now, the cost shifting is totally a burden to Arizona taxpayers. It's out of proportion," said state Sen. Tom O'Halleran, R-Sedona, vice chairman of the Senate Health Committee.

Reversing the trend

Job recruiters such as Barry Broome, chief executive of the Greater Phoenix Economic Council, want to reverse the retail-growth trend and attract better-paying jobs with benefits.

"AHCCCS has been a runaway budget item," Broome said. "There needs to be a shift in philosophy. When you don't make an investment in economic development, universities and public education, you end up creating a low-wage economy."

The task won't be easy.

Susan Carlson, executive director of the Arizona Business and Education Coalition, said that the state has an influx of "low-tech residents" who provide a job base for retail companies and that it needs to do a better job of educating kids.

"Students graduate from a system that allows them to take less-than-rigorous course work and graduate from high school. Today, a high-school student can graduate with two years of indiscriminate math. They are not prepared, and companies know that," said Carlson, whose coalition is made up of 113 members, including Intel, Arizona Public Service Co. and United Health Care.

Also, the halcyon days of higher-paying manufacturing jobs have diminished in the U.S., and Arizona lost more than 32,000 of those jobs in the past decade, according to federal Bureau of Labor Statistics.

Hoffman, the ASU economics professor, said the loss was compounded by the state not having a huge manufacturing sector.

"We are really struggling to get high-paying jobs," he said. "The fact is we don't have a sufficient number of high-skilled workers here.

"When businesses think of relocating, they like the fiscal climate, physical climate and the relatively affordable housing. But the quality of the workforce will be an ongoing concern."

|

The working poor

Many of Arizona's largest retail, grocery and fast-food establishments have the largest number of workers enrolled in the state's health-care program for the poor, the Arizona Health Care Cost Containment System. In the past three years, Wal-Mart, the state's largest employer, had the most employees covered by AHCCCS, according to figures provided by the state.Here are the 10 employers with the most workers in AHCCCS.

IN JUNE 2008

COMPANY; Employees in AHCCCS; % of workforce in AHCCCS

1. Wal-Mart 1,680 5.3 percent 2. McDonald's 538 5.9 percent 3. Yum! Brands 467 Not available 4. Fry's 406 3.6 percent 5. Circle K 368 6.8 percent 6. Bashas' 365 3.4 percent 7. State of Arizona 312 0.6 percent 8. Target 274 3.7 percent 9. Safeway 265 2.6 percent 10. Jack in the Box 234 3.8 percent

IN JUNE 2007

COMPANY; Employees in AHCCCS; % of workforce in AHCCCS

1. Wal-Mart 1,536 5 percent 2. McDonald's 465 5.1 percent 3. Yum! Brands 368 Not available 4. Bashas' 354 3.4 percent 5. State of Arizona 338 0.7 percent 6. Fry's 334 3 percent 7. Circle K 334 6 percent 8. Tucson Unified School District 269 2.4 percent 9. Safeway 259 3.1 percent 10. Burger King 223 4.8 percent

IN JUNE 2006

COMPANY; Employees in AHCCCS; % of workforce in AHCCCS

1. Wal-Mart 2,114 8.1 percent 2. Yum! Brands 714 Not available 3. McDonald's 699 7.7 percent 4. Fry's 623 6.7 percent 5. Bashas' 493 4.9 percent 6. Target 404 0.5 percent 7. Safeway 376 4.7 percent 8. Circle K 354 6.1 percent 9. Burger King 303 6.8 percent 10. Jack in the Box 301 4.9 percent

Notes: 1. Yum! Brands, which includes A&W, KFC, Long John Silver's, Pizza Hut and Taco Bell, would not disclose its total employment. 2. Percentages for McDonald's, Burger King and Jack in the Box are based on estimates of total employees. The estimates were made by using company-provided information on the number of stores and average staffing per store.

Sources: AHCCCS, cited companies, staff reports

Who qualifies for AHCCCS?

AHCCCS

To qualify for the Arizona Health Care Cost Containment System, a family's household income can't exceed the federal poverty level.

Thus, for a family of three, a typical household covered by AHCCCS, income can't exceed $17,604 a year.

INCOME CAN'T EXCEED $17,604 AYEAR FOR A FAMILY OF THREE TO QUALIFY FOR COVERAGE.

The ceiling is a bit higher for pregnant women and those with children younger than 5.

KIDSCARE PROGRAM

For the KidsCare program, which requires families to pay a small premium, a family's household income can't exceed 200 percent of the federal poverty level, or $35,208 a year for a family of three.

INCOME CAN'T EXCEED $35,208 A YEAR FOR A FAMILY OF THREE TO QUALIFY FOR COVERAGE.

To see qualification criteria, go to www.ahcccs.state.az.us.

Obtaining the records behind this report

To do this story, The Arizona Republic obtained documents the state didn't want released.

Concerns about patient confidentiality led the state to refuse to provide a full list of employers who had workers enrolled in AHCCCS, the state's insurance program for the poor.

After legal challenges, The Republic was provided a list of the 15 largest employers with clients on AHCCCS.

On May 7, The Republic filed a public-records request with the Arizona Department of Economic Security, which compiles the data and in 2005 provided similar information. The agency declined the request, saying that the state had changed the way it stored employer data and that it was now confidential. When The Republic filed another request, the Attorney General's Office declined, saying that DES did not maintain the records and was not required to generate them.

On July 30, the Attorney General's Office notified the paper that the reasons previously given for denial were inaccurate and that DES had found a way to comply. However, DES would need permission from AHCCCS because of patient-privacy concerns.The Republic negotiated with AHCCCS to have a statistician review the data to make sure there would not be any violations of the Health Insurance Portability and Accountability Act. The paper received documents in late August.

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Walmart has a change of heart, decides to maintain DRM servers

By Darren Murph,
engadget
October 10th, 2008                        [back to top] 

Back by popular demand, it's the Walmart DRM servers! You heard right -- just days after Wally World announced its plans to turn the screw on its digital rights management servers, we're now being shown a big "just kidding." According to an e-mail (posted in full after the break) sent out to previous downloaders, the mega-corp be leaving things as-is for the foreseeable future, and it's all because of "feedback from the customers." In other words, those actions it urged you to take late last month are no longer required, though we'd still back those tracks up on CD just in case. Can't be too careful, you know.

[Thanks to everyone who sent this in]

NOTE: This is a follow-up to our email titled "Important Information About Your Digital Music Purchases" from 9/26/08.

Based on feedback from our customers, we have decided to maintain our digital rights management (DRM) servers for the present time. What this means to you is that our existing service continues and there is no action required on your part. Our customer service team will continue to assist with DRM issues for protected windows media audio (WMA) files purchased from Walmart.com.

