Article

Wal-Mart starts selling coffins

Orange County seeks dismissal of Wal-Mart challenge

By Anthony Clark,
The Gainesville Sun
October 30th, 2009                             [back to top]  

Wal-Mart has lost its bid to have the city development review board reconsider its plans to build a Supercenter in northwest Gainesville.

Administrative law Judge Bram Canter upheld the board's decision that the retail giant's development plan was inconsistent with the city's comprehensive plan and zoning for Mixed Use 2, saying that "competent substantial evidence" presented at board hearings supported the decision.

Wal-Mart has 30 days from Wednesday afternoon's ruling to appeal.

The company was proposing a 186,000-square-foot Supercenter, a 14,000-square-foot garden center and two outparcels of 3,000 and 5,000 square feet on a 32-acre parcel at Northwest 34th Street and Northwest 23rd Street.

The board of city residents appointed by the City Commission voted 4-3 on July 9 to deny Wal-Mart's application.

Wal-Mart appealed the decision, saying the board misinterpreted the city's comp plan and land regulation codes. Canter heard evidence Oct. 5 at the county civil courthouse.

Asked whether Wal-Mart would file new plans for the site or seek a different location in northwest Gainesville, spokeswoman Cindi Marsiglio said, "We are evaluating our options. We just found out, so that is about the extent of our comments."

This marks the fourth time Wal-Mart has been turned down for a Supercenter in northwest Gainesville, with environmental concerns raised about the other locations. Wal-Mart acquired the property rights to the Northwest 34th Street location at the same time it acquired the rights to the current Supercenter site off of Waldo Road in east Gainesville.

Contrary to some public criticism of the decision, it was not a question of whether Wal-Mart should build on the site, "it was a question of what design was going to be approved," said Elizabeth Waratuke of the City Attorney's Office, who defended the board in the appeal.

She pointed out that the board tried to give Wal-Mart two last opportunities to come back with new plans. The first time, the board expressed concerns that changes did not go far enough. Before the final vote, Wal-Mart's local attorney, Ron Carpenter, said the company has a business plan that works for it and that he didn't think the company would move to the setback line - the distance from the road or other line within which no buildings may be erected.

In its appeal, Wal-Mart contended that the city planning staff had incorrectly set the boundaries for the "block face" - the front of the property - from which building setbacks are measured. A boundary that instead took in adjacent commercial buildings would have given Wal-Mart grounds to build farther from the line, consistent with the other buildings.

But Canter ruled that argument moot since Wal-Mart never objected to the block face boundary to the board and actually adopted the block face in its plans.

Wal-Mart also argued that the board misinterpreted provisions of the land code that should have allowed the two smaller outparcels to meet the 15- to 80-foot setback requirement for mixed use 2, against the advice of city staff.

Canter ruled that the code does allow the board to require the main building to meet the setback requirements and that the board is not required to abide by city staff's interpretation of the law.

He also wrote that the board had the same discretion to deny a deviation to the rule as it did to approve one, which Wal-Mart had argued it must do.

Canter also noted that Wal-Mart did not address all of the reasons for denying its plans, any one of which could have been grounds for denial.

Board members' comments during hearings included concerns that the design was not "walkable," would create unacceptable noise levels, was not an appropriate design and was not integrated with the surrounding land uses, as required for the zoning.

John Hudson, who owns property near the proposed site, hired urban planners who testified against the appropriateness of the plans during board hearings and was an intervenor on the city's side in the appeal.

He said Thursday that the ruling is not about who won but about improving the development review process in Gainesville. The city's planning staff could learn a lot by reviewing the case, he said.

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Wal-Mart, others suspend business with Mich. fruit grower fined for child-labor law violations

By James Prichard,
Associated Press
October 30th, 2009                      [back to top]  

GRAND RAPIDS, Mich. — Wal-Mart and two other top retailers said Friday they are suspending business with a large southwestern Michigan blueberry grower after investigators found children as young as 6 working in the grower’s fields.

Wal-Mart, Kroger and Meijer said pending further information, they have stopped buying products from Adkin Blue Ribbon Blueberry Co. near South Haven, about 85 miles northeast of Chicago.

Adkin general manager Tony Marr said the company has a strictly enforced written policy prohibiting young children from working in its fields. All adult employees must sign copies of the policy, and the farm keeps the signed copies on file, he said.

“We certainly don’t condone or promote child labor here in any way,” Marr said.

The company has eight full-time employees and hires about 350 seasonal workers each year to harvest and process the blueberries grown on its 640 acres. About one-third of its berries are processed for sale as fresh produce and the rest are frozen for commercial use.

Adkin is conducting its own investigation to determine what happened, he said. Parents sometimes bring children with them because they don’t have child care, he added.

“Wal-Mart, Kroger and Meijer are very large customers of ours, and certainly we’re cooperating with them in providing information about our internal investigation, trying to figure out what the kids were doing there,” Marr said.

The U.S. Department of Labor announced this week that a check of 35 randomly selected farms in Michigan led to eight being fined about $36,000 in all for violating federal migrant-housing and child-labor laws.

Ten other farms were cited for violations but not fined. Adkin was the lone farm fined for both migrant-housing and child-labor law violations and paid more than $5,500 in penalties, said Scott Allen, a department spokesman based in Chicago.

Wal-Mart Stores Inc. spokeswoman Caren Epstein said the Bentonville, Ark.-based retailer learned of the problem after being contacted by ABC News. Wal-Mart will not buy anything from Adkin “pending the outcome of an investigation by our ethical sourcing team,” Epstein wrote in an e-mail.

Representatives of Cincinnati-based Kroger Co. and Grand Rapids-based Meijer Inc. made similar statements.

Thomas K. Thornburg, co-managing attorney of Farmworker Legal Services, said labor law violations are rampant among farms that use migrant workers.

“This isn’t one abusive employer,” he said.

Federal law does not allow children younger than 12 to work on farms. Children who are 12 or 13 can have nonhazardous farm jobs outside of school hours if they work on the same farm as their parents or with written parental consent.

Labor Department investigators found four children working in Adkin’s fields during an unannounced visit on July 8. At least two of the children were under 12, including the 6-year-old.

Michigan is the nation’s largest blueberry producer, with 110 million pounds harvested in 2008.

During inspections throughout the state, investigators found migrant workers living in unlicensed migrant labor camps with sewage from a faulty septic system seeping up near living units. They also discovered untreated waste water spilling out of broken pipes, no hot water for hand washing and infestations of bugs and rodents.

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Wal-Mart manager bans veterans groups from fundraising at store

By Barbara Czura,
WAFF News
October 30th, 2009            [back to top]  

ARAB, AL (WAFF) - Veterans organizations are fired up after a Wal-Mart manager banned solicitors or fundraisers at his store. They're not upset about the change of policy, but because the manager's allowing another organization to still raise money.

The Disabled American Veterans were allowed to raise money on Memorial Day, but when they asked to come back for another fundraiser a few weeks later, the manager's policy had changed.

DAV post commander Bill Brennan, Walt Dempster, and Steve Shaver are all members of veterans organizations in Arab. Each organization raises money throughout the year and all proceeds goes toward disabled veterans and their families.

In years past, Brennan said they've always been welcome at the Wal-Mart in Arab, but not anymore.

"He told us he's getting a lot of complaints for solicitations out in front of the stores from customers," Brennan said.

"It doesn't seem right to me to do mass punishment, because some group stood there and grabbed you and said, 'I want money,'" Dempster said. "Okay, I wouldn't appreciate that either.

Post commander of Veterans of Foreign Wars Post 6226 Dempster said due to a few complaints, all solicitors are being banned from the store.

"The way I understand the word solicit means you're asking for something," he said. "When we're out there, I hand you [a flyer], just like that. Did I ask for any money? No. Now if you want to make a donation, will I accept it for the VFW, yes.

A two-day fundraiser in a busy place like Wal-Mart usually raises about $1,800, Brennan said.

"The money is quite important to us, we can't operate without it," he said.

But Dempster said the Wal-Mart manager is making some exceptions. He said it's corporate policy for every Wal-Mart Mart to support the Salvation Army. So come Christmas, one group will be allowed while the others aren't.

WAFF 48 News contacted the manager of the store and asked for an on-camera interview, but he declined.

"I don't feel that you can allow one organization regardless of who they are, to do something and not the others," Dempster said.

In the past two days, WAFF 48 News has left several messages with Wal-Mart's corporate office, but the calls were not returned. However, it has been learned that each store's manager can determine the individual store policy.

As for the veterans organizations, they were given permission by the manager of Wal-Mart in Guntersville and will be out in November accepting donations for Veterans Day.

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Wal-Mart starts selling coffins

BBC
October 30th, 2009                 [back to top]  

Prices range from a "Mom" or "Dad Remembered" steel coffin for $895 (£540), to a bronze model at $2,899. The retailer is allowing customers to plan ahead by paying for the caskets over 12 months for no interest. They can be dispatched within 48 hours. Catering for cradle-to-grave needs, Wal-Mart already sells everything from baby wear to engagement rings. A spokesman for the supermarket giant, Ravi Jariwala, said the new coffin range was "a limited beta test to understand customer response". The retailer is offering caskets at prices that undercut many funeral homes, say correspondents. But an industry spokesman said it was not unduly concerned about Wal-Mart's move, because he said the firm could not offer bereaved families the human touch. Pat Lynch, of the National Funeral Home Directors Association, told AP news agency: "There's no question in my mind as a funeral director for nearly 40 years that the most critical element is the human contact."

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Walmart.com glitch keeps shoppers from checking out

By Nicole Maestri,
Reuters
October 29th, 2009                    [back to top]  

SAN FRANCISCO (Reuters) - Wal-Mart Stores Inc's website is experiencing technical issues that are keeping some customers from making online purchases, the company confirmed on Thursday.

"We've experienced some unexpected technical issues that have resulted in intermittent availability of checkout for a limited number of customers," said Walmart.com spokesman Ravi Jariwala. "We're working to quickly resolve the matter."

Customers who are affected by the glitch can browse Walmart.com and add items to a virtual shopping cart. But when they click on the cart to check out, the website says the cart is empty and no purchase can be made.

The glitch comes as Walmart.com is making an aggressive push to grab market share. It has slashed prices on yet-to-be-released hardcover books, igniting a price battle with Amazon.com. It also recently began selling health and beauty items, as well as caskets.

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Judge approves $85M class action against Wal-Mart

By Lisa Call,
The Dickinson Press
October 30th, 2009                  [back to top]  

Several hundred former and present North Dakota Wal-Mart Stores Inc. employees may see some money flow their way.

A Nevada federal court judge gave final approval Wednesday to an $85 million class-action lawsuit against Wal-Mart Stores Inc. amid a wage and hour dispute.

Involving 30 states and more than 3 million hourly employees, the suit claimed Wal-Mart employees were asked to work off the clock and breaks were cut short or not given consistently.

“The policy was a little off and didn’t really go with the law,” said Kevin McMillan, assistant to Robert Bonsignore, national lead counsel for the employees. “It’s anything but an isolated occurrence.”

Hourly employees who worked for Wal-Mart in the year 2000 and beyond may file a claim.

“They were requested to take shorter breaks,” said Mike Miller, a Fargo-based attorney and North Dakota counsel for the suit.“That’s the primary focus of the overall settlement — is those cases.”

Rose Kostelecky, a 19-year-veteran employee of Dickinson’s Wal-Mart Supercenter, said she has never been asked to work off the clock.

“I have never, myself, never ever worked off the clock,” Kostelecky said. “They’re very strict about that. I know that nobody here does.”

While it is nearly impossible to know if the incidents occurred at every Wal-Mart store, there is enough evidence to show that it happened, Miller said.

“Wal-Mart is not admitting they did anything wrong,” Miller said. “But litigation is litigation. We feel it’s better to settle it at this point than go forward with it any further.”

The last day for eligible North Dakota Wal-Mart employees to submit a request for a portion of the settlement is Nov. 9, according to a press release.

Employees have 30 days after the entry of judgment to file an appeal, Miller said.

“The people that are part of it can protest it if they’re not in agreement with it,” Miller said. “If in fact somebody objects, it could definitely delay payment for quite some time.”

Management at Dickinson’s Supercenter Wal-Mart declined comment.

Michelle Bradford, senior manager of corporate communications at Wal-Mart headquarters in Bentonville, Ark., said the company has no further comment beyond a December 2008 press release.

“Resolving this litigation is in the best interest of our company, our shareholders and our associates,” said Tom Mars, executive vice president and general counsel, in the release. “Many of these lawsuits were filed years ago and the allegations are not representative of the company we are today.”

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Lawsuit Filed Over Merced Walmart Distribution Center

KMPH Fox 26
October 29th, 2009                    [back to top]  

Opponents of a Merced Wal-Mart Distribution Center are taking their battle to court.

They filed a lawsuit Thursday morning in Merced County Court over the one-million-plus square-foot building which would be located at Childs Ave. and Tower Road in Merced.

The lawsuit alleges the city of Merced violated the California Environmental Quality Act when it approved a massive, controversial, Wal-Mart distribution center.

Opponents say the environmental hazard is too great, claiming it would translate into more trucks in and out of Merced; which would adversely affect the air quality.

However supporters say the region needs the jobs, with the city facing one of the state's highest unemployment rates. They argue that the 900 full time jobs expected to be available at the warehouse once it opens is what the community needs right now.

City leaders voted to approve construction on the distribution center last month.

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Wal-Mart foes target Merced distribution center plan in suit

Groups contend not enough is being done to mitigate impacts.

By SCOTT JASON
mercedsun-star.com                   [back to top]  

Wal-Mart distribution center opponents said Tuesday they found flaws in the environmental review and will file a lawsuit demanding more be done to minimize the center's impact.

"We should be commended for picking up the torch that has been dropped," Merced Sierra Club Chairman Rod Webster said.

The case will be filed either today or Thursday in Merced County Superior Court. Sacramento attorney Keith Wagner, who represents the opponents, is still finishing up his arguments. A copy of the appeal was unavailable.

The lawsuit will probably call on the city to make Wal-Mart do more to reduce air and water pollution.

The Merced City Council voted to approve the project last month after three years of studies and six hours of public debate. During the meetings, supporters outnumbered opponents roughly by a 2-1 margin.

The acrimony surrounding the project, which subsided in the past month, will swell once more.

Merced County Jobs Coalition President Doug Fluetsch said it's the city's job -- not the opponents' -- to decide whether a project has been properly reviewed. "There are a handful of people in Merced who want to ruin it for everybody else," he said. "It makes me sick."

Opponents, Fluetsch said, were penalizing every unemployed person in Merced because they're delaying the 1,200 jobs that will be created by the 1.2-million-square-foot distribution center.

Merced City Attorney Greg Diaz said the environmental impact report is solid. "This (impending lawsuit) is not unexpected," he said. "We anticipate a vigorous battle on both sides."

The city's legal bills will be paid by Wal-Mart, a requirement of the project's approval. The city hasn't yet hired a firm, though it's been in talks with Rutan & Tucker.

No lawsuit brought under the California Environmental Quality Act can stop a project. It only causes delays.

Merced Alliance for Responsible Growth chairman Tom Grave said the case could be wrapped up in two months if Wal-Mart is willing to negotiate.

If not, it could drag on in the court system for a year or more. The case could go before Presiding Judge John Kirihara, Judge Carol Ash or a visiting judge.

Grave said more needs to be done to reduce pollution from the diesel trucks that will cycle through the complex between Child and Gerard avenues.

The attorney will argue air quality impacts weren't properly addressed by EDAW, the firm that analyzed the project. Grave said EDAW improperly relied on standards set by the San Joaquin Valley Air Pollution Control District.

As with any part of an environmental lawsuit, the argument is fairly technical. The gist is that one project may not be deemed significant for air pollution if fewer than 10 tons a year of each kind of emission is released.

But several insignificant projects taken together could lead to major impacts on the Valley's already poor air, which is what worries opponents.

Grave said he'd like to see Wal-Mart only use its hybrid big rigs in Merced and also force its third-party contractors to use cleaner diesel trucks.

MARG has been accused of being a front for special interests outside the community. Grave said that's not the case. The attorney, he said, is working pro bono. He may be able to recoup his fees if the group prevails in court.

Grave said MARG's membership includes Merced Associated Democrats, the Merced/Mariposa Teachers UniServ Council, the Sierra Club and the Merced-Mariposa Central Labor Council.

Wal-Mart's spokesman was unavailable for comment, though the company has expected that the project would be challenged in court.

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Booksellers Seek Probe on ‘Predatory’ Amazon.com, Target Prices

By Christopher Stern
and Cotten Timberlake,
Bloomberg
October 23rd, 2009                          [back to top]  

The American Booksellers Association asked the Justice Department’s antitrust division to investigate “predatory” pricing of books sold by Amazon.com Inc., Wal-Mart Stores Inc. and Target Corp.

“We ask that the Department of Justice investigate practices by Amazon.com, Walmart and Target that we believe constitute illegal predatory pricing that is damaging to the book industry and harmful to consumers,” nine ABA board members wrote in a letter addressed to Christine Varney, the assistant attorney general for the antitrust division.

The letter, dated Oct. 22, was posted on the Web site of the group, which represents independently owned U.S. bookstores.

Earlier this month, Target, Walmart, and Amazon.com all said they would sell bestsellers by John Grisham and Stephen King for about $9. These books typically retail for between $25 and $35, the association said. King’s “Under the Dome” costs a retailer at least $17.50, the group said.

Meg Smith, a spokeswoman for the American Booksellers Association, referred reporters to the letter on the Web site.

“We are committed to providing our customers with the best possible prices, and that is what we are doing here,” Daphne Davis Moore, a spokeswoman for Bentonville, Arkansas-based Walmart, said in an e-mail. “We always work to follow applicable law.”

Drew Herdener, an Amazon.com spokesman, didn’t immediately respond to a request for comment. Kelly Basgen, a spokeswoman for Minneapolis-based Target, had no immediate comment. Justice Department spokeswoman Gina Talamona declined to comment.

‘Going Rogue’

Walmart dropped 15 cents to $50.48 yesterday in New York Stock Exchange composite trading. Target advanced 59 cents to $49.49. Seattle-based Amazon.com added 3 cents to $93.45 on the Nasdaq Stock Market.

Amazon.com cut the price of top-selling books including Sarah Palin’s “Going Rogue: An American Life” to $9 on Oct. 16, matching an online price reduction by Wal-Mart the day before. Target said Oct. 19 it would make similar cuts.

Amazon.com, the world’s largest Internet retailer, and Walmart, the world’s biggest retailer, are vying for sales of hardcover books scheduled for release in November. Walmart also offered free shipping and price cuts of 50 percent or more on 200 bestsellers, including Dan Brown’s “The Lost Symbol.”

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Plans for Cinnaminson Wal-Mart Supercenter hit snag

By JANE ROH,
COURIER-POST
October 22nd, 2009                     [back to top]  

Plans for an expanded Wal-Mart in Cinnaminson were halted by a court on this week.

Judge Ronald E. Bookbinder of the Burlington Vicinage found in favor of the plaintiffs, who opposed the retail giant's plan to expand the Wal-Mart at the Marketplace complex off Route 130 into a larger Wal-Mart Supercenter.

Wal-Mart applied last year to demolish and reconstruct additions that would allow the store to accommodate a grocery section.

The Cinnaminson Township Planning Board voted to approve the request last March, but a group of plaintiffs that included Karl W. Eickhoff, objected. Eickhoff owns several ShopRites in the region, including one at the nearby Shoppes at Cinnaminson.