While our customer support team is available to assist you with any issues, we continue to recommend that you back up your songs by burning them to a recordable audio CD. By backing up your songs, you insure access to them from any personal computer at any time in the future.

We appreciate your support and patience as we work to provide the best service possible to you. As we move forward with our 100% MP3 store, we'll continue to update you with key decisions regarding our service and your account via email.

Thank you for using Walmart MP3 Music Downloads.

The Walmart Digital Music Team

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Wal-Mart's Political Agenda

David Nassar
Wal-Mart Watch               [back to top] 

Sam Walton, the founder of Wal-Mart, always believed that his company should stay out of politics and stick to retailing.

Too bad his family didn't listen to him. Today, the Walton family sinks millions and millions of dollars into influencing politicians and manipulating the legislative process.

Wal-Mart Watch is proud to launch a new website - WaltonInfluence.com - that tracks and analyzes the Walton family's and Wal-Mart's growing influence on American politics.

Visit it now and see just how much power the Waltons and Wal-Mart have in Washington:

http://www.waltoninfluence.com

The Walton family and Wal-Mart spend millions of dollars every year to fund an extreme right-wing corporate agenda - one that is often in direct conflict with the interests of Wal-Mart's most needy workers and shoppers.

Wal-Mart has lobbied against increasing port security, providing Country of Origin Labeling (COOL) on food products, raising the minimum wage, and implementing a Patients Bill of Rights.

Meanwhile, the Walton family spends tens of millions of dollars supporting legislation that would privatize Social Security, repeal the estate tax and create private school vouchers.

In August and October 2004 alone, Alice Walton gave $2.6 million to Progress for America, the Karl Rove-aligned 527 group largely credited for helping re-elect President Bush with vicious attack ads against John Kerry.

There's a lot more information out there - but you'll need to see it all to believe it. Take a few minutes to explore our new web site and then tell your friends, family and coworkers about it:

http://www.waltoninfluence.com

Wal-Mart wants us to believe that it's a family company - but the only family Wal-Mart cares about is the Waltons.

Thank you for helping spread the word about the Walton family's political influence.

Sincerely,

David Nassar
Wal-Mart Watch

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America's Richest Women

Andrew Farrell,
The Forbes 400
10.09.08                            [back to top] 

Given the current recession, its hard to avoid the irony in this: The two richest women in America have Wal-Mart to thank for their billions.

Alice Walton is the daughter of Wal-Mart (nyse: WMT - news - people ) founder Sam Walton. Christy Walton is Sam's daughter-in-law. Each has a net worth of $23.2 billion, thanks to the ubiquitous discounter, America's largest employer.

In Pictures: America's Richest Women

Alice has a taste for objects you can't find in any Wal-Mart: fine art. She's led her family in hundreds of millions of dollars in donations to the Crystal Bridges Museum. The new art museum will open in 2010 in Bentonville, Ark., the location of Wal-Mart's headquarters.

Christy is the widow of Wal-Mart heir John Walton, who died in a 2005 plane crash. She also is using some of her considerable fortune for art. She recently donated an award-winning yurt--a domed tent used by Asian nomads--to a San Diego museum.

They're just two of the 42 women on our 2008 list of the 400 richest Americans, a rarefied group with a combined net worth of just over $181 billion when we calculated their fortunes at the end of August.

Abigail Johnson ranks as the third wealthiest woman on our rich list with a fortune of $15 billion. The 46-year-old Boston resident helps run Fidelity Investments--the family business and America's largest mutual fund company.

Abigail's grandfather Edward C. Johnson II founded the company in 1946. Her father, Edward C. Johnson III, has served as chief executive and chairman of the company since 1977.

Abigail could be the next to take the helm. Last year's departure of several top Fidelity executives fueled talk that Abigail will succeed her father. She certainly has the experience for the position. Abigail started running her first diversified fund in 1993. She became president of the company's mutual fund division in 2001. Now she runs Fidelity's personal and workplace investing division.

The youngest female billionaire in the U.S. is Margaret Magerko. Her father founded the building materials supplier 84 Lumber in 1956. Thirty-six years later, it was Maggie's turn to take the helm.

She let Home Depot (nyse: HD - news - people ) and Lowe's (nyse: LOW - news - people ) grab the do-it-yourself home improvers. 84 Lumber instead went after contractors and developers. Slowing home building is sapping company sales this year but Magerko is still comfortably in the billion-dollar club. We estimated the 42-year-old's net worth at $1.7 billion in our Forbes 400 list.

Like many of the men on the Forbes 400 list, most of the women made their fortunes the old-fashioned way: through inheritances. But some did it all by themselves. Talk show titan Oprah Winfrey was born in rural Mississippi. When her parents split, she shuttled between various households, living on a pig farm at one point.

Despite the fractured family, Winfrey excelled in school. She decided on a career in media and pursued it with an unwavering determination. Winfrey began working as a radio DJ while still in high school. By 19, she was anchoring a local Nashville, Tenn., news show.

In 1984, she moved to Chicago to host a morning talk show. Her accessible demeanor and ability to empathize with guests drew increasingly large audiences. Now her show airs in 141 countries and draws 46 million viewers a week in the U.S. alone. Forbes estimated the Mississippi farm girl's net worth at $2.7 billion in August.

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Wal-Mart Supplier Accused of Sweatshop Conditions

By Pallavi Gogoi,
Business Week
October 9th, 2008                      [back to top] 

The world's largest retailer, Wal-Mart Stores (WMT), is being accused of buying school uniforms that were made under extreme sweatshop conditions at a factory in Bangladesh.

The JMS Garments Factory in Chittagong, Bangladesh, produces school uniforms that are sold in Wal-Mart stores under the Faded Glory brand name. A report from SweatFree Communities, an anti-sweatshop activist group based in Bangor (Me.), found that workers at the factory work up to 19-hour shifts to finish Wal-Mart's orders under tight deadlines; are made to stand for hours as punishment for arriving late to work; and are frequently subject to verbal abuse and kicking or beatings. Some workers earn as little as $20 each month, the group says—even lower than the country's legal minimum wage of $24 per month.

The report is based on interviews with more than 90 workers conducted away from the factory in workers' homes by a Bangladeshi nongovernmental labor research organization on behalf of SweatFree Communities, a five-year-old nonprofit group funded by activist foundations such as the Solidago Foundation, CarEth Foundation, and Presbyterian Hunger Program. The group works to get commitments from schools, cities, and other employers to buy goods with employee rights in mind. Wal-Mart Asked Group Not to Publish

In August, Wal-Mart received a draft of the report with information about the abuses. On Sept. 30 the company released a statement to BusinessWeek that said: "Consistent with our concern for the workers and their working conditions, we took immediate action when we received the SweatFree draft report. We visited the factory unannounced and then met with the principal factory owner and our suppliers to ascertain conditions. Additionally, we proposed using an independent third party to work with factory management over the next twelve months to monitor factory operations."

Wal-Mart acknowledges that it urged SweatFree Communities several times not to publish its report. In its statement, Wal-Mart said it "offered to partner with them in addressing industrywide issues in Bangladesh." The company pointed out that "there were at least five other brands and/or retailers using the same factory, and felt a collaborative approach partnering with all key stakeholders including governments, suppliers, and nongovernmental organizations would be the best approach to address labor standards in Bangladesh."

SweatFree Communities Executive Director Bjorn Claeson felt that it was fair to single out Wal-Mart, since his group believes it is by far the factory's largest customer. Claeson emphasizes that Bangladesh is known to have among the worst factory conditions in the world and that about 15% of the nearly $11 billion worth of garment orders annually exported from Bangladesh go to Wal-Mart, according to local press reports.

"Wal-Mart has incredible economic muscle in that country," says Claeson. "If it takes the leadership position as a retailer and works with other brands, there is no question that it can really have an impact." Most Factory Inspections Preannounced

The group's refusal to hold back the report drew support from other activist organizations. "People are not going to suppress reports, especially since one of the most important tools organizations like ours have is transparency," says Bob Jeffcott, policy analyst at the Maquila Solidarity Network of Toronto, an activist group that works to improve conditions in factories that make products for multinational companies.

While allegations of sweatshop conditions in apparel factories that produce for Wal-Mart aren't new, the latest report raises questions about the auditing process the chain has set up to monitor its suppliers, most in distant countries. On Aug. 15, 2007, Wal-Mart released its annual "ethical sourcing report" in which CEO H. Lee Scott contended that Wal-Mart conducts more factory working-condition audits than any other company in the world—as many as 16,700 audits at 8,873 factories.

However, at Bangladesh's JMS Garments Factory, workers say that the visits are always preannounced. Managers prepare them for the auditors' visits and threaten to fire them if they tell the truth, employees told the labor research group. One worker, Ritu, is quoted in the SweatFree Communities report as saying: "The day when the Wal-Mart representative comes to visit, everything changes in the factory." Fewer Ethical Sourcing Reports

Wal-Mart spokesman Richard Coyle said the company uses its own staff of 200 people to conduct audits and also supplements that with independent audits. Wal-Mart wouldn't provide any names of third-party groups that conduct its audits.

The retailer's own Web site says that only 26% of its auditors' visits are unannounced. Critics say that reflects an incomplete commitment to improve labor conditions in its supply chain.

"Wal-Mart has taken positive steps on environmental and sustainable issues, but when it comes to working on issues that question its purchasing practices or where its way of doing business would have to change, that's where things hit a wall," says Ruth Rosenbaum, executive director of CREA, a Hartford-based socioeconomic research center that focuses on human and labor rights. Rosenbaum has advised Wal-Mart as part of a group of activists who were invited to be in a Transparency Advisory Committee.

This year, Wal-Mart decided to stop issuing ethical sourcing reports annually, as it had done every year since 2004. Wal-Mart said it now will issue one every two years and will post quarterly progress updates on its Web site. BusinessWeek asked Wal-Mart to point to any updates since last year, but the company didn't provide any. A visit to the company's Web site seems to show that since last year's publication, Wal-Mart has not updated the information on ethical sourcing and its progress.

Fierce debate over Wal-Mart

The Record
October 9th, 2008                            [back to top] 

LODI - A long-proposed Wal-Mart Supercenter on Wednesday night was once again the center of a heated debate in Lodi.

A capacity crowd filled Lodi's Carnegie Forum to argue whether the Planning Commission should approve a 226,441-square-foot Wal-Mart Supercenter at Kettleman Lane and Lower Sacramento Road.

The debate lasted until late into the night. Commissioners did not consider resolutions that would approve a land-use permit, and design and energy specifications by press time.

Proponents - who included Wal-Mart employees and the project's developer, Darryl Browman - touted Wal-Mart's ability to generate tax revenue, jobs and other forms of economic growth.

Opponents argued that a Supercenter would hurt small businesses and grocers. One even threatened to move away if a Wal-Mart was approved.

"I wasn't thrilled when the first Wal-Mart was approved," said Mary Miller of Lodi. "Now, I'm wondering if it's not the right time to sell my house and retire in Carlsbad."

City officials said in order for a Supercenter to gain approval, Browman must comply with a lengthy list of conditions.

The most notable conditions include purchasing 40 acres of farmland within 15 miles of the project and investing a minimum of $700,000 toward improving downtown Lodi.

Browman also must ensure the current Kettleman Lane building is leased to at least 50 percent of its capacity, sell the building to another retailer or put cash toward demolition costs, according to a staff report.

Browman told the commission he has already negotiated a lease for 90 percent of the building.

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Wal-Mart Sparks War Among Big Toy Sellers

By MIGUEL BUSTILLO
and ANN ZIMMERMAN,
Wall Street Journal
October 9th, 2008                                   [back to top] 

Retail price wars are starting early this year, and the latest weapon is the $10 toy -- a signal that retailers are bracing for a rough-and-tumble Christmas shopping season.

Wal-Mart Stores, Inc., which accounts for more than a fourth of U.S. toy sales, last week sent a clear message that it didn't plan to be undersold when it announced 10 well-known toys, including some Barbie dolls and Hot Wheels car sets, for $10.

KB Toys Inc., the nation's largest mall-based toy seller by stores, told Wal-Mart to bring it on. It cut prices to $10 or less on more than 200 toys, including other Hot Wheels sets, Matchbox cars and classic games such as Yahtzee.

Following Wal-Mart's cuts, which were 25% to 40% below the prices of Toys "R" Us Inc. and Amazon.com Inc., Target Corp. began matching prices on three of the four toys it shares with Wal-Mart's $10 list.

Amazon and the individual toy sellers it promotes on its sites also matched prices, but their discounts were offset by shipping charges. A Barbie Mariposa doll cost $10, for example, but had a $6 shipping fee.

The lower prices highlight an emphasis on high-volume staples as retailers gird for a Christmas season in which cash-strapped consumers may favor no-frills basics over flashier merchandise.

M. Eric Johnson, a Dartmouth College professor who follows the toy business, said Wal-Mart is using cheaper toys to "get people into the stores, but not necessarily giving away the store." Supplies of the $10 toys are ample but scattered across store aisles, he said.