Of the several complaints filed, the judge found only that Wal-Mart failed to properly notify the public about Planning Board meetings.

"The judge's decision was ultimately premised on the faulty notice objection," said Jeffrey Brennan, an attorney representing the residents. "As far as successive meetings, if proper notice hasn't been given, the board doesn't have jurisdiction to consider the application so everything gets dropped and has to start anew."

Despite the setback, Wal-Mart is likely to eventually get the green light for its expansion plans, said Mark Roselli, attorney for the Cinnaminson Planning Board. Judge Bookbinder indicated in a tentative judgment that none of the other complaints lodged by the plaintiffs had merit.

The decision will be final within one to two weeks, Brennan said.

Also on Wednesday, Judge Francis J. Orlando, Jr. of the Camden County Vicinage invalidated plans for a 100-room hotel and banquet center across the street from the future campus of Virtua Hospital's new Voorhees campus.

The judge found that approval for the hotel - to be built by a group of private investors - violated an ordinance that prohibits hotels on that side of Route 73. The suit was brought by Riddhi Siddhi Associates, which owns several hotels in the area including the Wingate Inn on Laurel Oak Road.

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Walmart & eBay Agree:This Christmas Will Suck

By Vincent Fernando,
The Business Insider
October 22nd, 2009              [back to top]  

We're not seeing good noise on the Christmas front lately.

A gloomier than expected outlook hit Walmart (WMT) hard yesterday afternoon while eBay (EBAY) is curerntly down in the premarket after reporting.

Bloomberg: Walmart plans to reduce prices as the season advances in areas including home, food and gifts, Fleming told analysts today at a conference in Rogers, Arkansas.

Consumers’ wallets “are challenged,” Fleming said. The holiday season “is going to be tough, it is going to be late.”

eBay reported sales growth, but may have disappointed investors with a less than confident outlook for the holiday season.

Reuters: "The economy we see stable, and we're cautiously optimistic about consumer spending going into the holiday," said Chief Executive John Donahoe. "What is more important from our standpoint is we actually see some progress on our turnaround metrics."

It will be interesting to see what kind of outlook Amazon (AMZN) provides later today.

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Wal-Mart postpones plastic bag test at two local stores

By Jim Downing ,
The Sacramento Bee
October 22nd, 2009         [back to top]  

Wal-Mart Stores Inc. on Wednesday said it will not be removing free plastic bags from two of its locations in the region until at least January.

Signs in Walmart stores in Folsom and Citrus Heights had announced that shoppers would soon have to either bring their own bags or buy reusable ones – for 15 cents.

The two stores, along with a third in Ukiah, make up a small test program. Going plastic bag-free is one of a variety of strategies being tried at stores around the world as Walmart evaluates ways to meet its goal of cutting plastic bag waste 33 percent by 2013.

Wal-Mart spokeswoman Amelia Neufeld said the company decided that launching the reusable bag-only program just before the holiday shopping season would skew the test results. "The goal of this test is to gauge customer reaction. We think we'll get a more accurate reaction by offering these bags after the holidays," she said.

Neufeld would not comment on whether recent customer reactions had driven the decision to postpone the test.

At the Folsom store earlier this week, customers interviewed by The Bee were roughly split on the plan.

Matthew Oliver, a Folsom resident who complained in writing at his local store after learning of the plan, said a Wal-Mart representative called him Wednesday to say the Sunday launch of the test program had been called off.

Oliver said he resented the reusable bag program because he felt it was a cost-cutting measure with a green veneer that deprived him of the right to choose how he'd like to carry his purchases.

"I just want to buy my milk from you," he said. "I don't want you to tell me what my political views ought to be."

Wal-Mart is also evaluating other strategies for reducing plastic waste that don't involve removing free plastic bags from stores altogether. It is retraining some checkers to put more items in each sack, for instance, and is considering switching to thinner bags that contain less plastic.

The company's 15-cent reusable bags will continue to be offered at the checkout counters in Folsom and Citrus Heights, Neufeld said. They are royal blue and made of a lightweight, recyclable polypropylene fabric.

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Wal-Mart offers tech support for shoppers

By Michele Gershberg,
Reuters
October 22nd, 2009                 [back to top]  

Wal-Mart Stores Inc (WMT.N) is offering a new support service to help shoppers set up consumer electronics in their homes, posing a new challenge to rival Best Buy Co In (BBY.N).

Wal-Mart said it began rolling out the service this month with privately held N.E.W. Customer Service Companies Inc and is making it available through all of its U.S. Wal-Mart stores in time for the holiday season.

Shoppers can buy service plans on a prepaid card ranging from $99 to $339. The service spans help with basic television installation on the low end to setting up a home theater, wireless router network or a home office computer network.

The service includes a preliminary consultation and a tutorial after installation is completed.

Consumer electronics retailers have been offering technology support to differentiate their business and cut down on the number of products, particularly flat-panel TVs, that are returned after customers get the gadgets home but cannot use them properly.

Best Buy said last month it would hire more staff for the U.S. holidays and was betting that services like its Geek Squad repair assistance would give it a further edge over rivals.

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Walmart Begins Home Installation Program

By Alan Wolf,
TWICE
October 22nd, 2009                [back to top]  

Walmart has begun offering home installation services for TVs, home theaters and PCs through a partnership with NEW.

The services, which start at $99 for a basic TV installation and $129 for a basic PC setup, will be sold via prepaid cards displayed on descriptive merchandisers and within the home-theater and computer aisles.

The offering follows a major assortment and display upgrade within Walmart's CE departments, and represents a major step toward filling the service vacuum that separates full-line discount stores from specialty CE dealers.

The install program has already been introduced in some stores, and is expected to be rolled out nationwide by month's end, a Wal-Mart spokesperson told TWICE. "It's an affordable and simple solution, and a real benefit to our customers," the spokesperson said.

Unlike a similar NEW program that will debut at Wal-Mart's Sam's Club division on Nov. 1, the Walmart offering does not include home delivery.

The in-home visits will be made by NEW's nationwide network of about 11,000 certified and insured installers. Basic TV services include a pre-installation consultation, TV placement, hook-ups to two A/V components, remote control configuration, packaging clean-up, and a follow-up visit and tutorial.

Walmart's premium TV service, for $339, also provides wall mounting, concealed in-wall wiring and two additional A/V component hook-ups.

PC services range from $129 to $199 and include software installation, peripheral hook-ups, data transfer, hard-drive defragmentation and tutorials.

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Wal-Mart shrinks US supercenters, sees tepid sales

By Nicole Maestri ,
Reuters
October 22nd, 2009              [back to top]  

The Wal-Mart supercenter is getting downsized.

Wal-Mart Stores Inc (WMT.N) fueled its aggressive U.S. expansion this decade by opening supercenters that on average have more square footage than three American football fields. But at its analyst meeting on Thursday, Wal-Mart said it will rely on smaller, more efficient stores to drive future U.S. expansion and help it penetrate yet untapped urban markets.

While it shrinks the average size of its U.S. stores, its international operations are gaining in importance and will help fuel future sales. It forecast international square footage growth to outpace U.S. growth this fiscal year and next.

One area of business that Wal-Mart made clear it is not changing is its commitment to discount prices and its intention to defend its turf against rivals.

"We watch the competition," CEO Mike Duke said on the second day of its analyst meeting. "We will be the price leader."

On Wednesday, Wal-Mart outlined plans to slash prices every week until Christmas to fend off rivals and keep newly won market share gains. [ID:nN21501560] Online competitor Amazon.com Inc (AMZN.O) on Thursday forecast what could be a blow-out holiday quarter for its business, sending its shares up 13 percent. [ID:nN2238215]

Wal-Mart's price strategy pressured its shares as investors worried the discounts would hurt margins. Wal-Mart's treasurer, Charles Holley, said the retailer is being "thoughtful and strategic" about price cuts to protect margins.

But in response to analysts' questions about how Wal-Mart would respond if rivals slash prices, Duke responded multiple times that the retailer intends to be the "price leader."

TEPID SALES GROWTH SEEN THIS YEAR, THEN A REBOUND

Wal-Mart expects sales to grow 1 percent to 2 percent in the current fiscal year, below the 5 percent to 7 growth projection provided at last year's analyst meeting.

Chief Financial Officer Tom Schoewe attributed the shortfall to currency exchange rates and deflationary pressures. Last year, rising food and gas prices helped boost sales figures, but those forces have eased this year.

Higher growth should resume next year, when the company sees sales rising 4 percent to 6 percent.

It forecast square footage growth up 4 percent this fiscal year and next. For the current fiscal year ending Jan. 31, 2010, it will add approximately 38 million square feet globally, down from 44 million last year. In its next fiscal year, it expects to add approximately 37 million square feet.

Now that Wal-Mart is focused on improving returns instead of chasing U.S. expansion by opening mammoth supercenters, it is opening smaller supercenters that cost less to build and operate.

The average size of a supercenter, which combines a full grocery store with a discount store, has fallen from about 180,000 square feet three to five years ago to 150,000 or 160,000 in the past year or two, Schoewe said.

"Clearly ... that number will continue to come down," Schoewe told reporters on a conference call.

He also said Wal-Mart is trying to develop a smaller store format that could be used to enter urban markets where it does not yet have a presence.

"We are trying to figure out how to make the economics work," he said. "When you go into a major metropolitan area, real estate can be very expensive, so we have to find a way to balance that high cost of real estate and still provide everyday low prices to our customers."

Wal-Mart also expects capital expenditures of $12.5 billion to $13.1 billion in the current fiscal year, which ends in January 2010, and $13 billion to $15 billion for the next fiscal year.

Wal-Mart shares fell 15 cents to $50.48 on the New York Stock Exchange.

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Wal-Mart says cuts, slower growth to be positives

By ANNE D'INNOCENZIO,
Associated Press
October 22nd, 2009                          [back to top]  

Wal-Mart Stores Inc.'s CEO and President Mike Duke promised investors Thursday that the retailer's aggressive price-cutting will not hurt its stock price, even as the company issued a modest forecast for U.S. expansion this year and next. "We absolutely will have price leadership while at the same time greater shareholder value," said Mike Duke, who took the helm in February. "This is not about trading one for another. The two go hand and hand." He continued, "We will win in the area of retailing around the world." Duke was addressing investors on the second of two days of analyst meetings in Roger, Ark., near the company's headquarters in Bentonville, Ark. The meetings were broadcast online. The theme resonating from the meeting was how the world's largest retailer was cutting costs and reinvesting those savings to lower prices for shoppers, which in turn drives sales. The executives said that increased revenue will in turn increase efficiencies and lower costs further. Intent on keeping its reputation as a low-price leader, even as other chains cut prices to compete for steadfastly conservative shoppers, the retailer announced Wednesday that it will cut prices weekly on top-selling items from bananas to board games and hold those cuts through the holiday season. Company officials expect sales in the current fiscal year, which ends Jan. 31, to be 1 percent to 2 percent higher than last fiscal year. That's down from their original estimate of 5 percent to 7 percent. The following year, they expect sales to accelerate 4 percent to 6 percent as the company benefits from opening new stores and from easing deflation and more favorable currency exchanges. They declined to offer any guidance for sales at stores open at least a year, a figure that is considered a key barometer of a retailer's health. In August, Wal-Mart forecast the figure would show growth anywhere from 2 percent to flat for the current quarter. The company stopped reporting the figure monthly after releasing its April numbers. Wal-Mart, which generated more than $400 billion in sales last year, also narrowed its guidance for square-footage growth this year, to 4 percent, or 38 million square feet, from the original estimate of 4 percent to 5 percent. It expects its sales space to grow another 4 percent, or 37 million square feet, in fiscal 2011. Last year, the chain added 44 million square feet. Wal-Mart says it will spend $12.5 billion to $13.1 billion on capital projects this fiscal year, compared with $11.5 billion last year and $13 billion and $15 billion budgeted for next fiscal year. However, shares of Wal-Mart slipped 15 cents Thursday to close at $50.48, near the midpoint of their 52-week range from $46.25 to $59.23. Wal-Mart officials reiterated earlier statements about building smaller and fewer but more efficient stores in the U.S. In an interview with reporters Thursday evening following the meeting, Chief Financial Officer Tom Schoewe said new Wal-Mart's super centers, which carry food as well as general merchandise, were shrinking to 150,000 square feet, from a typical 195,000 square feet, and will get even smaller. The company plans to use the smaller format to further penetrate urban markets. But Wal-Mart's focus has been remodeling its U.S. namesake stores, a move that is accelerating because the effort is helping retain existing customers and attract new ones. Wal-Mart's Sam's Club chain is testing a new prototype that offers more everyday items like produce and health and beauty supplies while cutting back on most general merchandise like furniture, large appliances and DVDS. The categories Sam's Club is expanding have higher sales and gross profit returns per square foot than the overall average for Sam's Club, company officials said. Sam's Club CEO and president Brian Cornell said these changes will make stores less expensive to run. Internationally, however, Wal-Mart is stepping up its growth, particularly in emerging markets like China and Brazil. "We will allocate capital by country and by format, to improve returns from these investment," said Doug McMillon, president and CEO of Wal-Mart International. Wal-Mart plans to add 23 million square feet abroad this fiscal year and 25 million square feet the following, compared with 19 million square feet in fiscal 2009.

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Walmart to seek US urban growth

By Jonathan Birchall,
Financial Times
October 21st, 2009                 [back to top]  

Walmart said on Wednesday it is ready for a new US expansion drive in major cities using smaller and more efficient versions of its superstores, even as it continued to reduce its rate of annual square-footage growth in the US.

Mike Duke, chief executive, told the company’s annual autumn meeting with investors that the low-cost retailer’s “first priority is growth; Walmart continues to have aggressive growth plans” both internationally and in the US.

“We do have considerable opportunities to expand here in the US and especially in major metropolitan areas; and we will introduce new innovative formats here in the US,” he said.

Two years ago, Walmart began slowing the expansion of the large Supercenter format that has been the engine of its growth since the 1990s, as it faced an increasingly saturated market, with over 2,700 of the stores averaging around 187,000 sq ft.

The company said on Wednesday it expected to add just 11m sq ft to its US store base of almost 600m sq ft in fiscal year 2010, less than half the square footage it added annually at the peak of its US growth two years ago.

But while slowing growth, Walmart plans to keep US capital expenditure largely unchanged as it continues to remodel existing stores to increase sales and investment returns, while also developing a new, smaller “high-efficiency” operating model of its Supercenter.

Eduardo Castro-Wright, head of Walmart’s US stores, said the resulting increases in investment returns “will help us penetrate markets that have been traditionally difficult for us” because of higher real estate and labour costs.

“We do believe that we have now a model ... that will allow us to accelerate growth by driving this high-efficiency model to places and segments were we see opportunities for growth.”

Walmart has been frustrated in previous efforts to open stores in cities including Chicago, New York and Los Angeles because of political opposition in the planning process for the Supercenters orchestrated by its union foes.

Mr Castro-Wright also said Walmart now planned to build more of its 39,000 sq ft Supermercado de Walmart Hispanic-focused grocery stores, following the success of two initial stores that opened this summer in Arizona and Texas.

“We have now the model that will allow us to ... bring that format to places around America to places that will benefit from that product offering,” he said.

The average size of new Walmart stores opened in its next fiscal year will be around 8 per cent smaller than those opened in the current year.

“The writing is on the wall; we are going to smaller stores,” Mr Castro-Wright said.

He also argued that Walmart would be able to hold onto new customers acquired during the past year of the US recession, when it has outperformed most of its leading competitors.

Separately, Walmart said it was setting up global purchasing offices to handle its direct purchases of food, starting with fresh fruits and vegetables, on behalf of not only Walmart US but its stores in Canada and Latin America. Previously, it has largely bought for its stores through import agencies.

Mr Castro-Wright said the approach mirrored the model developed in the UK by its Asda subsidiary.

Pam Kohn, head of perishables purchasing, said an initial pilot involving apple purchases for had resulted in a 10 per cent reduction in the price of apples in its US stores.

Walmart also said it was amalgamating purchasing for its private label packaging, again on a multi-country basis, in a move to cut costs, and that an initial review of its supply base had already resulted in $150m of savings.

Walmart executives will outline their international and US store opening plans on Thursday.

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Wal-Mart fires employee for chasing after thief

By Jackie Alexander,
Ocala.com
October 21st, 2009                     [back to top]   

Josh Rutner said he was just doing his job as a Wal-Mart "asset protection officer" earlier this month when he chased a knife-wielding theft suspect across the store parking lot.

The man, later identified as Marc Ash, was arrested by Ocala police and the merchandise was recovered.

The next day, Wal-Mart fired Rutner.

Rutner said it boiled down to doing what was right or following policy. For him, it was an easy choice.

"I couldn't let him get away," Rutner said. "That's wrong."

But Michelle Bradford, a Wal-Mart Stores Inc. spokeswoman, said the store's no-chase policy is clear.

"We take the safety and security of our customers and associates very seriously," she said. "There are specific instructions as to what an associate can and can't do during a shoplifting episode."

According to Ocala police reports and Rutner's account, the trouble happened at the Wal-Mart on Southwest 19th Avenue Road near the Paddock Mall. Ash picked up a pack of golf balls, valued at $42.98, and put them in his pants.

Ash then took the golf balls to another section, left them, and ate deli chicken without paying, Rutner said.

Rutner said he watched Ash put the golf balls back in his pants and head out the front of the store.

After radioing for assistance, Rutner and two other employees tackled the man outside the food center doors.

Rutner worked for Wal-Mart for nearly four months, he said. He'd done plenty of stops before.

He wasn't expecting Ash to pull a knife, slash at his face and take off running, Rutner said.

"I felt now that he was a danger to the public and the city," he said. "If he'd pull a knife on two security guards, he'd pull a knife on anyone."

Rutner attempted to hit the man with a shopping cart, he said.

Customer Franchesca J. Marie told authorities she followed Ash into the parking lot from inside her car. She told him to stop and to put down the knife, which officials say she then picked up and threw in the middle of the road.

Police arrested Ash, who was charged with robbery with a deadly weapon and aggravated assault.

Rutner returned to work the next day.

"I was doing my normal routine," he said. "Nobody said anything."

Around lunch time, he was called into a manager's office. A corporate representative from Arkansas was waiting.

"They said this is a non-rehirable offense," he said. "At the age of 65, I can't even come back and become a greeter."

Bradford, the Wal-Mart spokeswoman, declined to comment on Rutner's potential for rehiring.

Rutner said he knew Wal-Mart policy prohibits employees from going after suspects armed with a weapon, but there was no time to think about the consequences.

Rutner turned in his keys, security codes and badge.

"I didn't get hurt. They got their merchandise," he said. "And yet I got fired."

Rutner said he was required to give a deposition Tuesday in Ash's court case.

Ash remains in the Marion County Jail in lieu of $57,000 bail.