"It feels more laser-focused, strategic kinds of moves to drive behavior, but not the good, old Wal-Mart that cuts prices everywhere," said Prof. Johnson. Still, any rival that follows Wal-Mart's cuts on those toys "will definitely be losing money," he added.

Wal-Mart's pinpoint cuts this year contrast with 2003 and 2004, when it slashed toy prices across the board in an aggressive bid to gain a larger share of toy sales. The brash move showcased the enormous pressures the retailer can apply to prices -- and devastated some of its competitors.

Toys "R" Us lost its status as the nation's largest toy seller by revenue to Wal-Mart in 1998. After a bruising 2004 Christmas, it was bought by investors including Bain Capital Partners LLC and Kohlberg Kravis, Roberts & Co. for $6.6 billion.

The Wayne, N.J.-based company now believes it can succeed this year by selling a wider selection. Parents can find Star Wars toys that fit a variety of budgets. It also believes it has a better handle on the season's trendy toys, such as Elmo Live, an animated version of the Sesame Street character that will sell for $59.99 beginning Oct. 14.

Wal-Mart is betting big on Elmo Live, too, and will sell it for $59.88.

Gerald L. Storch, the company's chief executive officer who joined Toys "R" Us in 2006, downplayed the emphasis on lower-priced toys, predicting that parents will continue spending more on toys, despite the economy.

"Christmas will come, and parents will buy toys for their children, just like they have in all the 60 years Toys "R" Us has been in business," he said. "We know some customers will be stretched these holidays, and we plan to meet them. But value is not just about cheapness."

KB Toys declared bankruptcy in 2004 after a cutthroat price war with Wal-Mart. A unit of Prentice Capital Management LP took majority ownership in 2005, and began closing about 150 underperforming stores last November amid continuing problems.

But the Pittsfield, Mass.-based retailer, which now operates about 430 stores, down from more than 1,200, believes it has a winning formula in discount toys. The company sells videogames or two DVDs for as low as $9.98. The items are generally older and less fashionable, but still in demand among cost-conscious parents. "This is going to be a very competitive season, yes, but our sales are robust," said Geoffrey Webb, the company's director of advertising and sales promotion. "Our traffic counts and comp sales are up, and not many retailers can say that," he added.

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Wal-Mart Riverhead opening barred

By KEIKO MORRIS,
Newday
October 9th, 2008                          [back to top] 

A Suffolk County Supreme Court judge has overturned the Riverhead Town Board's approval of plans to construct a 169,547-square-foot Wal-Mart supercenter with a car repair shop and a food center near the Tanger Outlets on Route 58.

Judge Thomas F. Whelan ruled that Wal-Mart's site plan violated the town's zoning codes for that area and the town's comprehensive plan. Whelan also concluded in his decision, issued Monday, that the town board did not have the authority to grant Wal-Mart variances of zoning restrictions.

The supercenter, which the retailer has in other states and which also includes a supermarket and garden center, would have been Long Island's first.

"The Town Board, in its role as site plan administrator, cannot approve site plan applications that run counter to the Town Law, its Comprehensive Plan, and its own zoning code," Whelan wrote. "One of the most cherished principles of our democracy is the respect and deference accorded our governing laws by our citizenry. Town Boards are not exempt from that fundamental ideal."

The judge's ruling addressed two lawsuits filed against the town and Wal-Mart after town board members approved the site plan in June 2007. The lawsuits, which made similar arguments opposing the site plan approval, were brought by the owner of a shopping center on Route 58 and Riverhead residents who are also members of United Food and Commercial Workers Union Local 1500.

"It's a rational, sound, well-written decision," said James Gaughran, a Huntington attorney who represented the Riverhead residents. "I think it will be difficult for them to overturn on appeal."

Town board members weren't immediately available yesterday for comment. The company issued a statement on the ruling.

"We are obviously disappointed in the decision," the company said. "Our customers in the area were very much looking forward to shopping in the upgraded Wal-Mart store that was planned for Riverhead. In addition, the project would have created about 100 construction jobs during that phase of the project, as well as about 100 additional permanent jobs at the store, when construction was complete."

At the time the town board approved the site plans, it gave Wal-Mart variances for zoning laws requiring certain landscaping, parking and building standards. In addition, the board gave the green light for a site plan that ran contrary to the permitted uses for that zoning district, which does not allow for single, freestanding stores, automotive shops or food courts.

"He [Judge Whelan] rejected the town board's attempt to take jurisdiction from its zoning board and transfer it to itself," said Joseph F. Buzzell, a partner at Rivkin, Radler Llp in Uniondale. "This case stands as a guide post to other towns and villages looking to take power from their zoning boards."

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Attention Wal-Mart voters, um, shoppers

By LINDA P. CAMPBELL,
Times Union
October 6th, 2008                                [back to top] 

Some thoughts to ponder the next time you're standing behind 10 people in the slowest line in the local Wal-Mart, grousing that you won't ever shop here again, or at least not until you absolutely need to:

Every week, 137 million Americans file through Wal-Mart, including one of every five women.

Wal-Mart is why you can now pay around $5 a pound for salmon, why double-strength liquid laundry detergent has become ubiquitous.

Wal-Mart shoppers — women, specifically — supposedly are the swing voters who'll decide the presidential election between Sens. John McCain and Barack Obama.

Pollsters and political reporters, from Time to Business Week to Britain's The Financial Times, have been analyzing the campaigns' efforts to woo "Wal-Mart Moms," a shorthand for middle-age white women, mostly lower income and without college educations. Wal-Mart has taken its own snapshots of its shoppers, and here are some of the results that corporate communications VP Mona Williams shared at the recent National Conference of Editorial Writers convention in Little Rock:

People more likely to shop Wal-Mart in August than six months earlier: 54 percent.

Women more likely: 57 percent.

Minorities more likely: 73 percent of blacks, 70 percent of Hispanics.

Political leanings: 63 percent of Democrats more likely to shop Wal-Mart; 48 percent of independents; 46 percent of Republicans; 48 percent of undecideds.

Undecided voters who shop Wal-Mart regularly or occasionally: 71 percent.

Among Wal-Mart Moms, Williams said, 63 percent agreed that "I worry about having enough money to pay for my daily necessities like groceries and rent." Forty-five percent of them consider their financial situation the same as six months ago; 35 percent feel worse off, and 19 percent are better.

A September poll taken in five battleground states (Colorado, Florida, Nevada, Ohio and Virginia) depicts "Wal-Mart Women" as pragmatic and focused on pocketbook issues, a Sept. 23 company memo says.

"Wal-Mart Women" work (74 percent), are married (70 percent), attend church regularly (47 percent), have college degrees (34 percent) and call themselves politically moderate (42 percent), according to that survey. "Wal-Mart Moms," though, are more often married (86 percent), less likely to work outside the home (68 percent) and lean more conservative (44 call themselves Republicans, 34 percent Democrats.)

The common wisdom says that McCain picked Alaska Gov. Sarah Palin to lure Wal-Mart Moms to his camp.

The hunter, fisher, wife and mother, former small-town mayor, regular gal might even shop at the Wasilla Wal-Mart: she did cut the red ribbon when it became a Supercenter last November, after all.

Democratic VP pick Joe Biden, by contrast, was chiding Wal-Mart in 2006 for what he called inadequate wages and employee health benefits.

But the key question isn't whether a President Obama or a President McCain could feel the pain and frustration of Wal-Mart shoppers. (I can't see McCain buying Better Homes and Gardens accessories at Wal-Mart for any of his multiple luxury abodes. Obama probably doesn't pick up his arugula there, though it's available in salad mixes.)

The question is which of the presidential candidates is likelier to have smart, workable ideas for improving the areas that regular people care about and struggle with every day: educating their kids and sending them to college; feeding their families on wages that are stagnating when prices are rising; paying the mortgage, the utilities, the gas to get around, taxes and other essentials; saving for retirement; affording doctor bills and prescription costs.

Which of the vice presidential candidates can bring a big-picture view to the discussion, as well as an understanding of how to get workable legislation through Congress?

These issues aren't important just to Wal-Mart shoppers. And they aren't the only voters the candidates still have to convince.

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Wal-Mart shares fall 4 percent as market drops

Associated Press
10.06.08                                   [back to top]

NEW YORK - Shares of Wal-Mart Stores Inc. fell more than 4 percent Monday amid sharp global market declines as investors appeared pessimistic about whether the U.S. bailout effort will do much to thaw credit markets.

The company's stock, however, wasn't hit as hard as others because the discounter has benefited in a deteriorating economy as consumers stick to bare-bone essentials.

Shares of Bentonville, Ark.-based Wal-Mart (nyse: WMT - news - people ) fell $2.55 to $57.18 in midday trading, dropping earlier in the session as low as $56.78. While the stock hasn't traded that low since July 29, it's still well above its 52-week low of $42.50 set last fall.

Monday's decline came as the Dow Jones industrials tumbled more than 500 points to fall below 10,000 for the first time in four years.

Copyright 2008 Associated Press. All rights reserved

Wal-Mart (WMT) Down 6% on Downgrade, Market Sell-Off

StreetInsider.com
October 6th, 2008                        [back to top]

Shares of Wal-Mart Stores (NYSE: WMT) are down 6% today after an analyst at UBS downgraded the world's largest retailer from Buy to Hold, saying the company is unlikely immune to the worsening economy and increasing competition.

The broad world stock market sell-off is also contributing to today's weakness in Wal-Mart, as even the strongest names feel the pressure.

UBS also cut its price target on Wal-Mart from $66 to $62.

UBS has had a Buy rating on Wal-Mart since June of 2007 and is the 3rd most highly rated analyst covering the stock according to Bloomberg data.

UBS also lowered its price target on a number of other retailers today as part of a call on the entire group: Target (NYSE: TGT) price target from $53 to $47, maintain Neutral rating. Kroger (NYSE: KR) price target cut from $34 to $34, maintain Buy rating. CVS/Caremark (NYSE: CVS) price target cut from $50 to $46, maintain Buy rating. Safeway (NYSE: SFY) price target cut from $28 to $25, maintain Neutral rating. Costo (Nasdaq: COST) price target cut from $67 to $62, maintain Neutral rating. Whole Foods (Nasdaq: WFMI) price target cut from $19 to $17, maintain Sell rating. BJ's Wholesale Club Inc. (NYSE: BJ) price target cut from $45 to $39, downgraded from Buy to Neutral.

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Wirt woman says Wal-Mart wrongfully fired her

By Kelly Holleran,
West Virginia Record
October 6th, 2008                        [back to top]

CHARLESTON -- A Wirt County woman has filed suit against Wal-Mart, alleging she was wrongfully fired after she used her Family and Medical Leave Act multiple times.

Arlene Jett took medical leave from the store to care for her son, who was born in October 2003, according to the original complaint filed in Wood Circuit Court.

Her son had a rare bowel disorder, necessitating 12 months of hospitalization and several surgeries, the suit states.

In 2006, she took time off because of her, her husband's and her son's medical conditions, she claims.

Jett claims her husband is disabled and suffers from several serious health conditions, including chronic high blood pressure and neck and back injuries.

Jett has been diagnosed with Crohn's Disease and depression, according to the suit.

She again took six weeks of unpaid leave in February 2007 after her husband underwent surgery, according to the complaint.

Jett had been working at a Virginia Wal-Mart since Sept. 12, 1994. She transferred to the Parkersburg store in August 2002, according to the complaint.

Throughout her employment, Jett continually received good performance evaluations and raises, the suit states.

But in August 2004, after Jett had been on her first medical leave, she claims she was reprimanded for absenteeism. Jett's supervisor told her she was going to be given a "decision-making day," she claims.

Jett protested because the reason for her leave had to do with son's health condition, according to the complaint.

She called her regional personnel manager and was told that an investigation would take place, the suit states.

Jett claims the manager later told her she could take intermittent medical leave, but that she was never given any information about FMLA.

Jett was told to maintain her own records and to keep track of how much FMLA leave she had left, which she did, according to the complaint.

In March 2005, Jett transferred to the Cleveland Wal-Mart so she could be closer to her son who was in the Cleveland Clinic, the suit states.

The store's assistant manager again warned Jett about her absences after her 2006 time off, according to the complaint.

But Jett brought in her books that tracked her FMLA leave and believed the issue was solved, the suit states.

In 2007, after her husband's surgery, Jett claims she was not allowed any time to take her husband to follow-up appointments with his physican, but still took days to help him and her son.

"She also missed several days due to her own serious health conditions," the suit states.

In July 2007, Jett was handed a written warning, according to the complaint.

Jett claims she again asked if she was allowed to bring in her books and also complained that her management was not keeping track of her FMLA time even though she always gave a reason for her absences.

Her assistant manager told her the store had changed its attendance tracking procedures, and on Aug. 18, 2007, she was placed on a one-day suspension, according to the complaint.

She protested the action, saying most of her absences were due to medical leave, the suit states.

She claims she called the district personnel manager, who told her he would wipe her absences off her record.

In January, Jett was ringing up a customer who was using a WIC voucher to pay for infant formula, according to the complaint.

"Plaintiff misread the voucher and failed to notice that the customer was actually buying a different type of formula than the one covered by the voucher," the suit states.

Jett claims the computer also did not notify her of her mistake.