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Ahead of the Bell: Wal-Mart

By ANNE D'INNOCENZIO,
Associated Press
October 21st, 2009                  [back to top]  

Some analysts expect Wal-Mart Stores Inc. may announce plans Wednesday at its analysts' meeting that it will accelerate U.S. store growth next year. Wall Street is also looking to hear details of more price-cutting strategies as it heads into the holiday season. Any move to increase store growth would come as the world's largest retailer has come a long way in improving store performance by paring down inventory, offering spruced-up merchandise and remodeling stores. Wal-Mart's share price soared 13 percent in 2008. However, the stock has slipped almost 6 percent so far this year, as investors focus on beaten-down shares of companies that sell more discretionary items like clothing and home furnishings. Shares slipped 19 cents to $51.70 Tuesday, below the middle of its 52-week range of $46.25 and $59.23. Wal-Mart's stock suffered from 2005 to late 2007 as its zigzag between upscale and discount goods slowed sales growth. "Wal-Mart has earned the right to grow, and it does not sound like it would result in meaningful capital expenditures growth as (year-to-year) square footage growth will likely be similar" to 2009, wrote David Binder, an analyst at Jeffries & Co. in a note published Tuesday. Binder added that maintaining the growth rate in space while increasing the number of stores it opens could be achieved by opening smaller supercenters. In the future, he believes that Wal-Mart can be much more flexible and open stores ranging from 99,000 to 175,000 square feet. That compares with its past focus on 195,000-square-foot sites. The company has said it's scaling back the size of its supercenters, which offer food as well as general merchandise. Binder noted that in recent conversations with management, Wal-Mart has even expressed some confidence in developing supercenters as small as 70,000 square feet. In fact, Wayne Hood, an analyst at BMO Capital Markets, wrote in a report Friday that he expects Wal-Mart to announce that it's narrowing its guidance for growth in square footage to 4 percent this year from the previous estimate of 4 percent to 5 percent. That compares with 5.9 percent last year. Wal-Mart spokesman John Simley declined to comment about any announcements the company will be making during the two-day analysts' meeting, to be held in Rogers, Ark., several miles from its headquarters in Bentonville, Ark. Analysts also are looking to hear about more details of Wal-Mart's aggressive pricing strategies as it heads into the holidays. Wal-Mart started a fierce price war on books on Thursday, announcing that its online site, Walmart.com, would charge just $10, with free shipping, for upcoming hardcover releases as Sarah Palin's "Going Rogue" and John Grisham's "Ford County." That's 60 percent or more off the regular cost. Amazon.com, the largest online book seller, then matched the prices. The fight became even more heated when the two competitors lowered the prices even further to $9 by Friday. Discount rival Target Corp. threw itself in the ring on Monday, announcing it was matching Walmart.com and Amazon.com prices for seven highly anticipated book titles for pre-ordering on its Web site. Also last week, Walmart.com started selling an array of personal care products. Last month, Wal-Mart announced that it was expanding its $10 holiday toy assortment to 100 items. "We don't believe management is saying with these initiatives that they are willing to lose money on them; rather, we believe they are saying that they can drive sufficient volume to be profitable," wrote Hood. Hood doesn't expect Wal-Mart to update its third-quarter earnings outlook of 78 cents to 82 cents per share or change its guidance for sales at stores opened at least a year. Wal-Mart expects that this metric — considered a key indicator of a retailer's health — should be in the range of flat to up 2 percent. Analysts surveyed by Thomson Reuters expect 81 cents per share in the third quarter.

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Union members plan demonstration today at the new Walmart in Raritan Township

By Terry Wright,
Hunterdon County Democrat
October 21st, 2009                                 [back to top]  

A demonstration is planned for today at the new Walmart here, with some 300 to 400 members of the United Food and Commercial Workers union Local 1262 expected to hold what it calls a “consumer education rally” outside the store. The local represents some 30,000 food service workers, mostly in supermarkets, in the northern half of New Jersey. The demonstrators gathered at a hotel in Woodbridge yesterday morning and would board seven or eight buses to come here, said Cyndi Spill, local communications director. The rally was planned “to make the public aware of Walmart business practices, as far as not providing health care to their employees” and paying low wages. She said that in the union’s view the health insurance takes a long time to quality for and its cost puts it “out of reach for most workers” at Walmart. Also, in the union’s opinion “they do not pay what we call a fair, living wage, something that you can raise your family on.” The rally was to “educate the public on Walmart’s impact on and cost to the local community,” she said. While the union internationally has an initiative to try to unionize Walmart, Spill said “we’re not as a local to try to organize this location.” Raritan Township police said they were aware of the demonstration.

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Wal-Mart announces weekly price cuts for holidays

Associated Press
October 21st, 2009             [back to top]  

Wal-Mart Stores Inc. is stepping up its game in price cutting. The world's largest retailer says it will cut prices for a week at a time on thousands of items, from bananas to board games, through the holiday season. The announcement comes as the discounter tells investors about its strategies at a two-day analysts' meeting that began Wednesday. The nationwide cuts start this week with bananas selling for 39 cents per pound; rolls of lean ground beef for $1.25 per pound and select board games for $15.

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Wal-Mart CEO says retailer can continue to win

By Nicole Maestri,
Reuters
October 21st, 2009                [back to top]  

Wal-Mart Stores Inc's (WMT.N) chief executive kicked off a two-day meeting by telling Wall Street that the world's largest retailer has more room to grow, both at home and internationally.

"I am competitive by nature and I want to win," CEO Mike Duke said in his opening remarks on Wednesday afternoon. "There is no doubt in my mind that Wal-Mart will continue to win in retailing all around the world."

Wal-Mart is meeting with analysts on Wednesday and Thursday. Its shares were up 2 cents to $51.72 soon after the meeting began.

Duke said the company's expenses should grow less than sales. He said that Wal-Mart will work to improve its expense structure by driving more productivity and efficiency.

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North Tonawanda Council member claims GOP leaders urged Walmart delays

By Aaron Besecker,
The Buffalo News
October 21st, 2009                 [back to top]  

Political opponents of Democrat Mayor Lawrence V. Soos wanted progress stalled on a proposed Walmart Supercenter in order to harm the mayor's chances for re-election, according to an outgoing Republican lawmaker.

"I was being asked to delay that process," said Alderman Brett M. Sommer, after he was asked if State Sen. George D. Maziarz, R-Newfane, and Niagara County Republican Committee Chairman Henry J. Wojtaszek had made that request of him.

Sommer would not name the individuals who asked him "to change [his] position on Walmart," or discuss other details of the conversation, though he did not deny involvement by Maziarz or Wojtaszek.

The accusations arose publicly for the first time when Common Council candidate Dennis J. Barberio questioned Sommer Tuesday night during the public comment portion of this week's council meeting.

Barberio, a former Republican who is running as a Democrat for an at-large spot on the council, asked Sommer if it was true what he heard him saying this past summer during a previous conversation.

Sommer declined to provide more details to The Buffalo News today, except to say that he took no steps to delay a project he supports.

"No matter what somebody told me," he said, "if I believe in something, I'm just going to plow ahead."

Earlier this month, the Common Council unanimously voted to give the final necessary approvals to allow a Walmart store to be built on the site of the former Melody Fair and Bluebird Bus garage, at Niagara Falls Boulevard and Erie Avenue. Its decision followed approval from the city Planning Commission in actions last month and this month.

Sommer, who stepped down as council president in late August and is not running for re-election, said he is not looking to hurt the campaigns of any Republican candidates through any statement he makes.

Soos -- a Democrat who has strongly supported the Walmart project from the time it was announced in the fall of 2006 -- is running against City Clerk-Treasurer Robert G. Ortt, the GOP candidate, in the Nov. 3 election.

"It's always been a feeling of mine that they've been trying to stall that project," Soos said today.

Wojtaszek told The Buffalo News such a conversation with Sommer never took place.

"Brett is bitter, I believe, because he's not going to be running as an endorsed candidate," Wojtaszek said.

Maziarz did not return a call for comment.

Sommer countered Wojtaszek's claim by saying he already had an uncertain future in politics -- his wife didn't want him to run for elected office four years ago, and he had been undecided on whether or not to run for re-election this time for about two years.

He said he's not bitter because he didn't want to run again; he was merely asked a question and he answered it. He also plans to vote for Ortt, and isn't supporting Soos in the election, he said.

"I should have known that some of these people are only your friends for political reasons," Sommer said today. "They act like your friends until they don't need you anymore."

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In Book-Pricing Battle, How Low Can They Go?

By MOTOKO RICH,
New York Times
October 20th, 2009                            [back to top]  

Call it a penny war.

Target, the discount retailer known for its low prices on dish detergent, home furnishings and Isaac Mizrahi clothes, has entered the battle to bring down the price of some of the holiday season’s biggest anticipated hardcover books to the lowest possible level. And Wal-Mart, which started it all and has vowed to maintain the lowest prices, immediately fired back.

On Monday Target began offering customers who ordered any of six soon-to-be published books on its Web site the same $8.99 price that Wal-Mart has been offering since Friday for 10 titles on its Web site.

Wal-Mart.com had originally offered the books for $10, then dropped to $9 on Friday after Amazon.com had matched its $10 price. When Amazon also went to $9, Wal-Mart cut its price by just a penny. And sure enough, when Target.com, the newcomer to the price war, matched that $8.99 on six of the books, Wal-Mart responded on Tuesday by dropping its price on those books to $8.98.

Target says it soon will include the four remaining books on its discount list, as well.

The books include Sarah Palin’s “Going Rogue”; “Under the Dome” by Stephen King; “I, Alex Cross” by James Patterson; “Pirate Latitudes” by Michael Crichton; “The Lacuna” by Barbara Kingsolver; and “Ford County,” a short-story collection by John Grisham. Amazon had not cut any pennies as of Tuesday afternoon and was sticking with $9.

It’s a contest “that has no end in sight,” said Michael Norris, an analyst with Simba Information, which provides research and advice to publishers. Mr. Norris said the price war could be particularly damaging to booksellers because they could not afford to discount that heavily, while the retailers who were slashing prices “don’t need to sell books in order to stay in business” and therefore can sell the books at a loss.

“Obviously, authors don’t own our physical books, just the words inside, so we have no control over how they’re sold,” Ms. Kingsolver said. “But we can ask our readers to consider how much they value their local bookstores. If this price war is another way of using volume discounts to put independent booksellers out of business, then every thoughtful reader is going to lose in the long run.”

Publishers typically sell hardcover books to retailers at half the list price, while retailers set consumer prices. Most of the books discounted by Wal-Mart, Target and Amazon are listed at a minimum of $24. Mr. King’s novel has a list price of $35. At $8.99 or $8.98, that is about 75 percent off the list price.

When the price war began last week, Mr. King said he was “gobsmacked” by this turn of events, comparing it to gas stations in the 1970s that tried to undercut one another penny by penny.

“I don’t think it’s a good thing for books to be perceived to be low-value items,” said David Young, chief executive of Hachette Book Group, Mr. Patterson’s publisher. “A hell of a lot goes into the creation of a book or a career of a writer, and to have our top products savagely discounted is not good for the long-term health of our business.”

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Walmart’s Passage to India

By Malini Goyal ,
Indrajit Gupta,
Neelima Mahajan-Bansal,
Forbes India
October 20th, 2009                          [back to top]  

Before we begin to tell this story, allow us a moment to put a few things into perspective. Walmart is the world’s second largest company after ExxonMobil. Last year, it was number one. Now, pause for a moment and ask yourself how large is large really? Large is when your revenues are in the region of $406 billion and you are six times larger than Proctor & Gamble, the largest consumer products company in the world. Large is when those revenues are more than the GDP of at least 144 nations.

Large is when you need at least $8 billion in additional revenues to grow by two percent each year. When a system is built on the back of this kind of numbers, the people running it are difficult to please and equally difficult to impress. But one July morning this year, Doug McMillon, was mighty pleased and mighty impressed. The CEO of Walmart’s international operation was visiting his newest baby — a large, month-old store on the fabled Grand Trunk Road just outside Amritsar in Punjab.

Set up in a joint venture with Sunil Mittal’s Bharti Group and called Best Price Modern Wholesale, bean counters at the store told him they had signed on close to 35,000 members in the first couple of weeks (which has since ballooned to 70,000). They included small kirana shop owners, hotels, restaurants, schools, colleges, the police force and even the Indian Army. Sales, they told him, exceeded expectations by almost 70 percent. And that the profits being generated were large enough to cover even depreciation. Their only concern was whether stocks could cope with demand.

McMillon blinked. After 18 years at Walmart, he knew the company is pretty damn good — actually, the best — when it comes to retailing. But it had never attempted a pure wholesale format anywhere in the world, including in the US. If anything, it has only played with hybrid models like Sam’s Club that caters to both bulk buyers and retail shoppers. The closest it had come to making a format like this work was something called Maxi in Mexico. But that wasn’t a pure business-to-business model. Even homemakers could shop there.

For the first time, McMillon figured, Walmart was looking at a model that held out a few promises. One, if scaled up, it could easily feed a billion dollars into Walmart’s insatiable appetite over the next five years. Two, if the model be replicated in other emerging markets across the world, God alone knows how many billion dollars the company could walk away with.

Shortly after he concluded his visit to the store, an effusive McMillon told CNBC-TV18, “Our investments in India are really not constrained from a financial perspective. The constraint is more about how many cash and carry units can you get to open from a real estate perspective.”

What he really meant was that Walmart is ready with a $5 billion plus war chest for its international business and it is up to India to use as much of it as it can. And that if the Indian team, headed by former Unilever executive Raj Jain, can find enough land to set up more stores of the kind operating in Amritsar, he can double the stakes. “We will roll it out rapidly,” says Jain. The plan is to set up 15 — maybe more — of such stores across the country in the next two years.

Serendipity Sure, there is a school of thought that argues Walmart is among the last of its kind to latch on to the great Indian dream. Home-grown businesses like the Future Group have more than a decade’s head start. Others like Reliance and A.V. Birla have learnt from their mistakes and are now looking to regroup their strategies.

But honestly, that is missing the trees for the woods. All of them cater to a $20 billion organised retail opportunity. The cash and carry opportunity is a much larger, $400 billion opportunity, now dominated by the unorganised wholesalers who supply to local kirana stores. The only one who tried was Germany’s Metro — the world’s largest wholesale operation. But it never quite figured India out. It isn’t that Walmart was clueless of the India opportunity. After China, this is the only country where it sees enough potential to plant at least 1,000 stores. But there are regulatory issues. Indian law prevents foreign retailers from selling directly to consumers. If they intend to take the wholesale route though, they’re welcome to open shop. But Walmart had a lot of thinking to do before it took the plunge.

Two decades after stepping out of the US, it remains a quintessential American company. It understands American consumers well, but is ill at ease in most emerging markets. Professor Anil Gupta, who has tracked Walmart’s progress around the world teaches strategy at the University of Michigan says, “I spoke with senior executives from Walmart a couple of years ago wanting to find out how global the company’s mindset is. I had an instrument to do this. They said don’t give it to us. Our global mindset is below zero — we are a US company doing business abroad and not a global company.”

But under its current CEO Mike Duke, Walmart has made big strides outside the US. In 2007, more than 50 percent of Walmart’s assets were outside the US. “Walmart’s future is clearly outside the United States,” says Gupta.

And finally, its experience in other parts of the world was patchy. In Mexico, when it started out in 1991, it set up a huge American style parking lot outside its discount store. Until its managers realised customers came in buses, not cars. And that there are no takers for golf balls in a low-income country. In time though, they recovered and are now very successful there.

There were hiccups in Brazil as well where they had to deal with tough competitors like Ahold and Carrefour. Eventually, Walmart bought out Ahold. In Argentina, it operates on the fringes with barely 4 percent market share. Its push into Central America — Costa Rica, Guatemala, Honduras and Nicaragua — came through an acquisition in 2007. But these markets are too small to matter in the larger perspective. In Germany, Walmart couldn’t match up to entrenched players like Metro and Aldi. It finally took a billion-dollar hit, sold to Metro and got out.

Its first foray into Asia was in Hong Kong. But it was unlucky with the partner. Eventually, Walmart pulled out. Next stop: Indonesia during Suharto’s time. To do business there, there was no way out but to tap into his network. A little later, riots broke out, Suharto was deposed, and Walmart’s stores were burnt down. The foray into South Korea was doomed from the beginning. Seven years after trying to gain scale, it sold its businesses there and abandoned the hunt.

Walmart cut its teeth in China during 1997. Some cardinal mistakes later, like attempting to sell frozen foods to a nation obsessed with fresh vegetables, meat and fish, it has managed to hang on in there. More than 10 years down the line, it lags French retail chain Carrefour which, unlike Walmart, gives greater autonomy to local store managers.

To be fair to Walmart, it learnt its lessons well. “Our model revolves around scale … and offering good quality products at prices lower than others,” says Raj Jain. “If we can’t have that scale for whatever reasons, legal, financial, or anything else, by and large we don’t succeed in those markets. So let’s be clear about this: If we enter India we have a vision to be big.”

Which is why when faced with two options, wait for the law of the land to change before setting up shop or punt on the wholesale opportunity, it chose the latter. And in spite of having the option to come in on its own, Walmart chose to partner with Bharti Enterprises for the cash and carry wholesale business. It wasn’t willing to repeat mistakes made in other parts of the world because they couldn’t figure out local nuances early enough.

It helped. As Sunil Mittal told Forbes India a few weeks ago, “I went to Amritsar and they showed me some stores. I thought there was too much breakfast cereal stacked there. I told them, it’s the wrong thing in the wrong place. These are things you learn when you’re in a country. It isn’t a fight.”

Bharti gained significantly as well from the relationship. The technology to built Bharti’s network of retail stores, Easyday, is licensed from Walmart. The back end logistics of the operation is also managed by the giant from Bentonville. Vinod Sawhney, president, Bharti Retail, says even when it comes to little things like how best to communicate the best prices available to customers, the relationship with Walmart comes in handy. They promptly dispatched Easyday’s managers to China to figure out how price-offs are best communicated inside the store.

Incredible India Among the first things Walmart did was to pick a bunch of seasoned managers who understood India well. Leading the pack was Raj Jain, who had been a senior executive at Unilever in India before he moved to Whirlpool where he eventually rose to head its Asia operations.

It also brought in expats who knew the Walmart system well. Craig Wimsatt was designated chief operating officer (he is now relocating back to headquarters on a new assignment). With him was Arvind Mediratta, a seasoned Procter and Gamble executive who had his pulse on the Indian market. Mediratta was the business head for the wholesale cash and carry business.

When Wimsatt and Mediratta rolled their sleeves and got down to business, they first tried to understand why their German rival Metro didn’t do well. It didn’t take them long to figure out why the business wasn’t working.

Their store design for instance. Metro spent a huge sum of money on buildings with roofs that can withstand six inches of snow in Bangalore — a city that hasn’t seen snow ever. Store sizes for Metro were far bigger (upwards of 80,000 sq ft), more in line with the German wholesale club format it was based on. Its expat managers refused to stock products like that uniquely Indian creation, a jharoo (broom), because it didn’t fit into how the company defined products back home. It is another matter altogether that they’ve mended their ways since. But the damage was done.

Then there was the whole thing around the cash and carry model itself. The Walmart team argued it was flawed because Metro’s product mix had been a cross between what a wholesale store ought to stock and what a retail store must. For instance, customers could find a wide assortment including items like ladies suits and footwear. “These are retail items,” says Mediratta. “Often these items lead to unsold inventory. You need to have a good and right assortment at the right price.” They concluded that Metro’s cost of operations were simply too high and the merchandise was not in sync with the target market.

With this in mind, Walmart started looking closely at how things work in India. This lesson learnt, the pros focused their attention on small kirana stores: Where do they buy from? What do they buy and how? They repeated this exercise across all the segments they intended to target. “Best prices, reliability in terms of availability and quality was one thing all of them demanded,” says Mediratta. When it comes to fast moving branded products, quality was not an issue. In any case, that is what traditional wholesalers in India have focussed on and worked off very thin operating margins in the region of 1 to 1.5 percent.