As a result, her drawer came up $80 short, according to the complaint.

About two weeks later, on Feb. 14, Jett was fired for the incident, the suit states.

At the time she was fired, Jett claims she was told such actions normally result in only a warning, but because of her absences, she was being fired.

Because of her termination, Jett has lost wages and benefits and out-of-pocket expenses, according to the complaint.

She has also suffered emotional and mental distress, humiliation, anxiety, embarrassment, depression, aggravation, annoyance and inconvenience, the suit states.

Jett is seeking the court enter a judgment declaring Wal-Mart's actions to be in violation of public policy.

She is also seeking an injunction ordering the store to establish an on-going training program for its employees on the subject of disability discrimination and medical leave.

Jett is seeking back pay, including all the benefits for which she eligible, and that she be reinstated as a Wal-Mart employee.

She is seeking unspecified compensatory, liquidated and punitive damages, plus the costs of the suit and pre- and post-judgment interest.

Upon Wal-Mart's request, the case has been moved to federal court.

David L. Grubb and Kristina Thomas Whiteaker of The Grubb Law Group in Charleston will be representing her.

Eric E. Kinder and Ellen J. Vance of Spilman Thomas & Battle will be representing Wal-Mart.

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Wal-Mart lab cited for health hazard

By Spencer Hunt,
The Columbus Dispatch
October 4th, 2008                                [back to top]

Workers at a Lockbourne Wal-Mart lab that makes eyeglasses might have been exposed to unhealthy levels of a lens-cleaning chemical, according to the Occupational Safety and Health Administration.

Acetone fumes near one employee were at twice the acceptable workplace limit, according to air samples the agency took in February. Breathing too much of the compound can cause headaches, dizziness, confusion and unconsciousness.

Agency inspectors also cited the lab for not posting lead-hazard warnings in an area where particles of the toxic metal could be airborne and for keeping incomplete records about employee injuries.

Wal-Mart spokespeople and agency officials declined to comment on the case, because the company has challenged the citations. A hearing before Occupational Safety and Health Review Commission Judge Stephen J. Simko Jr. is set for Oct. 21 at the U.S. District Courthouse in Columbus.

In March, the agency ordered Wal-Mart to pay $5,675 in fines and install ventilators or change work practices at lab stations where employees use acetone.

In a May 29 brief filed with the review commission, Wal-Mart denied violating workplace safety standards and argued that the demanded changes aren't necessary.

The company opened the lab in 2002 to help make eyeglasses ordered by customers at Wal-Mart and Sam's Club stores across the country.

It's not clear how many people work there. An Aug. 2001 news release from former Gov. Bob Taft said the lab was expected to create 600 jobs.

Deborah Zubaty, Columbus area director of the Occupational Health and Safety Administration, said a settlement might be reached before the hearing takes place.

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Are Wal-Mart’s Changes Enough to Quiet Critics?

By Sarah Amandolare,
Finding Dulcinea
October 3rd, 2008                               [back to top]

Having made efforts to go green, Wal-Mart is now tackling child labor by boycotting cotton from Uzbekistan; but will the mega-retailer ever be fully embraced by critics?

Stepping Forward or Digging Deeper? Although it has been heavily criticized in the past, retail giant Wal-Mart has won over some critics, including environmental groups, for changing some practices and policies. However, there are many critics who contend that Wal-Mart’s business model is ultimately unsustainable, intrinsically immoral and part of a larger issue that has yet to be addressed: the dominance of big-box retail chains in America and their subsequent effect on both the environment and the global economy. The question remains, should critics keep trying to beat Wal-Mart, or finally join them?

Wal-Mart’s first green initiatives began “as a marketing campaign and nothing more,” according to Mark Hughes, director of the Martin Agency, Wal-Mart’s ad firm. However, Hughes told Advertising Age that in his observation, “Wal-Mart has become a true believer in sustainability.”

For example, in 2005, Wal-Mart’s chief executive H. Lee Scott unveiled “a set of sweeping, specific environmental goals,” including reducing energy usage, addressing fuel efficiency and packaging, and urging its suppliers to do the same, according to The New York Times.

Furthermore, in April 2008, Wal-Mart Stores Inc. began supporting organic farming by purchasing millions of pounds of cotton from farmers committed to “changing over from conventional to organic farming,” Reuters reported. According to CNN Money, observers of the retail industry believe Wal-Mart was initially hesitant to embrace organic products because the company was uncertain how its “low-income consumers” would respond. Wal-Mart changed its tactics once “going green” became mainstream.

In Wal-Mart’s latest effort to “improve its record on social and environmental sustainability,” it has joined others in boycotting cotton from Uzbekistan, which uses forced child labor, reports the Financial Times. The boycott is Wal-Mart’s most “sweeping action over sourcing issues,” indicating a commitment to social consciousness. Wal-Mart was also instrumental in bringing U.S. retailers and cotton importers together to address the Uzbekistan issue earlier this year.

In response, some critics have praised Wal-Mart, while encouraging the company to do even more. But others contend that no matter how much Wal-Mart does to lessen its carbon footprint or support organic farming, the company will never be sustainable.

Though Jim Nicolow of American Public Media acknowledged that Wal-Mart “has a long way to go” and “a lot to make up for,” he also offered words of support. Nicolow writes, “[I]t’s undeniable that this leading retailer can help transform the business world toward sustainability.” He encouraged Wal-Mart to begin placing carbon labels on products to “give consumers the opportunity to reward producers that lower their greenhouse gas emissions.”

But Nicolow’s encouragement and acceptance of Wal-Mart is precisely what other critics contend is the problem. Stacy Mitchell of Grist.org believes that Wal-Mart’s green initiatives have “distracted” environmentalists, journalists and consumers from the fact that “big-box retailing” is “intrinsically unsustainable.” When environmental groups laud Wal-Mart, they are “implying that this method of retailing goods can, with adjustments, be made sustainable,” Mitchell writes. Furthermore, “they are helping Wal-Mart expand,” she concludes.

Background: Uzbekistan child labor

In Oct. 2007, the BBC released a documentary about child labor in Uzbekistan, showing children “being forced to work in cotton fields instead of going to school.” The BBC journalists who filmed the documentary were arrested at one point, but managed to salvage their footage.

Uzbekistan has a “brutal authoritarian regime” that administers “widespread torture,” and killed hundreds of peaceful demonstrators in 2005.

After the BBC documentary came out, “several international companies said they would stop buying Uzbek cotton,” according to the United Nations Refuge Agency. Among the participating retailers were Sweden’s H&M and Finland’s Marimekko. However, the U.S.-based International Cotton Advisory Committee, which “promotes the world cotton trade,” deemed the allegations against Uzbekistan “‘exaggerated’ and ‘absurd.’”