But when it comes to groceries, rice, pulses and meat — it was a huge problem. Restaurant owners, for instance, told them their customers are used to a certain kind of paneer (cottage cheese) or fish. So they stuck to the same supplier to ensure consistency. Mediratta recalls a caterer telling him of the time he attempted to change his fish supplier. The next day, customers complained the taste wasn’t quite the same. That’s when they figured there is a supply chain at work here. Not the most efficient perhaps, but it works, somehow. To that extent, the people Walmart intended to target were dealing with as many as 100 suppliers each. Not just that, the market was hopelessly price sensitive. Fundamentally a one-stop shop could make life easier for these folks. But delivering on the proposition of lower prices and better quality was the tough part. Most suppliers had to agree to new terms of trade. Since Metro bombed in its early years, most people doubted Walmart’s potential to create a winning proposition.

But the team did their homework well. They figured, for instance, that the arbitrage available from the time a farmer grows something to the time the retailer sells it is Rs. 2 per kg. Conventional wisdom in the business claims organised retail usually works when the supply chain is owned by the retailer. “If you want to make everything work at Rs. 2 per kilo, it would suicidal to invest in a mega supply chain,” says Raj Jain.

To get around the problem, Walmart focussed on sourcing smartly from farmers, small mandis that others hadn’t looked at yet, and the larger ones as well for the retail stores. That done, it is sent to an aggregation centre, sorted out, graded and supplied to the store twice a day. For the cash and carry model, however, to keep costs even lower, Walmart chose not to route supplies through distribution centres, but take delivery directly at the store.

“It is an interim solution, but a practical one,” explains Jain. “I think people failed in India because they went from almost nothing to very sophisticated systems. The cost of infrastructure they developed is so huge that it is not possible to sustain it on a margin of Rs. 2,” he argues.

That is why it took nearly two years to convince suppliers that the new team at Walmart had answers. It meant intensively working with the local suppliers on a range of private labels. Suppliers like Astra Agro’s Jaspreet Singh Bakshi, who has an eight-year-old pickle unit in Mohali, Chandigarh. Walmart insisted everything in his store be labelled, the machines calibrated every quarter and weights meet certain standards. “The main shift I think is in attitude,” says Bakshi. “Earlier, we weren’t used to keeping track of batches. Today, we do.”

That done, the team went on an aggressive customer acquisition programme, signing up close to 35,000 members (including add on members), even before the store was opened. The key accounts were getting parts of the Indian Army. That took nearly six months of effort and at least six to seven store tours before the Army units decided to buy from Walmart.

Simultaneously, the store planning was progressing well. A tight assortment of 5,500 stock keeping units (SKUs) was identified. Discipline was critical to the wholesale business. So, even if a single new item had to be added, there had to be a good reason as well. The focus was on depth of merchandise, so that if a customer wanted to place a large order, there was enough stock at the store to handle the sale.

In most Indian stores, the ability to quickly replenish items that had moved off the shelves was below par. This was referred to in industry parlance as fill rate. In Walmart’s book, a lot of the time, stores lost sales (and they didn’t even know it) because they were unable to quickly put back items that had been sold. Fill rates were traditionally in the region of 60-65 percent in most organised retail stores in the country. Walmart aimed for 90 percent.

Walmart brought in its best technology to improve the replenishment rate. By simply creating an Internet- based system which allowed suppliers to log in and track the purchase orders on a regular basis and supply as per the requirement.

But most importantly, Walmart being a past master in the art, focussed on paring costs down to the bone. For instance, finding large enough parcels of land is tough. But the India team took a call not to open stores unless rentals were pegged to a certain percentage of their total costs. That also meant settling for locations on the outskirts of the city they operate in. “We have skylights at the store so we don’t need to switch on lights during the day. Racking is simple. It is self-service, so you don’t have to deploy too many people to help members. Customers are even expected to pay for plastic bags,” says Mediratta.

That, perhaps explains why large institutional customers like MK Hotels, a leading hotel in Amritsar, which used to source supplies from the wholesale markets of Delhi have shifted loyalties to Best Price. Jasdev Singh, an assistant manager at the hotel, says the prices are about 5-10 percent cheaper. So, where does Best Price now head to? After Amritsar, company officials say their next stop will be another Tier II or Tier III town. Unlike Metro, which started off in Bangalore, it has no plans to launch the format in a metro town, where real estate prices are prohibitive and the wholesale system is well-developed.

The local team headed by Jain, Wimsatt and Mediratta had seen the potential of a cash and carry business early on. But now, inside Walmart, there is an equally strong conviction that across all its emerging markets, Best Price Modern Wholesale has a big future. And the best thing, says Mediratta, is that Walmart never forced a model on them. It was very supportive, despite the fact that they had never done a purely wholesale business before. Best Price is perhaps the best evidence that Walmart is quickly learning the rules of globalisation.

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Walmart to Open Clinic in Branson

Ozarks First
October 20th, 2009                       [back to top]  

The Branson Walmart Supercenter is the newest location of a CoxHealth Clinic.

It will be run much like the one that opened in Springfield.

The Branson clinic will be the fifth in-store clinic for CoxHealth inside a Walmart store in the Ozarks.

An office visit will run anywhere from $50 to $75.

The clinics serve people at least 18 months old who are sick enough to need care, but aren't sick enough to need the level of care available in an emergency room or urgent care.

A lot of people get their flu shots there. The Branson office will open November 2nd.

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Wal-Mart's on Sale, In the Options Market

By STEVEN M. SEARS,
Barron's
October 19th, 2009                   [back to top]  

ANECDOTAL EVIDENCE SUGGESTS the American consumer is back to spending money.

A Twitter correspondent who spent the weekend with his wife and daughter at Walt Disney's (DIS) Epcot Center tweeted that the place was packed.

Bloomingdale's in New York City was a mob scene on Sunday. Conversations with people all over the country reveal similar experiences. It seems that many people are no longer afraid to spend money, which may be a side-effect of the recovery of the stock market from the panic lows of March.

Concrete evidence into shopping trends should come Thursday when Wal-Mart (WMT) hosts its annual investor day. As the world's largest retailer, Wal-Mart's tone and presentation will play an important part in calibrating expectations for the all important holiday shopping that helps to set the tone on Wall Street. If Santa Claus should fail to call, the old saw goes, bears may come to Broad and Wall.

The good news is that the investment community is already enthusiastic about Wal-Mart's investor day. The stock has performed poorly this year, which increases pressure on Wal-Mart to use its meeting to persuade investors that it is moving aggressively to increase business. The recent decision to sell top-selling books for $10 could be a precursor of things to come.

Goldman Sachs told clients Monday to buy December $52.50 Wal-Mart calls for 88 cents, which will prove profitable should the stock gain just 1% through November 12 earnings.

The stock, which was really up about 1.2% at $51.87 is expected to move 5%, up or down, by November 20 when the options expire, according to Goldman's analysis of options prices.

Anyone who considers this speculation need not worry about paying too much for options. Wal-Mart's options volatility, the key element of an options price, is at a 10-year low for three-month options versus the Standard & Poor's 500 Index, Goldman's research found. This suggests that the options market has mispriced Wal-Mart's options, which offers investors a chance to take advantage of this possible error.

For investors who already own Wal-Mart stock, and are concerned about this year's poor stock performance, defensive put prices are similarly cheap, offering opportunities to cost effectively hedge the stock.

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The Wal-Mart Effect

By Michael Wilkerson,
Foreign Policy
October 19th, 2009                        [back to top]  

When India's first Wal-Mart opened this summer in Amritsar, the response was mixed, with detractors fearing that big-box stores would eventually crowd out India's fabled "wallah" culture. What no one remarked on, however, was that Wal-Mart's debut in a country is a bellwether for future growth. Indeed, Wal-Mart has started operations in 15 countries since 1991, and 13 of them have had boom economies, with an average of 4.4 percent annual growth since Wal-Mart arrived. Over the last five years, the economies of Wal-Mart countries outside the United States have grown 40 percent faster than the world average. So what's going on? Does the ability to buy giant bags of Froot Loops at cut-rate prices inspire economic growth? More likely, Wal-Mart is simply a smart, cautious investor. "Wal-Mart chooses to go places with a sizable middle class," says Nelson Lichtenstein, a historian who just published a book on Wal-Mart's rise. And Wal-Mart's attention to middle-class growth could pay off for the company in the future.

The portion of the global middle class that lives in the developing world should rise from 56 percent in 2000 to 93 percent in 2030, according to the World Bank. Next up for the Wal-Mart effect, Lichtenstein says: Russia and Eastern Europe. Picture the new global bourgeoisie outfitted with cheap hibachi grills, extra-durable puppy toys, and energy-efficient minifridges, and you've got a glimpse of the coming Wal-Mart revolution.

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Wal-Mart, Amazon Gear Up for Holiday Battle

By GEOFFREY A. FOWLER
And MIGUEL BUSTILLO,
Wall Street Journal
October 19th, 2009                        [back to top]  

For Wal-Mart Stores Inc. and Amazon.com Inc., the holiday shopping season is shaping up to be a battle between the Godzilla of retail and the King Kong of e-commerce.

The current price war over hot coming books is just the tip of the iceberg. In recent months, the two companies have increasingly copied each other's playbooks online and are treading more on each other's turf. Walmart.com Chief Executive Raul Vazquez said in an interview that Wal-Mart would continue targeting rivals such as Amazon with other hard discount promotions this holiday season. "We intend to establish the price leadership we have in stores in the online world," he said. He didn't elaborate.

Wal-Mart's Raul Vazquez at an Arkansas store last year. Shipping has become one of the battlegrounds between Amazon and Wal-Mart. An Amazon spokesman declined comment.

Signs of the battle between Amazon and Wal-Mart have grown over the last year, as Amazon extended its expansion into a general store by acquiring shoe and apparel retailer Zappos.com and adding private label electronic accessories like blank DVDs to its virtual shelves. Wal-Mart responded earlier this month by beginning to sell diapers and thousands of other health and beauty products online for home delivery. Amazon is also gearing up to begin television advertising for the first time in several years, according to a person familiar with the matter.

In the latest escalation, Wal-Mart announced last week it was cutting the price of 10 popular books online to $10. When Amazon quickly reciprocated, Wal-Mart dropped its price to $9. After Amazon copied that move too, Wal-Mart cut its price to $8.99.

Meanwhile, Wal-Mart took a page from Amazon's marketplace program in September by announcing it would start something similar, in which it would sell merchandise from other retailers on its Web site in exchange for a share of the revenue. Amazon's marketplace program has been crucial to its recent success at widening the scale of its business, and now accounts for nearly a third of sales.

And the two are also are duking it out on shipping, with Wal-Mart countering Amazon's free shipping programs by recently expanding its 97-cent shipping on many products. Wal-Mart says its online presence is important to driving sales in physical stores too. The company offers customers the ability to buy items online and have them delivered to a store near their home for free. It also allows customers to look online and see whether their local Wal-Mart store is stocking what they want.

"Physical stores continue to be incredibly convenient for people," Mr. Vazquez said. "That find in store function is used by millions of people every week."

Amazon struck back at that last week when it formally launched same-day delivery service in seven cities. Orders for same-day delivery have to be placed in the morning in most cases, but can be as late as 1 p.m. in Amazon's home town of Seattle. Over the last year, Amazon has also unveiled mobile-shopping apps, which allow customers to use their cellphones to compare its prices while in other stores, even letting them snap a photo of a product or its barcode to look up a product automatically.

Amazon has also won a legion of new customers with a $79-shipping program called "Amazon Prime" that offers automatic two-day shipping for many products. A PiperJaffray survey in May estimated that the program has attracted two million members, who increase their spending 20% after signing on.

And the battle for online supremacy is just beginning, as traditional store merchants take online sales more seriously. E-commerce currently makes up less than 5% of American retail spending, yet many in the industry believe it might become as much as 20% over time.

"E-commerce is a double-digit growth opportunity, not just now but for years to come," said Eric Best, CEO of Seattle-based Mercent, which helps brands sell their products through a variety of sites. "You ignore that at your peril if you're Wal-Mart."

Amazon is one of the few large U.S. retailers that managed to grow significantly over the last year, thanks to the cost-savings of not running physical stores. Analysts expect Amazon to post revenue gains of nearly 18% when it reports third-quarter earnings Thursday, according to Thomson Reuters.

For now, Wal-Mart is far behind Amazon online. Trade publication Internet Retailer estimates Walmart.com had $1.7 billion in online sales last year, while Amazon had $19 billion. Wal-Mart disputes Internet Retailer's figures because they don't account for merchandise that's bought online and picked up in stores, but declined to disclose details.

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Target jumps into book price-cutting fray

By Nicole Maestri
and Alexandria Sage,
Reuters
October 19th, 2009                   [back to top]  

Target Corp's (TGT.N: Quote, Profile, Research, Stock Buzz) online division said on Monday it cut the price of highly anticipated hardcover books to $8.99, responding to steep price cuts implemented last week by Amazon.com (AMZN.O: Quote, Profile, Research, Stock Buzz) and Walmart.com.

Target.com said it is offering the books, including "Breathless" by Dean Koontz and "Ford County" by John Grisham, for $8.99, including free shipping.

The price wars come two months before the holiday season, which analysts say will be characterized by big promotions. Retailers are hoping consumers associate their brands with value in a year in which unemployment is rising and consumer confidence remains weak.

Last Thursday, Walmart.com, the online division of Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research, Stock Buzz), cut prices on 10 yet-to-be-released hardcover books to $10 each, sparking a price war with Amazon.com.

After both online retailers then cut their prices on those books to $9 each, late on Friday Walmart.com shaved a penny off that price and was selling titles such as Sarah Palin's "Going Rogue: An American Life" for $8.99 each -- discounts of nearly 60 percent or more off the cover price.

Richard Hastings, a consumer strategist with Global Hunter Securities, said Target is typically careful about initiating a big price move, preferring to follow and match rivals, while eschewing splashy marketing campaigns.

"This is kind of typical of the way they'll play some of the price wars," he said.

The current competition is based on a select number of high-volume books backed by powerful publishers and is not a wider pricing war.

"It's about bigger volume and faster turnover, things where you have a lot of promotional support (from publishers). It's not a pervasive book war," Hastings said.

Still, prices could fall further. Walmart.com said last week it would adjust its pricing as needed to ensure it offered the lowest prices on its top 10 pre-selling books.

Target has been working to revive sales, which have taken a hit as shoppers hold off on buying its trendy clothes and jewelry during the downturn. The retailer has been emphasizing the "Pay Less" side of its "Expect More. Pay Less." tag line to draw customers into its stores.

It is also trying to erase the perception it says exists among shoppers that its prices are higher than those at larger rival Wal-Mart and it has also been touting its ability to match rivals' prices.

Earlier this month, after Wal-Mart said it would offer more than 100 toys, including Mattel Inc's (MAT.O: Quote, Profile, Research, Stock Buzz) Barbie dolls and some board games, for $10 each during the Christmas shopping season, Target fired back with price cuts of as much as 50 percent on toys like Barbie and G.I. Joe.

Neither Wal-Mart nor Amazon responded immediately to a request for comment.

Target shares closed at $50.39 on the New York Stock Exchange.

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What price, America? The high cost of 'cheap'

By Ellen Ruppel Shell,
Fredericsburg.com
October 18th, 2009                     [back to top]  

Last month, a bevy of Richmond residents joined with preservationists in filing a legal objection to the proposed construction of a Walmart Supercenter within firing range of the Wilderness battlefield. Roughly 30,000 American soldiers were injured or killed on that field 145 years ago, and while hopefully no blood will be spilled in the eventual outcome of the present skirmish, the stakes are still fairly high. On one side are the buffs, historians, concerned citizens, and celebrities who argue that the Civil War landmark is both sacrosanct and vulnerable. "The Walmart project would irrevocably harm the battlefield and seriously undermine the visitor's experience," declaimed Zann Nelson, president of Friends of the Wilderness Battlefield. On the other side are Walmart executives, who counter that far from besmirching hallowed ground, the intent is to boost the region with hundreds of jobs, hundreds of thousands of tax dollars, and an unbeatable shopping experience.

Neither side of this ongoing dispute is likely to see the world through the other's eyes. But a close look at the evidence makes clear that, historical significance aside, the addition of another 130,000 square feet of Walmart to a region already cluttered with the stores will bring significant collateral damage.

Walmart boasts of having the lowest possible prices on the widest possible selection of goods, thereby offering both convenience and value. But a few years ago Massachusetts Institute of Technology-trained economist Emek Basker decided it was time to examine that claim, and engaged in a study of Walmart stores located near 165 cities across the United States. What she found was that Walmart does indeed offer low prices, but not on everything it sells.

In fact, Basker found that Walmart prices were actually higher than average for the region on one-third of its stock. Equally interesting was that on those items for which prices were lower, the average savings was 37 cents, with about one-third of goods carrying a savings of no more than 2 cents.

RECESSION IS GOOD NEWS

Research for this study concluded prior to the ongoing recession, thanks to which Walmart--like most retailers--was forced to reduce its prices still further to keep the customers coming. It did so by aggregating the power of millions of individual consumers to gain leverage over its suppliers, the folks who actually manufacture and deliver the goods.

As the nation collapsed into its worst economic downturn in generations earlier this year, former Walmart CEO H. Lee Scott Jr. couldn't have been more pleased. "In my mind there is no doubt that this is Walmart time," he gloated. "This is the kind of environment that Sam Walton built this company for." When the nation is in pain, deep discounters like Walmart gain. They do not have to innovate to gain profit share; they simply squeeze their employees and suppliers a bit harder.

The power to wring cost out of bargain-basement goods is what makes Walmart so appealing to consumers, and the leverage to do so while maintaining record profits is what makes Walmart so appealing to company executives and investors. Naturally, these "everyday low prices" are not plucked out of thin air--they come at a substantial cost to most of us.

What might one day be called the "Wilderness Battlefield Walmart" will bring jobs, but not necessarily the sort of jobs our Civil War ancestors battled to protect. Walmart is fairly secretive about its pay scale, but what is clear is that most members of its rank-and-file work force do not make enough to build a solid middle-class life. Often these workers require supports in the form of subsidized health care and even food stamps, and the taxpayers foot the bill.

We've been asked to believe that low prices on T-shirts and toilet paper and hamburger compensate for these poverty-level wages, but we know in our hearts that they don't. Especially when so many of the cheap goods these "associates" stock and sell are manufactured or grown far away, in low-wage countries siphoning off jobs that once made possible the middle-class futures our ancestors sacrificed their lives to preserve.

WE'RE ALL PAYING

It's not just Walmart workers who are suffering under this system. For 90 percent of Americans, wages and benefits have been flat or declined for years: We may be able to afford those cheap T-shirts and toys, but it has become increasingly difficult to pay for the necessities--fuel, housing, health care, and a decent education for our kids. Low prices are made possible by low wages, job insecurity, and the loss of workers' rights up and down the supply chain. With the unemployment rate hovering at 10 percent, can we really afford to continue on this path?

Civil War battlefields deserve our respect. And so do the memories of the soldiers who fought on them. One of the more famous of those soldiers was William McKinley, who later became the nation's 25th president. It's impossible to know for sure what President McKinley would have said about the Wilderness battlefield, but we can garner some clues from the historical record. "I do not prize the word 'cheap,' he once said. "It is not a badge of honor. Cheap merchandise means cheap men."

More than a century later, his words ring truer than ever.

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Wal-Mart Strafes Amazon in Book War

By MIGUEL BUSTILLO and
JEFFREY A. TRACHTENBERG,
Wall Street Journal
October 16th, 2009                             [back to top] 

Wal-Mart Stores Inc. launched a brash price war against Amazon.com Inc. on Thursday, saying it would sell 10 hotly anticipated new books for just $10 apiece through its online site, Walmart.com.

That was just the beginning.

Hours later, Amazon matched the $10 price, squaring off in a battle for low-price and e-commerce leadership heading into the crucial holiday shopping season. Wal-Mart soon fired back with a promise to drop its prices to $9 by Friday morning -- and made good on that vow by early evening Thursday.

Wal-Mart said the splashy move to discount pre-orders of popular books such as Stephen King's "Under the Dome" and Sarah Palin's "Going Rogue" was part of a larger strategy to establish Walmart.com as the biggest and cheapest online retailer.

"If there is going to be a 'Wal-Mart of the Web,' it is going to be Walmart.com," said Walmart.com CEO Raul Vazquez in an interview. "Our goal is to be the biggest and most visited retail Web site."

Wal-Mart's $10 promotion applies to the top 10 books coming out in November but the company is also selling 200 best-sellers for 50% of their list price.

The price war sent shivers through the publishing world. Wal-Mart's move, and similarly low prices for electronic books, may ultimately condition consumers to expect new titles to cost $10, a price that would force the publishing industry to re-scale its entire business, including the advances paid to writers.

"The endgame is rather scary for authors," said one book executive.

Some big authors, however, are looking on the bright side. Dean Koontz, whose soon-to-be released novel "Breathless" is being discounted to $10 from $28, said that he thinks the discounting may prove a good thing for the authors involved.

"Any time people are fighting over your work it's a good thing, especially when you've worked all those years hoping it would be fought over," he said. "I don't think this is going to be a long-term thing. Rather, it sounds like a promotional strategy designed to call attention to Wal-Mart's decision to enter the digital marketplace more heartily than in the past."

Mr. Koontz said that Crown Books Corp., a now-defunct book chain that grew to 170 stores in only seven years after launching in 1977, paved the way for book discounting. "They're no longer with us, and perhaps that tells us something, but after they started to discount books hardcover sales simply exploded."

Mr. Koontz said he's more worried about the independent bookstores. Although most limit their stock of best-sellers, a price war on the most popular books may hurt.

James Patterson, whose coming novel, "I, Alex Cross," is being discounted from $27.99 to $10, said he was happy to be in Wal-Mart's top 10. However, he warned any industry that sets low price points may later have a difficult time re-establishing those prices. "Obviously e-books have gotten this thing going," said Mr. Patterson. "E-books are terrific and here to stay. But I think that people need to think through the repercussions....But I'm not taking sides....I'm not the endangered species here."

Wal-Mart said it wasn't trying to match the price of electronic books. Still, the $10 price tag coincides with the $9.99 that Amazon.com charges for its Kindle e-reader best-sellers.

Wal-Mart declined to discuss whether it was losing money on the $10 book promotion, which includes free shipping. But the answer is almost certainly yes.

Retailers traditionally pay half the list price for a hardcover book. Assuming that's the case with Wal-Mart, its $10 sale price on "Under the Dome" represents a 71% discount of the $35 cover price, which suggests the discounter will lose $7 to $7.50 on every copy it sells.

"Ten dollars for a hardcover book is a slashing of margins to the bone," said Richard Curtis, a New York literary agent and e-book publisher.

Diana Abbott, manager of the Bookworm, an independent bookstore in Omaha, Neb., said that some independents will likely lose some business on the titles involved. "We've been fighting deep discounting for a long time, although $10 is obviously an extreme," said Ms. Abbott. "But there is a strong element of loyalty to independents....We'll survive this."

Wal-Mart is far and away the planet's largest mass merchant with annual sales topping $400 billion. It doesn't release its on-line sales, but analysts say they trail those of Amazon, which notched $19.2 billion in sales last fiscal year, a 29% increase.

An Amazon spokesman, in a statement, said the company's approach "has always been to offer customers low prices every day, which includes the holiday shopping season."

Amazon has managed to encroach on Wal-Mart's general-store status online by steadily increasing the range of products it sells. While it is best known for selling books and music, Amazon's second-quarter North American sales of "general merchandise" -- including everything from diapers to vacuums -- were for the first time larger than its sales of media. It recently acquired shoe and apparel seller Zappos.com. And taking another cue from Wal-Mart, Amazon has steadily increased its range of private-label goods.

Meanwhile, Amazon on Thursday formally launched a local express-delivery program that offers same-day shipping to customers in seven cities, including New York, Boston and Washington, D.C.

In its effort to step up its Web presence, Wal-Mart is now selling merchandise from lesser-known retailers on its Web site in exchange for a share of the revenue, a business model crucial to Amazon's success. It also is expanding its online assortment of health and beauty products.

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Wal-Mart's Painful Lessons

by Matthew Boyle
Business Week
Thursday, October 15, 2009                  [back to top] 

Having grown in fits and starts, Wal-Mart's international unit has a new game plan. Can it master world markets?

It's rare that a $100 billion business can be marginalized, but such is the case with the international arm of Wal-Mart Stores (WMT). As a stand-alone company, it would rank among the top five global retailers. Inside the $401 billion retail giant, though, the business has traditionally received short shrift. Its Bentonville (Ark.) headquarters is underwhelming—a drab, largely windowless, one-story structure named after Bill Mitchell, a former Walmart executive whom nobody seems to remember.

Since venturing into Mexico in 1991, Walmart International has grown haphazardly. During the 1990s the retailer exported its big-box, low-price model. While that strategy worked in North America, the results were so bad in Germany and Korea that Walmart withdrew from those countries in 2006. In response, Michael T. Duke, the former international chief and current CEO, gave local managers more autonomy while instituting more stringent financial goals for each region.

The results are mixed: International sales rose 11.5% in the second quarter (before the impact of exchange rate fluctuations), while U.S. sales barely budged. But over the past few years, operating profit margins have declined on the international side, which now has 3,805 stores operating under 53 distinct banners in 15 markets. As international chief C. Douglas McMillon says, Walmart is "progressing from being a domestic company with an international division to being a global company."

A Tale of Four Countries

The trick is how to get there. Four countries illustrate the challenges the world's largest retailer will face in the coming years as it seeks new sources of global growth. In Japan, managers are trying to revitalize a business that has hemorrhaged money for years—weighed down by a ho-hum brand, the country's byzantine distribution system, and cultural resistance to the discount model. In India, restrictions on foreign ownership have forced the company to team up with conglomerate Bharti, an odd coupling that has so far resulted in one store. Walmart has spent more than five years in Russia, maintaining a team of 30 executives who are still trying to plot an entry strategy at a time when other foreign retailers, like Carrefour, are bulking up their presence. And in Chile, a decade-long courtship finally led to the acquisition of the country's leading supermarket chain earlier this year, bringing with it a different business model, based in part on financial services.

All four demonstrate the perilous but potentially lucrative terrain that lies outside the saturated retail markets of Europe and North America. And Walmart's success will ultimately hinge on its ability to learn from past mistakes and adapt quickly to the shifting realities of these markets. Ahead, a look at the company's strategies.

Japan

It's lunchtime at a newly remodeled Seiyu supermarket in Tokyo, and shoppers are swarming around bento boxes that sell for 289 yen, or about $3. In the back, peaches, bananas, and pears are stacked neatly in the bins they were shipped in while the front of the store houses bottles of Chianti and Burgundy from Asda, Walmart's British chain. Nami Misawa, 26, is looking through near-empty discount bins. The recession prompted her to come back to Seiyu, and she's glad she did. "This store used to be a mess," she says, "but now it looks great."

Misawa's newfound enthusiasm is welcome news for Walmart, which has taken a beating in Japan. It entered the country seven years ago with the purchase of a 6% stake in the 371-store Seiyu chain. Despite continued losses, Walmart gradually raised its stake, making Seiyu a wholly-owned subsidiary in June 2008.

Walmart has had to confront numerous issues in Japan, from longtime Seiyu managers resisting its initiatives to a tendency among Japanese shoppers to equate low prices with inferior products.

Bulk deals don't play well in a country where many live in small urban apartments, and the country's grocery distribution system is populated with wholesalers who broker deals between suppliers and retailers, skimming profits. Rival Carrefour abandoned the market years ago. "I have no idea why [Walmart is] still there," says Neil Z. Stern, a senior partner at consultancy McMillan/Doolittle.

Tapped for a Turnaround

Edward J. Kolodzieski is the man in charge of turning Seiyu around. As CEO of Walmart Japan, Kolodzieski has slashed expenses, closed 20 stores, and cut 29% of corporate staff. In-store butchers were removed, with most meat now processed in a central facility. With the freed-up floor space, Seiyu bulked up meals-to-go offerings. To bypass the middlemen, Seiyu has also boosted the number of products it imports directly from manufacturers by 25% over the past year, and is also focusing on increasing sales of its own private-label brands.

The biggest change, however, is a shift away from weekly specials to "everyday low prices" in areas like baby care and pet products, and, eventually, throughout the store. Taking a page from Britain's Asda, Seiyu instead uses its marketing dollars to compare prices against competitors. With the depth of the current recession, argues Tokyo-based business consultant Ken Hasebe, Japanese consumers "have finally accepted that you can buy quality merchandise for a lower price."

One positive sign: Seiyu has been posting positive comparable store sales since last November, including a 1.3% gain in same-store sales in the second quarter. (Comparable or same-store sales is a key retail metric that tracks the results of stores open a year or more.) Still, profit margins declined in the same period, proving that progress is slow: "It's taking a little longer than any of us would have liked," says CFO Thomas M. Schoewe.

India and Russia

India and Russia are widely regarded as two of the world's fastest-growing retail markets—and two of the most frustrating for foreign retailers. Walmart boasts one wholesale outlet so far in India, and it has only a 30-person development office in Moscow to show after more than five years of scouting in Russia. But through a combination of joint ventures, acquisitions, and expansion, the retailer is hoping to become a major player in both.

India's $350 billion retail sector is composed of small family-run ventures, with organized chains accounting for less than 5% of sales. To get around government restrictions on foreign retailers selling to consumers, Walmart recently teamed up with Bharti Enterprises to open a cash-and-carry operation in the northern city of Amritsar. Best Price Modern Wholesale, as it's called, technically caters to merchants and small businesses. But with few restrictions, more than 30,000 members have signed up for the first store.

As in the U.S., the emphasis is on a wide selection of goods in one location at a low cost—everything from Castrol motor oil and sneakers to milk in large canisters that can be tied to the side of bicycles. Best Price employs 25 people to go around the region each week and check prices at mom-and-pop shops, to ensure that they're consistently offering the best value. Raj Jain, a former Whirlpool executive who now heads Walmart's Indian operations, also opened a training institute in Amritsar last December in partnership with Bharti and the Punjab government.

Have Tractor, Will Shop

With so few retail chains, employees have no background in the kind of merchandising and customer service skills needed to work at a large store. They also need to learn how to help customers with goods they have not seen before, such as the Japanese guava that some restaurant owners sampled on a recent visit.

Jain is also tapping Walmart's expertise to buy from farmers directly, cutting out local distributors. About 10% to 15% of Best Price's produce currently goes right from the field to the shelves, and Jain says he wants to increase that to 40% by next year.

Though small, the venture shows promise.

Jaideep Singh and his sister, Shalini, now drive a tractor 25 miles to pick up goods for their father's store. Jaideep says profits are up about 20% because of the low-priced goods that Best Price stocks. "We come two or three times a week," he says.

Confronting Russian Corruption

Walmart plans to open 10 to 15 outlets through the partnership over the next three years, eventually employing about 5,000 people. But McMillon wants to see Walmart running its own retail stores there, too. He pressed his case with commerce and agriculture ministers in New Delhi in July. "What I tried to convey is that we would invest more, and faster, if we had the opportunity to do so," he says. A representative from the Indian government declined to comment.

In Russia, the impediments to retail development are less visible but no less worrisome. Corruption is rampant with various administrative authorities capable of gumming up operations if payments are not made. Anticorruption group Transparency International ranked Russia 147th out of 180 countries on its most recent corruption perception index. In June, Swedish furniture retailer IKEA said it would halt further investment in Russia, citing the "unpredictability of administrative processes." The retailer's stores have been temporarily shut down in the past due to various questionable violations, and IKEA founder Ingvar Kamprad went on Swedish radio earlier this year to link those problems to IKEA's refusal to pay bribes in Russia. (A Russian government representative declined to comment.)

While Walmart is looking at opening its own stores in Russia, it's far more likely it will start by acquiring a local retailer. Analysts say the prime candidate is Lenta, a fast-growing, privately held chain of 34 hypermarkets and the nation's fifth-largest retailer. Lenta founder Oleg Zherebtsov is saddled with debts and sold his 35% stake to the investment group of private equity firm TPG and the private equity arm of Russian state bank VTB in early September. "There was a time when we felt that market was overpriced, and that has changed somewhat," says McMillon. With rivals such as Metro expanding their presence through new stores, and Carrefour opening its second outlet in September, "they cannot wait," says Planet Retail analyst Milos Ryba.

Chile

Chilean shoppers strolling through the aisles of their local D&S supermarket recently came across something not usually offered by the discounter: Apple (AAPL) iPods. That's not the only change coming for the 224-store chain, which sold a majority stake to Walmart earlier this year for $1.6 billion. (It now owns about 75% of D&S.)

In acquiring D&S (short for Distribución y Servicio), the nation's leading grocer and third-largest retailer, Walmart hopes to cement its dominance in Latin America, where it is by far the biggest retailer with $38 billion in sales, estimates research firm Planet Retail, double that of its closest rival, Carrefour. In Chile, Walmart enters a market that has long been inhospitable to foreign retailers. Home Depot (HD), Carrefour, and J.C. Penney are among the companies that have tried, and failed, to make it in Chile, a nation of 17 million with the sixth-largest retail market in Latin America.

Rather than go it alone, as others have attempted, Walmart cultivated close ties with D&S for more than a decade: Bob L. Martin, who ran the international division in the 1990s, says he first visited Chile in 1997. D&S, in turn, modeled much of its business practices on Walmart, looking to Bentonville "as an icon," says Claudio Pizarro, a professor at the University of Chile. (Walmart also imports products like salmon from Chile.)

Financial Services a Draw

Walmart has increased D&S's expansion budget from $150 million to $250 million, which will go toward opening nearly 70 stores this year, many of them small stores that cater to lower-income shoppers, according to Vicente Trius, Walmart Latin America's president and CEO.

The appeal of D&S goes well beyond its stores. About 1.7 million Chileans carry a Presto card issued by its financial services unit, up from 1.2 million in 2004. "There is a saying here that large retailers generate sales with [stores] and earnings with their credit cards," says Rodrigo Rivera, a partner with the Boston Consulting Group in Santiago.

Indeed, some South American retail chains generate upwards of 70% of their profits from financial services, analysts estimate. (At D&S that figure is just 17%.) Walmart already offers financial services in Mexico and Brazil, though its attempts to launch a bank in the U.S. have failed. The retailer is keen to grow the Presto business by adding more low-risk services such as selling life insurance for outside vendors.

Achieving the right balance between local knowledge and global scale is not easy. "We're in the early stages," says McMillon. "But we know you can't run the world from one place."

Boyle is deputy Corporations editor for BusinessWeek.

Copyrighted, Business Week. All rights reserved.

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Hanesbrands Expands Plus-Size Space at Wal-Mart to Revive Sales

By Chris Burritt,
Bloomberg
October 15th, 2009                       [back to top] 

Hanesbrands Inc., the maker of Hanes underwear and the Wonder Bra, is getting twice as much as space in more than 3,500 Walmart stores to offer more clothing choices for the plus-size women who shop there.

Wal-Mart Stores Inc. has started selling an extended line of Just My Size women’s clothes, including dress pants, sweaters and other merchandise beyond the underwear and jeans it already stocked, Maria Teza, the brand’s director, said in an Oct. 13 telephone interview.

“So many of the women who shop at Walmart today fall into the plus-size category,” Teza, 41, said. “She’s already there, whether she’s buying groceries, toys, clothes for her kids. So we really wanted to create a plus-size destination for apparel for her.”

Two New York fashion shows today will introduce the spring collection, ranging in size from 16 to 28, and in price from $6 to $22, she said.

Increasing sales in Walmart, the world’s largest retailer and Hanesbrands’ biggest customer, may help reverse two years of declining revenue, said Scott Krasik, an analyst at C.L. King & Associates in New York.

“An apparel company as big as Hanesbrands needs new ideas, big ideas to grow revenue in totally new categories, such as Just My Size outer wear and active wear,” Krasik said. “It may help them return to revenue growth next year.”

‘Strong Buy’

Krasik raised his rating Oct. 5 to “strong buy” from “neutral,” citing more demand for Just My Size and other apparel. Retailers reduced orders in late 2008 and 2009.

Hanesbrands, based in Winston-Salem, North Carolina, advanced 23 cents to $23.61 yesterday in New York Stock Exchange composite trading. The shares have climbed 85 percent this year after tumbling 53 percent in 2008. Walmart slipped 15 cents to $50.19 yesterday.

Richard Noll, Hanesbrands’ chief executive officer, said this year the company was completing a Walmart agreement. He told analysts in July the contract may provide as much as $75 million in incremental sales next year and eventually add $150 million a year. Total revenue dropped 5 percent to $4.25 billion last year.

Walmart, based in Bentonville, Arkansas, accounted for 27 percent of revenue in the year ended Jan. 3, according to the manufacturer’s annual securities filing.

Comfortably Large

Hanesbrands research found that 60 percent of women shopping at Walmart fit plus sizes, said John Marsh, senior vice president and general manager of the manufacturer’s casual-wear division. About 40 percent of overweight women are comfortable wearing clothes designed as plus size, rather than buying extra- large of regular garments, he said.

Walmart executives weren’t available to comment, Melissa Hill, a New York-based spokeswoman, said.

Walmart’s U.S. stores generated 11 percent of revenue from apparel in the 12 months ended Jan. 31, down from 12 percent a year earlier, as groceries and pharmacy items accounted for a larger share, according to an annual securities filing. Sales totaled $401.2 billion last year.

“Walmart is rather scientific regarding its product performance across many metrics,” Richard Hastings, a Charlotte, North Carolina-based consumer strategist for Global Hunter Securities LLC, said in an e-mail Oct. 13. “If they seem to be adding to plus-size apparel square footage, then they probably see evidence of sufficient demand or they might see an opportunity from a competitor.”

Noll is turning to revenue growth after three years of cost cuts resulting in a net reduction of 5,800 jobs. Walmart sought more of the Just My Size line to replace its private- label, plus-size clothing, Teza said.

One Vision

“When there were multiple brands on the floor, they represented many different visions,” Teza said. “The pieces didn’t necessarily work together.”

Just My Size now accounts for 14 to 16 racks in the average Walmart, she said. That’s double the number before the companies agreed in April to expand. In the spring, signs will offer suggestions on how to mix and match pieces, she said.

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Redlands Wal-Mart opponents file petition

By Jesse B. Gill,
Redland Daily Facts
October 15th, 2009                        [back to top] 

The group hoping to block construction of a Wal-Mart Supercenter carried two boxes containing more than 8,000 signatures into the City Clerk's office Wednesday morning to file a petition. The Good Neighbor Coalition (GNC) is a Redlands-based volunteer organization dedicated to halting the proposed Wal-Mart development. It has been gathering signatures since April for an initiative that could ban Wal-Marts - and similar "big-box" retailers - from building in Redlands.