Reference: International Cotton Advisory Committee The International Cotton Advisory Committee claims that it works to raise awareness and promote cooperation regarding world cotton production, consumption, trade and stocks. The Committee also represents the international cotton industry before the United Nations. Source: International Cotton Advisory Committee

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Battle Brewing Over Civil War Battlefield

By Liz Nagy,
NBC 29
October 3rd, 2008                                    [back to top]

A battle is brewing in Orange County over a civil war battlefield. The players are Wal-Mart, county leaders, and people who want to protect the Wilderness Battlefield National Park.

Wal-Mart wants to build a supercenter on Route 3 just across from Wilderness Battlefield National park. The county says it does not have a formal proposal, but groups like the Park Service and Piedmont Environmental Council already do not like it.

Dan Holmes of the Piedmont Environmental Council said, "Most of the population on the Route 3 corridor is several miles up the road from this battlefield. If you're going to be talking about future commercial we feel like it would be in the best interest of the county to target that closest to where the population is."

According to Brent Lawrenz of the Civil War Preservation Trust, "It's going to put a tremendous pressure on Route 20 which is 2 lanes and they're proposing to re-route part of it through key battleground area."

These groups claim they will lose tourism dollars, and land that needs to be preserved but the other side claims the town cannot afford not to do it.

Orange County Administrator Bill Rolfe said, "We can't afford some of the things we're doing and some of the projects that we need to do with out expanding and diversifying our tax base. Just looking at a Wal-Mart you're talking about 1/2 a million dollars a year in revenue which is over a penny on the tax rate."

Nobody is saying when development would start. In the end, both sides say they are work out an agreement to bring in both commercial money and tourists.

Neither Wal-Mart nor developers were available for comment.

Once official proposals for development on the shopping centers are in, the public will have a chance to voice their opinion on the issue.

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Wal-Mart outlines Marketside vision

just-food.com
2 October 2008                      [back to top]

Wal-Mart has revealed that its new Marketside stores will boast a product line-up focusing on fresh foods and prepared meals at "everyday prices".

The company, which is gearing up to open its first Marketside outlets at locations around Phoenix later this week (4 October), said that it will offer "restaurant quality" food without a premium price-tag.

Marketside will carry pre-prepared side dishes like mashed potatoes for US$2, personal-size pizzas for $4, individual serving-size lasagne for $6 and family-size penne pasta with chicken for $8.

"Whether you need a few last-minute ingredients or a prepared meal you can heat and serve, Marketside is here to bring fresh groceries to our new neighbours in Phoenix at great prices," said Mike Darrow, manager of Marketside's Mesa location.

The Marketside stores are designed to serve consumers living in close proximity and, being half the size of a conventional supermarket, are "built to help customers get in and out quickly", the company said.

Emphasising its value credentials, Wal-Mart also revealed that it will offer household brands for "unbeatable prices".

When contacted by just-food, Wal-Mart declined to comment on its Marketside store concept because it "is a very small-scale pilot".

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Wal-Mart's Early Christmas

Carl Gutierrez,
10.01.08                                    [back to top]

Christmas is coming early for Wal-Mart. Expecting a weak holiday shopping season, the company announced Wednesday it would be cutting prices on several toys in 3,500 stores across the U.S.

Wal-Mart (nyse: WMT - news - people ) said it made the call after conducting a survey that showed consumers will start Christmas shopping earlier this year in order to stretch their holiday dollars.

Though Wal-Mart caters to low-income shoppers, retailers have been hurt by sluggish spending due to rising food and energy prices, the housing slump and a generally weak economic climate. (See "Trouble On The Street For Retail.") The industry doesn't see a quick fix to those trends and is anticipating a subdued holiday season.

Wal-Mart's shares were effectively flat, losing only 0.03%, or 2 cents, to $59.87, in morning trading. The reaction may appear to send a message of indifference, but the price was strong compared with the Dow Jones industrial average, which fell 1.6%, or 170.05 points, to 10,680.61.

Wal-Mart said it will cut prices on 10 popular toys to $10.00 each, including certain Barbie Dolls, Play-Doh Ice Cream Shop, specific Hot Wheels toys and Bakugan by Spin Master, a game many experts cite as one of the "hot" toys this year.

It will also open Christmas shops within its stores over the next 10 days, which will offer deals such as an ornament value pack for $5.00.

Thanks to its size, Wal-Mart has fared better than its industry peers through this weak period by aggressively cutting prices. Last month, the company reported an increase in August same-store-sales, while others such as J.C. Penny faltered. (See "Wal-Mart Rises Above The Fray.")

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Wal-Mart recalling 210,000 toasters

The Dallas Morning News
October 1st, 2008                                   [back to top]

Three recalls have been announced.

Wal-Mart Stores Inc. said Tuesday that it is recalling about 210,000 toasters that may cause electrical shocks and fires.

The toasters, manufactured in China and sold at Wal-Mart stores throughout the U.S. under the General Electric Co. brand for $17 to $28, may produce a short circuit between the heating element and the bread cage that causes sparks, according to a statement issued by the U.S. Consumer Product Safety Commission and posted on Wal-Mart's Web site.

While 140 cases of shocks or fires have been received regarding the products, sold from September 2007 through July, there has been no report of injury, according to commission spokeswoman Patty Davis.

In other recalls:

•The CPSC also announced the recall of about 5,000 Kviby chests, manufactured in Denmark by Ikea Home Furnishings.

The company received three reports of cuts from glass knobs that can break.

The chests were sold at Ikea stores between August 2007 and July 2008.

For details, call 1-888-966-4532 or visit www.ikea-usa.com or www.cpsc.gov.

•About 200 toy boats, made in India and imported by Buzz's Boatyard, were recalled because the paint contains high levels of lead, which is toxic if ingested by children. No injuries have been reported.

The boats were sold at www.buzzboats.com between April and November 2007.

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Pepe Jeans Sues Master P and Wal-Mart for Trademark Infringement

By Matthew Lynch,
WWD Business
October 1st, 2008                            [back to top]

Hip-hop entrepreneur Percy Miller might be glad he only occasionally goes by the nom de plume Master P these days. A new lawsuit alleges he isn’t exactly the master of that particular letter.

Pepe Jeans London LLC has accused the rapper, Wal-Mart Stores Inc. and manufacturer Happy Nation Inc. of trademark infringement for the use of the letter P in the logo for his P. Miller clothing line.

According to documents filed in federal court in Manhattan on Sept. 26, the logo infringes on the Pepe Jeans P logo, a stylized P enclosed in a circle. The complaint also alleges the logo’s placement on the hangtags infringes on Pepe’s tradition of displaying its P mark on a round plastic tab halfway down the tags of its merchandise.