Member Keith Osajima said the GNC calculated that 15 percent of Redlands would amount to about 6,000 signatures. But because some signatures may not belong to Redlands voters or may not be able to be properly verified by the City Clerk, the GNC tried to get as many as it could.

"We figured we would need a cushion," Osajima said.

City Clerk Lorrie Poyzer has 30 business days to count the signatures.

If the GNC gathered at least 10 percent of verified Redlands signatures, the group's initiative will land on the next scheduled municipal election - in 2010, Poyzer said. If the GNC gathered 15 percent or more, the initiative will appear on a special election ballot.

"Or, the City Council could adopt this ordinance as written," Poyzer said.

The GNC's proposed ballot initiative would allow Redlands voters to decide if they want to prohibit the construction of what it calls "mega-retail development" - stores with sales floors totaling 100,000 square feet or more, where more than 3 percent of the sales floor is dedicated to selling non-taxable merchandise. The proposed Wal-Mart project includes 215,000-square-foot supercenter that would anchor a shopping center on the southeast corner of San Bernardino Avenue and Tennessee Street.

The 45.71-acre shopping center - Redlands Crossing - would include 60,000 square feet of commercial space not to be developed by Wal-Mart.

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Colossal market in Mexico fades amid Walmart era

By Chris Hawley,
The Arizona Republic
October 14th, 2009                      [back to top] 

It was 1 a.m., potato time in Mexico's mother of all markets.

They came in by the truckload, dozens of trailers heaving up to the loading docks to discharge the previous day's harvest into giant potato-cleaning machines. Brokers picked through potato sacks, sealing deals with nods and notes scribbled on slips of paper. There was no time to lose: Soon, the carrots would arrive, then the green beans and fish and flowers.

For 27 years, this huge wholesale market, known as the Central de Abasto, has stood as an urban marvel and the centerpiece of an economy once tightly controlled by the government. A five-story, concrete colossus of 3,755 warehouses connected by miles of passageways, the Central serves as a hub for food and other goods that eventually end up in supermarkets, public markets and street stands. Half the country once got its food from here.

But times are changing. Walmart, Costco and other retailers are building their own megawarehouses and forging deals directly with farmers. Public markets and street vendors, the Central's core customers, have lost customers to chain supermarkets. Small-business owners go to Sam's Club for supplies.

"Four years ago, I was buying 20 tons a day here," distributor José Flores Lazcano, 67, said as he watched wet potatoes pour out of a washing machine. "Now, it's 10. We're not as important as we used to be."

Mexico City's market is the biggest of 64 wholesale markets built in the 1980s and early 1990s as part of the Mexican Food System, a government plan to guard against famines in the wake of several severe financial crises.

It was one of Mexico's last experiments in central economic planning, said Gerardo Torres Salcido, a professor at the National Autonomous University of Mexico who has studied the wholesale markets.

"It's something the United States doesn't have, these huge hubs for food," Torres said. "Up there, companies have their own warehouses, and the supply lines are much more independent."

Mexico City's Central de Abasto opened in 1982, sprawling across an area as big as 600 football fields on the southeastern edge of the capital.

The smells of apples and bananas, of dill and cilantro and dried chiles fill the half-mile-long passageways of its main building. A network of bridges, underpasses and elevated parking lots designed by architect Abraham Zabludovsky moves customers and trucks smoothly around the complex. Thousands of "diableros," or cart-pushers, unload and transport merchandise.

The Central has its own 700-member police force, its own garbage-processing plant, 17 bank branches and a day-care center. But soon after it was completed, Mexico's centralized economy began to change, Torres said. In 1988, President Carlos Salinas de Gortari took office and began dismantling trade barriers, selling off government-owned enterprises, opening the doors to foreign chain stores and laying the groundwork for the 1994 North American Free Trade Agreement.

Retail chains have since exploded. Walmart of Mexico had 753 supermarkets and discount stores in 2008, up from 225 in 2000. Comercial Mexicana had 230 stores, up from 167 in 2000.

Membership warehouses such as Costco, Sam's Club and City Club nearly tripled in eight years, from 57 in 2000 to 152 in 2008. The chains built their own massive distribution centers. In the 1980s, the Centrales de Abasto handled 80 percent of Mexico's food, said Alfredo Neme, president of Mexico's National Confederation of Wholesale Market Merchants. Now, it's about 20 percent, he said.

By 2005, about half the tomatoes and onions sold by Mexico City supermarkets were bypassing the Central and going straight to the chains' own distribution centers, and the trend was spreading to other products, according to a study.

Martin Hernández, who collects zucchinis from small farmers in Puebla state and brings them to the Central, said his sales have dropped by half since 2004 because supermarkets have expanded contracts with farmers.

Raúl Carlos Reyes - a vendor of green beans, peas and chiles - said he used to sell six-hundred 154-pound sacks each day. Now, he sells the same amount of sacks, but each one is only 88 pounds.

Some large farms that had their own warehouses at the market have subdivided their space and rented it out to smaller vendors who mostly handle retail customers, Torres said.

In some cases, the shift to direct sourcing has driven down prices for farmers because the supermarkets tend to be more selective about their produce. But they also demand more expensive packing - cardboard boxes instead of wooden crates, for example, or plastic trays that packing companies have to rent from the stores. That means customers don't always get cheaper produce, according to a 2006 study of Mexico's system by Michigan State University.

Neme said his confederation is urging its 90,000 vendors to stay relevant by modernizing and introducing services that supermarkets want, such as artificial fruit-ripening, Internet ordering and packing in shelf-ready boxes.

"Mexico's economy has changed," he said, "and the Centrales de Abasto can't go on the way they used to."

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Ukiah Wal-Mart is kicking the plastic bag habit

By GLENDA ANDERSON,
THE PRESS DEMOCRAT
October 14th, 2009                        [back to top] 

Wal-Mart has begun eliminating disposable shopping bags at its Ukiah store and two others in California, a move that environmentalists hope will spread nationwide and lead to the demise of the bags that are clogging landfills and littering highways and oceans.

“The potential to really drive this across the retailing supply chain is pretty extraordinary,” said Michelle Harvey, the Environmental Defense Fund’s project manager for corporate partnerships who has been working with Wal-Mart on its green projects.

The giant retailer this month quietly stopped stocking plastic bags in its stores in Ukiah, Citrus Heights and Folsom. The pilot programs will continue through 2010 and determine whether Wal-Mart expands the program to all of its U.S. stores.

The policy already is in place in some of its stores overseas where disposable shopping bags are on the way out.

“We’re committed to reducing the plastic bag waste by one-third by the end of 2013. This test could help,” said Wal-Mart spokeswoman Amelia Neufeld.

When the bags in the three pilot stores run out, shoppers who don’t carry their own shopping bags will have the option of buying one of several reusable Wal—Mart bags, which sell for 15 cents, 50 cents and $1.

That’s already the case at some of the Ukiah store’s checkstands and the store anticipates phasing the disposable bags out entirely by Oct. 25.

Wal-Mart may seem an unlikely environmental hero, but environmentalists are hoping the powerful retailer’s clout will help push disposable plastic shopping bags into oblivion.

The company already has pressured its suppliers to reduce packaging and lessen the amount of mercury in fluorescent lightbulbs, Harvey said.

If Wal-Mart succeeds in convincing shoppers to abandon disposable bags, other stores are likely to follow, she said.

“The ripple effect is just outstanding,” Harvey said.

The idea of banning or limiting disposable shopping bags is not new.

About 20 other countries, including China, have banned or curbed the use of disposable plastic bags, Harvey said.

In the United States, IKEA stores have begun charging for disposable bags, effectively reducing their use.

San Francisco has banned disposable plastic shopping bags at large retail and grocery stores. However it allows paper bags, which some argue are as bad or worse than plastic.

Other local governments in Sonoma and Mendocino counties have been leery of mandating restrictions on disposable bags because manufacturers have threatened to sue.

The least expensive reusable bags the super store is now offering for 15 cents are made from polypropylene and can be reused about 75 times.

They’re washable and can hold up to 100 pounds, Harvey said. When the bags wear out, they can be returned to Wal—Mart for recycling.

Wal-Mart’s goal of reducing its plastic bag waste around the world by 33 percent by 2013 would eliminate 135 million pounds of plastic bag waste and reduce oil consumption by 678,000 barrels of oil every year, Neufeld said.

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County to buy old Wal-Mart

By Matthew Waller,
Standard-Times
October 13th, 2009                        [back to top] 

The Tom Green County Commissioners Court considered two real estate related items at the regular Tuesday meeting.

The court voted to authorize the sale of tax notes so the county can buy and renovate the former Wal-Mart building at 3020 N. Bryant Blvd.

“That’ll be used for two purposes to start with: The Community Supervision and Corrections Department — over half the building will be used for that — and we’ll also be building new offices for Justice of the Peace Precinct 3,” County Judge Mike Brown said.

Tax notes are a form of municipal debt similar to bonds except that they cannot be borrowed for more than seven years, said Larry Skiles, financial adviser to the county.

Steve Floyd, Precinct 3 commissioner, said that although members of the Concho Valley Community Supervision and Corrections Department are state employees, the county is tasked with finding them office space and facilities, hence the purchase of the old Wal-Mart building.

The Community Supervision and Corrections Department aids in the rehabilitation of offenders sentenced to community supervision. It encompasses seven counties.

Floyd said the department’s employees are currently spread out in three separate locations.

“They’re adding additional employees, so we’re trying to consolidate them,” Floyd said.

The court also considered acquisition of the parking lot on the southeast corner of College Avenue and Randolph Street. Floyd said the additional parking may later help expansion of the county jail.

“We’ve been attempting to purchase it for a number of years because it helps us complete that block where the Tom Green County Justice Center is located,” Floyd said.

Floyd said that in the meantime the parking lot will probably still be used for employee parking.

In line with capital improvements, the court accepted an allocation from the Energy Efficiency and Conservation Block Grant (EECBG) Program of $50,000 to renovate heating and air conditioning systems.

Brown said the allocation would go to “electronic energy management controls for the county office buildings,” to make their systems more efficient.

The block grant program has $2.7 billion from the American Recovery and Reinvestment Act to disburse among cities, states, counties and American Indian tribes to “develop and implement projects to improve energy efficiency and reduce energy use and fossil fuel emissions in their communities,” according to the program’s Web site.

In other business, commissioners voted to proclaimed Oct. 28 as “Wear Red Day” and Oct. 25 through Oct. 31 as “National Red Ribbon Week” to raise awareness about the dangers of drug abuse.

“We’re doing a lot with schools throughout the county,” said Julie Alonso, prevention director for the Alcohol and Drug Abuse Council for the Concho Valley.

Alonso gave red ribbons to everyone at the court bench.

As part of the consent agenda, the court agreed to contract Tom Green County’s juvenile detention services to other counties.

“That’s something that we do every year this time of year,” said Mark Williams, chief juvenile probation officer. “There are a lot of counties out there who do not have detention centers. As long as we’ve got space available, as long as we have those empty beds, they pay us $95 a day for as long as that child is detained.”

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Wal-Mart Was Among Major Retailers Targeted in ‘05-‘06 Hack Attacks

By Martha Neil,
ABA Journal
October 13th, 2009               [back to top] 

Although it appears that no sensitive consumer data may have been stolen, Wal-Mart was among the major companies attacked by computer hackers in 2005 and 2006.

Only a fortuitous server crash may have saved the giant retailer from joining the ranks of TJX, Dave & Buster’s and other companies, which had some 100 million accounts compromised all told, reports the Threat Level blog of Wired magazine. As in other such attacks, the would-be Wal-Mart hackers targeted point-of-sale computerized transactions at retail outlets, but the incidents seem to be unrelated.

After the November 2006 crash, Wal-Mart administrators discovered a L0phtcrack password-cracking tool had been secretly installed on one of its servers, causing it to go down. Investigators traced the password tool to a virtual private network account that had been compromised. The VPN account led to a computer in Minsk, Belarus.

Wal-Mart has since enhanced its security, as the company had planned even before the hack attack. The company wasn't required to make the hack attack public because it wasn't clear that any consumer data had been compromised, Threat Level reports.

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Wal-Mart case set for February trial

By KERRI REMPP,
The Chadron Record
October 13th, 2009                      [back to top] 

A trial date has been set in the case against Wal-Mart in the death of a local woman.

David Lehman sued the corporation shortly after his wife, Julie, died after falling in the Chadron store. The case, filed in Dawes County District Court was removed to the U.S. District Court, which has scheduled a trial for Feb. 16. There will be a pre-trial conference in January.

Julie Lehman was in Wal-Mart July 21 with her son, Steffan, 17, when she slipped on a wet floor in the automotive cleaning products aisle on her way to the restroom. According to court documents, Steffan and another patron who heard Lehman fall came to her assistance, and Steffan called 911. Julie received her initial diagnosis and treatment at the Chadron Community Hospital before being flown to Rapid City Regional to have a massive blood clot in her brain surgically removed. Julie never woke up after surgery and died July 27.

Lehman’s lawsuit, filed on his behalf by attorney Monte Neilan, alleges that Wal-Mart either created or failed to prevent a wet, slippery floor through several negligent actions. The papers charge Wal-Mart with failing to have slip-resistant floors, failing to use slip-resistant flooring material, failing to treat/maintain floors with slip-resistant chemicals, failing to monitor/inspect for spills and failing to maintain a clean and dry floor.

The lawsuit also states that Wal-Mart created a condition of danger by displaying liquid on shelves erected over flooring and failed to use “reasonable care” to protect customers like Julie.

As her widower and next of kin, David is asking the court to award him medical expenses in an amount exceeding $50,000 and funeral expenses exceeding $10,000 as well as compensation for her conscious pain and suffering and apprehending death.

David and Julie had two children, Kirsten McCracken, 24, and Steffan, together, and the lawsuit says Steffan was still dependent on his mother for support at the time of her death. David is asking for an amount exceeding $500,000 for Steffan’s loss of past, present and future services and for damages for the loss of Julie’s comfort and companionship to her children.

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Orange County seeks dismissal of Wal-Mart challenge

By STEVE SZKOTAK,
Associated Press
October 13th, 2009                     [back to top] 

Orange County officials asked a judge Tuesday to dismiss an attempt to block Wal-Mart Stores Inc. from building a Supercenter near an endangered Civil War battlefield. The filing by the Board of Supervisors contends preservationists and residents who filed the legal challenge have no standing in the issue and defended the county’s Aug. 25 vote approving the store near the Wilderness Battlefield. “Plaintiffs want to prevent use of land that they do not own, and this suit is a contrived effort to enable them to do so,“ the county filing states. A judge had not scheduled a hearing on the motion, a court clerk said. Preservationists have opposed Walmart’s plans to build less than one half-mile from the Locust Grove battlefield where 30,000 Union and Confederate soldiers were injured or killed 145 years ago. They contend supervisors brushed aside concerns about the negative impact the store would have on the battlefield and approved the special use permit Wal-Mart needed to build the big box store. The retailer described the preservationists’ legal challenge as having “no merit or basis in fact.“ It was filed by the National Trust for Historic Preservation, Friends of Wilderness Battlefield and six residents of Orange and Spotsylvania counties. They did not immediately respond to a request for comment from The Associated Press. Their challenge asked a judge to declare supervisors’ vote “unlawful and invalid” and to block any further county action on Walmart’s site plan. Construction has not begun at the site about 50 miles southwest of Washington, D.C. The planned store generated a national effort by Civil War buffs and historians to block its construction. More than 250 historians, including Pulitzer Prize historian James McPherson, added their names to a petition opposing it. The Wilderness Battlefield is where Robert E. Lee and Ulysses S. Grant first met in a battle considered a turning point in the war. Residents and supervisors who supported the store said it would not diminish an area that already has two strip malls. They welcomed the hundreds of jobs it would bring to the rural community, the shopping option and the estimated $800,000 annually in tax revenue for the county of approximately 32,000. Wal-Mart argued that the site is zoned for commercial use and the store will not be within sight of the battlefield’s 2,700 protected acres.

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Walmart.com launches personal care products online; brands include Pampers, L'Oreal, Colgate

Associated Press
October 13th, 2009                     [back to top] 

Wal-Mart Stores Inc. said Tuesday it has launched a wide offering of personal care products online, including health and beauty items, diapers and over-the-counter medication. The offerings now available online include national brands such as Neutrogena, Pampers, L'Oreal, Colgate and Gillette. Until now, online offerings had been limited to apparel, electronics, home furnishings, sporting goods and toys, according to Ravi Jariwala, spokesman for walmart.com. The announcement follows the company's move late last year to allow shoppers to check its Web site for availability of certain grocery and health and beauty products at local stores. However, shoppers still cannot order groceries on walmart.com. Wal-Mart shares rose 82 cents to $50.43 in Tuesday afternoon trading.

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There's No Magic Bullet for Companies Going Green -- So Just Do It

By Rebecca Cole,
Greener World Media
October 12th, 2009                     [back to top]  

Too many corporate leaders are waiting for a silver bullet to drive sustainability changes in their companies -- and are missing out on a prime opportunity to seize a competitive advantage.

Rather than focusing on simple changes that can be made now, says Matt Kistler, Walmart's senior vice president of sustainability, companies are “dabbling” and waiting for “the thing” that will drive transformational change.

“Shooting big and going for those opportunities we all hope to find,” is a must, Kistler says, “but let’s face it, it takes a long time to implement, it's expensive and requires radical change.”

Instead, Kistler advocates that companies should “do the small things, look for the big ones, but just get started.”

Appearing as part of a panel convened last week in San Francisco by Rocky Mountain Institute at RMI2009, Kistler was joined by HP's Bonnie Nixon, Paul Westbrook of Texas Instruments and Tony Malkin, owner of the newly retrofitted Empire State Building.

Moderated by Adam Werbach, the CEO of Saatchi and Saatchi S, the group discussed how forward-thinking corporations are using sustainability as a key competitive driver.

Ranked the No. 1 green company in America last month by Newsweek, HP is already helping customers reduce their carbon emissions -- developing teleconference technology to replace air travel and using cloud computing to reduce reliance on massive data centers.

But HP is also taking simple steps, Nixon says, such as delivering computers to retailers in stylish, reusable messenger bags rather than boxes. Created in response to a design contest issued by Walmart, HP's design -- which won the challenge -- reduces the amount of product packaging by 97 percent.

Walmart's Sustainability Index, announced earlier this year, is part of a major attempt by the retail giant to develop a more transparent supply chain. The index will show what is in each product and how the product is made -- from raw materials to disposal.

Yet, Werbach asked, can Walmart really justify a sustainability index that isn't all about saving money when customers suffering from job losses and a crippling recession are trying to make every dollar count? And can the company keep prices low but still sell sustainable products?

“At midnight at the end of the month, that's when many Americans finally have money and can go shopping,” Werbach says.

The index is meant to drive innovation throughout Walmart's supply chain and allow customers to evaluate products on something beyond just price.

Last year, by making changes based on sustainability, Kistler says, Walmart increased its income by $200 million just by revamping product packaging. “Rather than paying someone to haul away what we previously thought was waste, we're getting an income stream to help make those small changes.”

The recent retrofit of New York's Empire State Building was a major undertaking to remake an iconic brand known the world over.

“The view of the world towards the Empire State Building was always from the 70th floor up,” Malkin says. “But I wanted it to be the world's most famous office building."

The key to that, he says, and to attracting higher-paying tenants, was to increase the building's energy efficiency and create a better, healthier, more productive workplace.

“It's a viable business model and a way to get a better economic result,” Malkin says. “Without compromise -- the building's not darker, not colder -- we were able to drive change and creating a competitive advantage, that's what drove us.”

Size matters, as HP discovered when, earlier this year, Greenpeace painted the words “Hazardous Products” on the roof of its headquarters in Palo Alto, California. As a $130 billion technology company, Nixon says, HP acts as a tipping point, and while the company's leaders did not take kindly Greenpeace's actions -- to say the least, it did get them talking internally about how to be a leader in driving change.

“From my perspective, when NGOs come to the table and say, 'We've got a problem with this,' we as a company have always said OK, let's figure out what the issues are and come up with solutions,” Nixon says. “When you look at who we are in the market -- the scale, the breadth, the depth -- Greenpeace knew by targeting us it could push the other companies to match us.”

Businesses exist to make money, says Texas Instruments' Paul Westbrook, but they are starting to discover there is a way to make money, be profitable and do the right thing. And when one company does it, others will soon follow.

“You're starting to see corporate peer pressure,” Westbrook says. “Executives are very competitive people and no one wants to be the company that got left behind.”

Nixon, calling it “coop-ition,” says that companies have to work together. “If we go it alone we can go fast, but if we go it together we can go far. We have to get with our competitors and we have to push the envelope.”

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Wal-Mart to pay $11M to settle Iowa workers' case

Associated Press
October 12th, 2009                     [back to top] 

Wal-Mart Stores Inc. has agreed to pay $11 million to settle a class-action lawsuit brought on behalf of 97,000 current and former workers in Iowa over allegations that they were forced to skip breaks or work off the clock. Clinton County District Court Judge David Sivright gave final approval for the deal Tuesday. The lawsuit, filed in 2001, claimed the company failed to compensate workers for off-the-clock work and overtime, altered employee time records and prevented employees from taking lunch and rest breaks. As part of the Iowa settlement, Bentonville, Ark.-based Wal-Mart did not admit any wrongdoing. Wal-Mart announced in December it would pay as much as $640 million to settle 63 lawsuits across the country over wage and hour violations.

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Union members protest at opening of Walmart in Lacey

By BOB VOSSELLER,
APP.com
October 11th, 2009                       [back to top] 

LACEY — Wednesday was opening day for a Walmart Supercenter on Route 9 in the Lanoka Harbor section, where those who turned out included customers as well as a large inflated rat and union members who protested outside.

Community organizer and United Food and Commercial International Workers Union Local 152 representative Gerald M. Chudoff joined around 20 union representatives for the protest.

"We're not here to organize Walmart as a union member, but to educate the community about their practices," Chudoff said.

Chudoff said that the local store originally was not intended to be a Supercenter, which includes a grocery section. He said the store has only three loading docks and would see a lot of truck traffic.

The protesters said the store chain does not provide adequate medical coverage and that the average employee makes about $19,000 a year, which is below poverty level.

"Walmart can do better," Chudoff said. "These are not career jobs. The average employee stays less than a year."

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Impact of new Walmart will reach beyond Saline area

By Paula Gardner ,
AnnArbor.com
October 11th, 2009                       [back to top] 

The impact of the Walmart Supercenter opening this week in Pittsfield Township will be felt beyond falling prices and other money-saving slogans. Walmart anchors the largest retail development in Washtenaw County that’s been completed in recent years, adding more than 200,000 square feet of store space to the US-12 corridor at South State and overnight converting the Saline area into a regional shopping destination.

That Walmart will convert the area around the store into a high-traffic retail center is not in doubt. But who will gain or lose amid that transformation is undetermined.

The store’s scheduled 8 a.m. grand opening on Wednesday will be celebrated by many shoppers, who experts say likely will travel from a 35-mile radius.

Yet area retailers and other business leaders will be watching the opening and its aftermath for signs of how the discount retailer - an aggressive competitor, thanks in part to its pricing leverage with suppliers - will alter the county’s shopping patterns.

The 177,000-square-foot Supercenter will generate over $100 million in sales per year, according to projections by Regency Centers, the Jacksonville, Fla.-based publicly held developer of the adjacent State Street Crossing strip center.

That projection, said leasing agent Ryan Ertel of Regencys, “is based on the demographics and trade area, and the fact that the Ypsilanti store is not a Super Walmart.

“This one will be a little more successful than the other Walmart projects that we’ve done.”

Groceries face the most competition

The Supercenter’s full line of groceries carries the most risk for other area retailers.

“It’ll have its greatest effect on the closest food operators,” said Becky Maccardini, a national retail expert based in Ann Arbor.

The nearest groceries are both outlets in local chains: Country Market and Busch’s. Two of three Ann Arbor-area Meijer Inc. stores are within seven miles of Walmart; nearly as close are two Kroger stores, in addition to Whole Foods.

“Any of the grocers in the area will have to have a clear understand of who their current customer is and why they shop at their stores,” Maccardini said. “If it’s price, they’re likely to be hurt.”

Yet while smaller retailers’ fears about a new, proximate Walmart have been well documented across the United States over the last two decades, downtown Saline may be in a good position to weather the shopping shift.

Bill Kinley, a local developer of both downtown Saline buildings and The Oaks, a strip center along Michigan Avenue, said most operators of downtown Saline storefronts already have made the switch to unique concepts or the types of services that a big-box retailer can’t replicate. Instead of being a feared competitor, he said, Walmart “might bring more people downtown.”

But in the shopping centers between downtown and Walmart, the smaller stores that depend on the grocery anchors for traffic could feel the biggest impact.

“The strip malls will experience some intense competition from the grocery store end of it, “ Kinley said, “… and the secondary stores close to them that depend on them for a draw will see some effect.”

Larry Oesterling, president of the Saline Area Chamber of Commerce, has studied the impact of Walmart moving into a community since the store was proposed - and fought by many nearby residents - several years ago.

“I think they’re not so much in competition with the community (retailers) as they are with other box stores,” he said, citing as an example the Walmart location between two Ann Arbor area Meijer stores.

Reaction among Michigan chambers to Walmart entering a community “has been across the board,” Oesterling said. “Some felt they were not engaged. Some felt it revitalized (shopping).

“It certainly changes the rules,” he said. “…So far we have nothing but positive signs from them.”

Changing growth patterns

The county’s development outlook has changed dramatically since Walmart plans were submitted to the township in 2004.

Home development - once projected to grow rapidly as communities near Saline fielded requests for 1,000-home-plus subdivisions - now may not top 100 new units in 2009.

And both commercial development and leasing have dramatically slowed in response to multiple factors, including a drop in available credit, the lack of market growth and tightening consumer spending. Retail vacancy is up to about 10 percent in the county, said Jim Chaconas of Colliers International in Ann Arbor. Large chain retailers have closed - like Circuit City and Linens N Things - leaving major voids in shopping centers, and some smaller retailers are struggling to pay their rent. National outlets, which once heavily shopped this region because of its high household income and growth potential, now are contracting expansion plans.

Pittsfield Township Supervisor Mandy Grewal said she and her staff are treating the store like any business in the township, servicing permit requests and supporting it with other services as needed.

But, as a supervisor who wants to drive economic growth in the township, she’s also building on some of the concern expressed during the divisive years in the township to pursue a unified development vision.

Pittsfield just launched a master plan revision, which should come before officials by the end of 2010 with “the types of land use we want in Pittsfield Township.”

There will be space for commercial development and land preservation, she said.

“When the economy picks up, we will face development pressures again,” she said. “We want to be ready for when the pressures come.”

Room for more stores

State Street Crossing is ready to absorb additional retail demand as the Michigan and State intersection builds traffic via Walmart.

The center - located in front of the Walmart store on the same corner - was developed and opened before Walmart. Some stores signed leased and opened, anticipating a high-traffic center.

T. Rose, merchandise supervisor for jewelry, puts price tags on jewelry inside the new Walmart.

Angela J. Cesere | AnnArbor.com But as the economy turned and construction was extended into this fall, the wait has taken its toll on progress in the center. “(It’s been) phased in a strange way,” Maccardini said. “That’s probably more indicative of the economy.”

The site, she said, “will function primarily as a Walmart as opposed to a shopping center until they’re able to fill some of the other spaces.”

An indicator of how Walmart’s opening will affect the center can be seen in leasing activity: “We did two deals this month,” Ertel said.

That’s despite, as Kinley said, about the overall market, “retail is not expanding anywhere.”

Of the three buildings, the middle is fully leased, one has 2,800 square feet available and the third - the southernmost- remains vacant.

There also are five outparcels available for development, Ertel said, that likely will end up restaurants - including fast-food drive-thru - or banks.

“Initially when the project kicked off, (interest) was really strong and we were 50 percent pre-leased before we started construction,” Ertel said. “Things changed when the economy turned.

“We expect with Walmart opening, a lot of retailers will re-look to open there.”

Rental rates tell the story

Another indicator of expected Walmart-fueled demand at the property is the rental rate: State Street Crossing spaces rival some of Ann Arbor’s higher-traffic established centers. State Street Crossing has asking rates of $21 per square foot, compared to about $19 at Westgate on the west side of Ann Arbor.

In comparison, Country Creek - about 30,000 square feet just south of Michigan Avenue - asks $14 per square foot.

The highest non-campus retail rates in Ann Arbor are found along Washtenaw Avenue, where Arborland, at over 400,000 square feet, can ask up to $40 per square foot for smaller spaces and Huron Village is asking $35 per square foot.

Traffic counts drive that asking rate, thanks in part by the US-23 exit. Daily traffic counts near Huron Village, for example, are about 34,000 vehicles. That compares to about 24,000 vehicles per day on Michigan Avenue near State.

But those numbers will climb simply because of Walmart. Marketing materials at Lakritz-Weber, the new leasing agent for State Street Crossing, said the location could cater to 80,000 cars per day.

“We expect traffic at that site to (grow) exponentially from the site today,” Ertel said.

That surge in traffic should feed ongoing development at the corner, experts said, even with the slowdown in household growth.

Impact on Ann Arbor

There is a big question over how successful Walmart will be in drawing customers from the Ann Arbor market, which remains the region’s population center and retail driver - thanks to high incomes and population density. There are 1,541 people living within one mile of the new store, but nearly 75,000 within five miles.

The location on South State will give access from the I-94 exit, while traffic from the east can use Michigan Avenue. Still, Maccardini said, it’s not a primary location for most Ann Arbor shoppers.

“It will be interesting to see whether folks will be drawn from the south side of Ann Arbor,” Kinley said. “…It may affect some of the south side Ann Arbor businesses more than people can anticipate.”

The Briarwood Mall and Arborland may be insulated from the effects, Chaconas said. Unclear is the Oak Valley Centre near Ann Arbor-Saline Road, and the Carpenter Road corridor.

“That size store will definitely change shopping habits,” Maccardini said. “Walmart is an extraordinarily competitive retailer.”

Oesterling says it’s inevitable that national chains would enter the Saline area.

He and others in the region are looking to judge Walmart’ success not just on sales, but on how it forges relationships in the community.

“As long as they’re willing to play fair and compete openly and honestly,” Oesterling said, “there’s room for them.”

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Walmart opponents lose court case in Amherst

By Sandra Tan,
The Buffalo News
October 9th, 2009                       [back to top] 

Homeowners fighting the proposed Walmart development at the intersection of Sheridan Drive and North Bailey Avenue in Amherst have lost another legal round but aren’t giving up their quest to keep the megastore from being built.

The Appellate Division of State Supreme Court in Rochester has refused to grant the Hartford-North Bailey Homeowners Association’s request to have its case against Walmart heard by the state’s highest court, the Court of Appeals.

The homeowners association still has the right to directly petition the Court of Appeals for a hearing, which it is expected to do. “It has been their intention to leave no stone unturned,” said Richard J. Lippes, the lawyer representing the association.

He also said the negative response by the Appellate Division in Rochester is typical and comes as no surprise.

Association President Frank

S. Pasztor also said the group is committed to following through with a direct petition to the Court of Appeals.

Plans to put a Walmart in the former Hills-Ames plaza have been discussed since 2006.

During that time, the homeowners association has raised numerous objections, including that unlike many other Walmart projects, the Sheridan-North Bailey location is bounded by residential neighborhoods on three sides.

So far, the homeowners association has had little legal success convincing any court that their situation merits a legal halt to the 185,000-square-foot project, which is a joint venture between Walmart and Benderson Development Co.

In June 2008, former State Supreme Court Justice Joseph

G. Makowski dismissed attempts to kill the project on environmental and procedural grounds. That decision was upheld on appeal by the Appellate Division in June.

Town and Benderson officials have said the Walmart project would occupy a vacant retail plaza that has been dedicated for commercial and retail use for decades. The homeowners group is suing the town Planning Board along with Walmart Stores and Benderson Development. “We continue to believe the town . . . will be upheld in the higher courts,” Town Attorney

E. Thomas Jones said.

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White House Tends to Business With CEO Lunches

By ELIZABETH WILLIAMSON
and NEIL KING JR.,
Wall Street Journal
October 9th, 2009                           [back to top] 

President Barack Obama hosted another in a series of private lunches with company chieftains Thursday, part of an intensified effort to close rifts with the business sector over White House interventions in the private sector.

The meeting brought together chief executives Jeff Bezos of Amazon.com Inc.; Lew Hay of FPL Group Inc.; Antonio Perez of Eastman Kodak Co. and Irene Rosenfeld of Kraft Foods Inc.

White House aides said the group discussed financial-sector recovery, health-insurance reform, climate change, and job-creation policy. The executives, who all declined to comment, furnished credit-card numbers to pay for their lunches, the White House said.

White House officials describe the lunches -- Thursday's was the third hosted by the president since June -- as an effort to smooth relations after a stormy spring and summer marked by collisions between the administration and the corporate world over issues ranging from the auto bailouts and corporate salary controls to proposed overhauls of the health-care and energy sectors.

Many CEOs have also complained about what they perceive as Mr. Obama's anti-business rhetoric.

Participating executives have described the lunches as intimate, off-the-record conversations, and a welcome shift from the scripted, group sessions with business leaders that the Obama White House often held in its first months. After those meetings, some executives complained that they were treated as "props" and not asked for input.

The lunch sessions, aides say, have also offered the president a chance to gather comment from top business leaders on some of his biggest initiatives, above all the drive to remake the nation's health-care system and to push legislation to limit industrial emissions.

Similar meetings in the White House this summer produced accords with pharmaceutical manufacturers and hospitals to cut their own costs, and help lower the overhaul's price tag.

After Thursday's lunch, Mr. Perez of Kodak released a statement through the Business Roundtable, a corporate lobbying group, praising the Democratic health-care bill now in the Senate Finance Committee. The statement said the bill must be revamped to "reduce overall costs sooner."

On Tuesday, White House Chief of Staff Rahm Emanuel and Valerie Jarrett, Mr. Obama's top aide for business outreach, who also attended Thursday's lunch, met for dinner with CEOs Jeff Bewkes of Time Warner Inc.; Dan Neidich of Dune Capital Management; Paul Otellini of Intel Corp.; Jim Turley of Ernst & Young LLP; and Andrew Liveris of Dow Chemical Co.

Business leaders described as "close to the administration" by a White House aide also attended, including Penny Pritzker, chief executive of Pritzker Realty Group and a top fundraiser for Mr. Obama's presidential campaign; Mark Gallogly, managing partner of Centerbridge Partners; and Robert Wolf, chief executive of the UBS Group Americas and another big Obama fundraiser.

"We are looking for ways of having an opportunity to sit down and have constructive dialogue with the business community," Ms. Jarrett said in an interview.

Mr. Obama's two earlier luncheons with corporate executives were on June 25 and July 31.

Guests at those gatherings ranged from Howard Schultz of Starbucks Corp. and Mike Duke of Wal-Mart Stores Inc. to Jeff Kindler of Pfizer Inc. and David Cote of Honeywell International Inc.

Several CEOs went on to meet with Obama cabinet secretaries to discuss policy issues such as job training and high-school dropout rates.

With more small White House sessions in the works, Obama aides say that the president is building a cadre of trusted corporate CEOs to whom he can turn for strategic direction.

That focus reflects this administration's continuing discomfort with corporate lobbying shops such as the U.S. Chamber of Commerce.

The White House asks trade groups for lists of executives to consult, but less often for policy expertise, their leaders say.

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El Cerrito and retailers reach agreement

By Dale F. Mead                     [back to top]

El Cerrito has reached a three-way deal with Safeway, Inc. and Target Corp. to develop the empty Target store property at Hill Street and San Pablo Avenue — one with a last-minute twist: land instead of cash. Proposed a month ago, it was not made public until this week.

Acting as the El Cerrito Redevelopment Agency, at 11 p.m. Monday City Council members unanimously approved an agreement to acquire nearly 38,000 square feet of the property Target would sell to Safeway to develop in the future. In exchange, Target Corp. will forgive a balance of $672,706 on a loan to the agency in 1992 to cover property development costs.

The deal sustains hopes to eventually develop the property with mixed use — residential, retail and office space — to take advantage of proximity to transit hub El Cerrito del Norte Bay Area Rapid Transit (BART) station, with a goal of reducing car use.

The acreage left to the city would enable the redevelopment agency to pursue a mixed-use development at least on the so-called Hill Street parcel. In exchange for retaining the .87-acre parcel, the city waives its purchase option.

It also beats a deal-breaking deadline. The agency held an option until Oct. 27 to buy back the property, empty since July 2008, from Target Corp.; after that, it would have had much less control over how the parcel is developed.

What it does not resolve is the likelihood Safeway will close its current store at Moeser Ave. and San Pablo once the new store opens, which Safeway projects for Aug. 1, 2011.

Safeway's plan comprises a 66,500-square-foot grocery store, 13,600 square feet of additional retail facing San Pablo Ave., and 240 parking spaces. Safeway also agreed to spend up to $487,000 to improve access to the adjacent Ohlone Greenway, due for renovation by BART, or pay that amount to the city, at the city's discretion.

The plan also deeds a separate 37,733-square-foot parcel on the corner of San Pablo and Hill Street, across from the BART station, to the redevelopment agency. Safeway holds veto power over parking plans that would encourage parking in the Safeway lot. The city could sell the parcel back to Safeway to put in retail stores or restaurants.

Until the new plan emerged, the city and Safeway appeared far from an agreement, with a $20 million cash offer from Walmart in the wings. Residents sought mixed-use development for the entire BART-adjacent property, which Safeway rejected outright. It countered with a conventional regional grocery store, adjoining retail stores, and single-story retail and a gas station at Hill Street.

The giant animated illustration projected to the board and audience Monday featured a colorful multi-story building on the corner — placating but hypothetical, since the grocery chain has no intention of building it. The redevelopment agency will have to find a developer to do so.

The latest plan still had its detractors.

Resident Lamar Turner said, "it would be unconscionable to approve the plan proposed." But councilmember Greg Lyman noted, "due to the economic times, our hands were tied. We're setting the standard for the five-acre site with the one-acre site."

After the 5-0 vote was taken, council member and redevelopment agency chair Robert Jones blasted Minnesota-based Target for its handling of the store closure, while praising local Target executives for working with the community.

"I'm very disappointed with (corporate officers)," he said. "They knew what they were doing three or four years ago. They could have worked with us. Instead, they waited till their store was closed, the last possible moment.

"We did the best we could; staff did the best they could," Jones summarized, "We would like to have a better development if we could "... but we do have a time limit, and we don't own the property. Through the cooperation of Safeway, we have a better plan than we might have had."