The rapper brought the P. Miller line to Wal-Mart earlier this year. His son, the recording artist Romeo, also endorses the low-priced urbanwear collection.

Pepe and its co-plaintiff and licensee Jean Design Ltd. are seeking an injunction against the use of the logo, all profits and damages that ensued from infringing activities, legal fees and unspecified damages.

A representative from Wal-Mart said the company had not yet been served with the suit, but that it would review the case and respond appropriately. Miller’s attorney of record did not return a call seeking comment, nor did a representative for Happy Nation

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In early holiday push, Wal-Mart cutting toy prices

By Nicole Maestri,
Reuters
October 1st, 2008                              [back to top]

NEW YORK, Oct 1 (Reuters) - Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research, Stock Buzz) is cutting prices on popular toys and ramping up the opening of Christmas shops in its U.S. stores as the retailer tries to win sales from cash-strapped shoppers ahead of what could be the worst holiday season in 17 years.

Wal-Mart said on Wednesday that it will sell ten toys, including certain Barbie dolls and Tonka trucks, for $10 each. It is also putting its Christmas shops on the "fast track" and intends to open the shops, which sell ornaments and holiday decor, in its stores nationwide by Oct. 10.

Wal-Mart spokeswoman Linda Blakley said its shoppers, who are increasingly living paycheck to paycheck, are indicating that they will start their holiday shopping earlier this year to stretch their limited budgets.

"Given current conditions, some (shoppers) need to spread out their Christmas shopping over a longer time-frame than they may have last year," she said.

Last year, Wal-Mart cut prices on hot toys on Sept. 30 to try to persuade hesitant shoppers to spend on holiday items.

But this year, retailers are bracing for what some economists predict could be the worst Christmas season since 1991, when the nation had only recently emerged from a recession.

Consumers, battered by the housing market downturn, surging food and fuel costs, a credit crunch, and a weakening job market, have shown an increasing reluctance to spend this year. The recent turmoil on Wall Street and in the stock market has only made the outlook for the season only more precarious.

This year, Wal-Mart has been heavily emphasizing its low prices, and its sales have been outpacing those of its competitors as shoppers head to its stores for discounts on food, toiletries and electronics.

To deal with the tough economy, Wal-Mart said shoppers are indicating they will purchase less expensive items, to start their Christmas shopping earlier or purchase presents for fewer people on their list.

Wal-Mart is not alone in trying to get shoppers into the holiday mood. Macy's Inc (M.N: Quote, Profile, Research, Stock Buzz) has set up its Holiday Lane Christmas shops in its stores, while discount retailer Target Corp (TGT.N: Quote, Profile, Research, Stock Buzz) is also selling holiday ornaments and decor.

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VIDEOS

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Fighting Wal-Martization 25min. (2005)

A new video by The Labor Video Project 25 min. (2005)

Wal-Mart is now the largest private employer in the United States and has the same impact that General Motors had nearly 50 years ago. This 26-minute video shows why working people and trade unionists are fighting back and what Wal-Mart has in store for the communities it is seeking to build stores in. "Fighting Wal-Martization" is a hard hitting documentary that looks at how the constant price cutting not only drives local small businesses out of the community but how this ends up driving down the living conditions of the very people who shop at Wal-Mart. The video also looks at the healthcare crisis and how Wal-Mart increases its profits by sending it¹s employees to public hospitals to get treatment thereby shifting costs back onto the taxpayer. This video can be used at union meetings, community meetings and on cable TV to get the message out about the Wal-Martization of America and what it means to every working person.

Please mail your check of $20.00 and order form to

Labor Video Project
P. O. Box 720027,
San Francisco, CA 94172

For more info: lvpsf@labornet.org, (415) 282-1908

Wal-Mart: The High Cost of Low Prices (www.walmartmovie.com)

Independent America: The Two Lane Search for Mom & Pop (www.independentamerica.net)

Big Box Mart (www.jibjab.com)

Garth Brooks Parody (www.walmartworkersrights.org)

"Is Wal-Mart Good for America?" Frontline, PBS Video, (www.pbs.org)
 

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BOOKS

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NON-FICTION

The Case Against Wal-Mart By Al Norman Raphel Marketing ruth@raphael.com

Wal-Mart: The Face Of Twenty-First Century Capitalism Edited By Nelson Lichtenstein The New Press www.thenewpress.com

The Great Risk Shift: The Assault on American Jobs, Families, Health Care and Retirement By Jacob S. Hacker Oxford University Press www.oup.com

War On The Middle Class: How the Government, Big Business, and Special Interest Groups Are Waging War on the American Dream and How to Fight Back By Lou Dobbs Viking, a member of Penguin Group www.penguin.com

Momentum: Igniting Social Change in the Connected Age By Allison H. Fine Jossey-Bass www.joseybass.com

Big-Box Swindle: The True Cost of Mega-Retailers and the Fight for America's Independent Businesses, By Stacy Mitchell, www.beacon.org www.newrules.org

Wal-Mart: The Face Of the Twenty-First-Century Capitalism, Edited by Nelson Lichtenstein, Published by The New Press www.thenewpress.com

 The Bully Of Bentonville - How the high cost of Wal-Mart's Everyday Low Prices is Hurting America, By Anthony Bianco, Published by Doubleday
Email: specialmarkets@randomhouse.com

 How Wal-Mart is Destroying America (and the world), By Bill Quinn, Published By Ten Speed Press, Box 7123, Berkeley, CA 94707, www.tenspeed.com (pp. 163)

Slam Dunking Wal-Mart, By Al Norman, Published By Raphel Marketing, 12 S. Virginia Avenue, Atlantic City, New Jersey 08410, www.sprawl-busters.com (pp. 237)

The Great American JobsScam, By Greg LeRoy, Published By Barrett-Koehler Publishers, Inc., 235 Montgomery Street, Suite 650, San Francisco, CA 94104-2916, www.bkconnection.com (pp. 257)

Nickel and Dimed, By Barbara Ehrenreich, Published By Henry Holt and Company, LLC, 115 West 18^th Street, New York, NY 10011, www.henryholt.com (pp.221)

United States of Wal-Mart, By John Dicker, Published By Jeremy P. Tarcher (Penguin Group usa), www.us.penguingroup.com (pp.257)

The Wal-Mart Effect, By Charles Fishman www.penguin.com

Megamall On The Hudson, By David Porter and Chester L. Mirsky www.trafford.com

FICTION

Death By Discount, By Mary Vermillion, Published By Alyson Publications, P.O. Box 4371, Los Angeles, CA 90078-4371, www.maryvermillion.com (pp. 275)