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Residents Voice Concerns Over Walmart Proposal

WMUR
October 8th, 2009               [back to top]                         

A Manchester neighborhood's fight over a proposed Walmart Supercenter continued tonight. Dozens of passionate homeowners showed up once again to voice their concerns over the plan. The Manchester Planning Board is considering how to handle all the traffic a potential Supercenter would bring. Thursday night was their second public hearing over the 188,000-square-foot store proposal. Walmart hopes to build a new Supercenter on Gold Street, just off South Willow where an abandoned warehouse now sits. Walmart's ideas including putting in a bypass, additional left-hand turn lanes, or even a traffic light. Many at the meeting don't think those measures do enough. A lot of homeowners seem to favor an idea of closing down at least one residential street in the area to traffic. But nearby business owners say that would cause trouble for their customers. The planning board says it will take all comments and recommendations into consideration.

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Wal-Mart Pushes Used Videogames On Its Web Site

By Mary Ellen Lloyd,
DOW JONES NEWSWIRES
October 8th, 2009                              [back to top]

Wal-Mart Stores Inc. (WMT) has begun selling used videogames on its Web site, diving deeper into the category dominated by GameStop Inc. (GME) after testing a used game trade-in program via store kiosks earlier this summer.

The world's largest retailer by sales lists hundreds of titles for various game systems at prices Wal-Mart says are 15% to 30% below new game prices. Most titles indicate the pre-owned version isn't sold in stores, but free shipping to local stores is available.

Internet retailer Amazon.com Inc. (AMZN), Toys `R' Us Inc. and Best Buy Co. ( BBY) have each begun some form of a used game program this year, either issuing credit for future purchases when consumers trade in old games or offering used games for outright purchase.

Wal-Mart this summer put kiosks in 77 stores to accept used games. Representatives for Wal-Mart and GameStop weren't immediately available for comment Thursday.

But Wedbush Morgan analyst Michael Pachter sees little threat of meaningful share loss by GameStop's used-game business as a result of increased competition from other retailers.

"None has thus far been able to attract the core trade-in consumer [unemployed boys], and we think that only Amazon will make inroads with this group," Pachter said in a note upgrading GameStop to outperform from neutral late Wednesday.

Employed customers are less motivated to use games as currency for purchases, he said. GameStop has a competitive advantage in that it encourages teenagers to visit and linger in its stores, he said. "This is not true of Wal-Mart or Toys R Us, and we think that GameStop's openness to this core customer group will provide a competitive advantage for years to come."

Amazon might be able to capture as much as 10% of the market and generate some pricing pressure for GameStop, but that could take five or more years, Pachter said. Meanwhile, store closings by Movie Gallery Inc.'s Game Crazy chain and by Blockbuster Inc. (BBI) reduce competition in the videogame space.

In the current quarter, GameStop should benefit from recent price cuts on videogame systems and an improved slate of new games coming out, Pachter said.

"We expect overall September U.S. retail videogame sales to be up 6% [combined hardware and software], and expect overall industry sales for the October quarter to track better than company guidance of -6 to -11%," he wrote. " Similarly, we think that GameStop's Q4 comp guidance of -1 to -7% is conservative."

Used videogames make up as much as a quarter of GameStop's revenues but at least half the company's profits. Profit margins are also higher on used games than on new software and videogame hardware. Wedbush Morgan estimates GameStop controls about 90% of the U.S. used videogame market.

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Wal-Mart De Mexico Sales, Profit Seen Rising In 3Q

By Anthony Harrup ,
DOW JONES NEWSWIRES
October 7th, 2009                                 [back to top]                         

Retailer Wal-Mart de Mexico SAB (WMMVY, WALMEX.MX) probably increased sales and profit in the third quarter as it lured more people into its stores and stepped up the pace of its 2009 expansion plan.

Walmex, as the unit of Arkansas-based Wal-Mart Stores Inc. (WMT) is also called, is expected to report sales of 64.52 billion pesos ($4.77 billion) for the quarter, according to the median estimate of seven retail analysts polled by Dow Jones Newswires.

That would be an 11% rise from the July-September period of 2008. Earnings before interest, taxes, depreciation and amortization, or Ebitda, probably rose 13% to MXN6.27 billion, with net profit up 12% to MXN3.73 billion, according to the survey.

Walmex's sales grew 11% in the first half of the year, or about 5% after discounting inflation, while Mexico's gross domestic product fell 9.2%.

Same-store sales, which exclude new stores from the comparison, were up a nominal 3.1% through August.

"We are positively surprised by the company's ability to increase its same-store sales in the current economic environment," Santander said in a report.

Also supporting third-quarter expectations, Walmex accelerated its 2009 expansion program in September with 37 store openings during the month. Of the total 270 openings slated for this year, 177 will be in the September-December period. Walmex runs supermarkets, Sam's Club membership stores, clothing stores and restaurants.

Despite the positive expectations, Santander maintained its hold rating for Walmex shares, saying it considers valuations to be "a bit rich."

Walmex V shares trading on the Mexican stock market closed up 1.2% Wednesday at MXN47.77, close to their 12-month high of MXN50 and well above their 12-month low of MXN26.10.

UBS said Wednesday it's keeping its sell rating on Walmex despite positive expectations "because we believe it is still too early to call a turn in the cycle," and "because we see improving results as priced into the shares."

Walmex plans to release its third-quarter earnings report on Thursday after the stock market closes.

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Union protests Wal-Mart negotiations before Salinas City Council

By MIKE HORNICK,
THE CALIFORNIA
October 7th, 2009                     [back to top]

Members and allies of the United Food and Commercial Workers Union demonstrated Tuesday outside the Salinas City Hall Rotunda, protesting the city's handling of the permit process for a new Wal-Mart in Harden Ranch.

The group of about 25 then attended the City Council meeting, where several spoke during the public comment period.

The union offered a variety of objections to Wal-Mart's projected move into the former Home Depot. The city has said the site could open for business within 15 to 18 months.

"You're bringing in a Wal-Mart Supercenter," said Blas Barroso, a UFCWU representative. "I understand we're losing sales tax revenue, but it's not in the grocery industry. You will drive away good-paying jobs to get minimum-wage jobs with no medical benefits."

Wal-Mart intends to devote from 20,000 to 25,000 square feet to groceries in its Harden Ranch and Westridge sites, the city has said. The Westridge store is 139,000 square feet; the Harden Ranch site has 102,000 square feet plus a 28,000- square-foot garden center area.

Barroso questioned whether the city and Wal-Mart had negotiated in good faith. In a June vote, the council rescinded an ordinance banning stores of more than 90,000 square feet from devoting more than 5 percent of retail space to nontaxable items like groceries. It also said the retailer could be subjected to a costly conditional use permit if negotiations on traffic impact and other fees did not go to the city's satisfaction.

"They needed six lanes just to maintain the traffic coming into that Harden Ranch Wal-Mart," Barroso said. "It would have cost over $10 million to upgrade that. Wal-Mart ... said they were willing to give half a million. Who's going to pay the other $9.5 million to upgrade to six lanes?"

City Manager Artie Fields said the council could still consider the conditional use permit.

"Although the council hasn't looked at the CUP option to date, it doesn't preclude them from bringing it back at any point," Fields said. "Staff interpreted [the June vote] as that if we were successful in negotiating with Wal-Mart, that it addressed all the issues the council raised, then the CUP was not something that we needed to deal with immediately. They have addressed all the issues that were raised by the City Council."

Councilwoman Jyl Lutes said she wants to revisit the conditional use permit idea.

"At the beginning of next year I would like it to come back to council," she said.

In other action, Councilman Sergio Sanchez introduced an ordinance that would create a parking permit program for residents of the neighborhoods around Salinas Valley Memorial Hospital. Residents and business representatives packed the chamber. Supporters said permits would keep excess traffic away from their homes, and opponents also spoke out.

A final vote is set for Oct. 20.

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Danger of 'Wal-Mart Effect' in Penang?

By Hazlan Zakaria,
Malaysia Kini
October 7th, 2009                    [back to top]

Traders in Seberang Perai Tengah, Penang, are in a last-ditch battle to stop British-owned hypermarket Tesco from operating in their neighbourhood.

They are not alone in their protest against the opening of a hypermart - a similar refrain is being heard worldwide.

In his book 'The Wal-Mart Effect', Charles Fishman noted that retail giants “reshape the economic life of the towns and cities where it opens stores; it also reshapes the economic life... steadily, silently (and) purposefully moves... (the) economy”.

Fishman claimed that Wal-Mart and possibly others like it have become the most powerful and influential companies in the world. The LA Times business section ran a series of articles in 2003 illustrating the dangers of 'The Wal-Mart Effect', describing the effect that retail giants have in marginalising small businesses and local economies as well as suppliers across the globe with their pricing policies.

One Malaysian example of this was in 2007 when book stores MPH, Popular, Times and Harris withdrew 'Harry Potter and the Deathly Hallows' from their shelves in protest against Tesco and Carrefour for selling the book below cost.

Even publisher Penguin Books chided the two hypermarkets, urging them to practise good business sense and fair trade.

France and Germany are among countries that have imposed strict rules on hypermarkets. The impact on the local economy, environment, traffic, highways and parking availability are the responsibility of big businesses towards society and the environment.

But in Malaysia and other developing countries like Thailand, foreign-owned hypermarkets seem to be mushrooming.

Local traders have claimed that this contradicts the national guidelines on hypermarkets.

If nothing else in Penang, approval of Tesco's new outlet - if confirmed - would paint a bleak picture of the state and Chief Minister Lim Guan Eng.

Traders claimed that, repeated attempts for a response from Lim and the committee on hypermarkets have been to no avail, other than an acknowledgment that the matter has been brought to the chief minister's attention.

Tesco, when contacted, said it would respond to the Malaysiakini report of Sept 29, but has yet to do so. It had earlier announced that it will open 20 more stores in Malaysia.

Convenience for consumers

Consumers, however, often hold a different view of hypermarkets, as surveys in Sungai Petani and Damansara have shown. Local residents are more or less evenly split on the matter.

Seberang Perai resident Mohd Taufik, 24 said: “I prefer to shop in hypermarkets like Tesco because of the conducive environment.”

However he conceded that, with so many hypermarkets in Seberang Perai, especially the recently opened Tesco Extra, another outlet “would be a bit redundant”.

Jamsari Amirul Firdaus of Bukit Mertajam agreed: “A new Tesco is good for the consumers, because it is convenient to have everything under one roof.”

Despite the perceived threat to smaller businesses, it cannot be denied that the presence of hypermarkets can help galvanize the economy in an industrial state like Penang - the demand for consumer goods would boost its industrial production index.

In this respect, Tesco Malaysia signed a deal with local manufacturers on Aug 20 to stock its shelves with locally manufactured products. This is among requirements for foreign-owned hypermarkets to operate in Malaysia.

Whether foreign hypermarkets are bad or good for Malaysia may soon be answered as the grand-daddy of all hypermarkets Wal-Mart may be coming to these shores.

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Brookins vows to 'hound' until city gets second Wal-Mart

By FRAN SPIELMAN,
Chicago Sun-Times
October 7th, 2009                         [back to top]

Ald. Howard Brookins (21st) has vowed to “hound” Finance Committee Chairman Edward M. Burke (14th) until Burke holds a hearing that could pave the way for Chicago’s second Wal-Mart — and first super-center that sells groceries.

At Wednesday’s City Council meeting, Brookins made good on that threat — literally. He placed a stuffed animal of a hound right in front of Burke’s front-and-center seat in the City Council chambers.

Chicago’s most powerful alderman was hardly hounded into submission.

“Not after 40 years,” he joked. “Woof, woof.”

Turning serious, Burke encouraged the world’s largest retailer to get together with union leaders and hammer out a “living wage” compromise.

“They could open 14 stores here in Chicago if they would come to some kind of peaceful agreement with organized labor,” he said. “If they indeed are asserting that they’re paying at least as much to their service workers as the Jewel and Dominicks chains do, there should be a format within which a written agreement can exist.”

Burke noted that Wal-Mart recently entered into a prevailing wage agreement in New Jersey.

“Perhaps they are coming closer to recognizing that this is a labor-oriented city and organized labor has to be respected,” he said.

The City Council’s 2004 vote to approve Wal-Mart’s first and only store in Austin gave birth to the big-box minimum-wage ordinance snuffed out by Daley’s first and only veto.

Now that Mayor Daley’s Olympic dream has gone up in flames, Brookins wants the Finance Committee to approve an amended redevelopment agreement that would pave the way for a Wal-Mart super-center at a former Chatham industrial site at 83rd and Stewart.

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Price Wars in Toyland: Target To Match Wal-Mart's Cuts

By Christina Cheddar Berk,
CNBC
October 6th, 2009                                         [back to top]

Let the holiday price wars begin.

Target is expected to announce that it will match toy price discounts put in place last week by rival Wal-Mart Stores.

The news is not surprising given that toys play a vital role in driving traffic to discount stores during the holidays, and most analysts are expecting consumers to be frugal this holiday season.

Wal-Mart's plans include offering 100 toys for less than $10. These toys include popular brands such as Transformers, Play-Doh, and Barbie.

Target has gone through this list and will match Wal-Mart's prices if it sells those items as well, said Tony Fisher, Divisional Merchandising Manager at Target. The company also is sending out a sales circular this week to shoppers that will include additional toys that will be getting price cuts of 25 percent or more.

Fisher said the promotion is part of its effort to emphasize Target's "low-price promise."

Although it may seem early for retailers to be going head-to-head on toy prices, Wal-Mart and Target weren't the first to start this battle. Toys 'R Us offered "Black Friday-like" price discounts as part of its "Christmas in July" effort.

Also, Sears is ratcheting up its focus on toys and got its holiday efforts off to an early start this summer.

So let the battle begin and brace yourself for more promotions ahead.

The National Retail Federation, which issued their holiday forecast earlier today, and said they expect to see aggressive price promotions this holiday season. In fact, prices in some categories, including electronics, may even be lower than they were year ago.

"Price is paramount," said NRF spokesperson Ellen Davis on the industry trade group's conference call Tuesday.

Ho Ho Hum for Retailers, Holiday Sales to Fall 1% for 2009 According to Davis, consumers will continue to watch their spending closely and research their purchases carefully before they shop.

NRF also expects consumers to stick to the basics this holiday season. In apparel, that might mean jackets and jeans rather than cashmere scarves and sequined clutches. But for many parents, Christmas means there are toys that must be purchased.

Still, it's a challenge for retailers. If you are going to be selling 100 toys under $10, you will need to push a lot of inventory out the door to make up for the lush margins on pricey flat-screen TVs that dominated sales in Christmases past.

Slideshow: Hot Holiday Toys Although the NRF forecast offer retailers little holiday cheer, they have had a year to plan for this tough climate. Discounts this year are likely based on thoughtful planning rather than a knee-jerk reaction to push languishing inventory out the door.

And there are other strategies retailers are using. We're likely to see some savvy merchandising in the weeks ahead.

Also there has been a renewed focus on store brands. Target, for example, has been selling toys under its private label brands, Playwonder and Circo. Although this is a small slice of its overall toy business, the number of products it is offering under these brands are growing.

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Wal-Mart push begins anew

By FRAN SPIELMAN,
Chicago Sun-Times
October 6th, 2009                           [back to top]

Now that Mayor Daley's Olympic dream has gone up in flames, a South Side alderman is turning up the heat for City Council approval of Chicago's second Wal-Mart -- and first supercenter that sells groceries.

Ald. Howard Brookins (21st) said Monday he intends to "hound" Finance Committee Chairman Edward M. Burke (14th) every day until Burke holds a hearing on an amended redevelopment agreement that would pave the way for a Wal-Mart supercenter at a former industrial site at 83rd and Stewart in Chatham.

"The Olympics were a side show to my cause and an excuse for many to say, 'We ought to put this off so that we can have peace with the unions,'" said Brookins, whose ward includes the site.

"Now that those union workers aren't gonna be employed building these fabulous buildings all over the city, at least this is some immediate help for those local tradesmen. . . . And it's a tremendous help to stop the leaking that continues to plague our city with people going to the suburbs looking for a bargain."

Brookins said the argument that Wal-Mart needs to pay a living wage "rings hollow." He vowed to produce copies of union agreements negotiated by the United Food and Commercial Workers representing employees at Jewel and Dominicks.

"Wal-Mart is paying the same wages. It's a red-herring for them to start talking about living wages," Brookins said.

Burke responded to the pressure from Brookins by insisting that Wal-Mart "recognize the long history of involvement in this city by organized labor."

"We would like to have peace with organized labor consistent with what a living wage would be and what community improvements would occur as a result of Wal-Mart coming to Chicago," he said.

As for Brookins' claim that Wal-Mart pays the same as Jewel and Dominicks, Burke said, "If that's the case, then it's incumbent upon the parties to find a vehicle for reducing that to a written agreement. With unions that represent the workers at Jewel and Dominicks, they have a written agreement to that effect. What does Wal-Mart have?"

Pressed on when he would call a hearing, Burke said, "I'm gonna confer with Ald. Brookins. I guess this is his first day of hounding me."

On July 29, Burke and Rules Committee Chairman Richard Mell (33rd) used a parliamentary maneuver to delay the Wal-Mart vote until after the Olympic decision.

The last thing Daley wanted before the IOC vote was another donnybrook with labor that would have jeopardized the labor peace he carefully crafted to bolster Chicago's Olympic bid.

But now that the IOC has chosen Rio de Janeiro to host the 2016 Summer Olympic Games, Brookins said there are "no more excuses" for putting the brick on Wal-Mart.

The Council's 2004 vote to approve Wal-Mart's first and only store in Austin gave birth to the big-box minimum wage ordinance snuffed out by Daley's first and only veto.

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Could Wal-Mart and BlackBerry be the future of medicine?

MassDevice
October 6th, 2009                           [back to top]

Don't try this at home (unless you really hate your phone) but if you want an idea of how biotech industry guru Steve Burrill looks at the future of medicine, hawk a loogie onto the screen of that BlackBerry.

That's because, in Burrill's world, by 2020 healthcare could be boiled down to the simple act of spitting onto a chip embedded on your mobile phone, which would then instantly analyze your personal genotype and provide a proper clinical pathway.

"It's predictive, like a GPS," Burrill told a group of roughly 400 biotech industry representatives at the annual Massachusetts Biotechnology Council Investors Conference Tuesday. "The future of healthcare is an information-centric business, where diagnostics will one day trump therapeutics."

Burrill, who is no stranger to predictions (his annual forecast for the biotech industry is in its 23rd edition), said the future of healthcare is shifting towards predicting and preventing chronic illnesses, rather than managing them. That's good news to him because, in his words, managing chronic diseases is "bankrupting the world."

"For 2000 years healthcare has remained relatively unchanged, in that we wait for disease to occur and then we treat it," he said. "In the next 10 years, we'll have a system that prevents illness."

Building business models that embrace that future, rather than focusing on what's occurring today, is the only way to build sustainable companies, he added. And while the current bloodletting of companies because of the financial crisis is painful, the environment of funding people's "passions, hopes, and dreams" created thousands of companies with no way to achieve sustainable success, he said.

Despite some grim predictions that more companies will be closing up shop in the near future, Burrill said he's optimistic about the state of the industry — though he admitted that the elephant in the room was the fact that there are more than 135 biotech companies with less than a year's worth of cash in the bank.

On the bright side, Burrill pointed out that the biotechnology industry raised more than $40 billion during the first nine months of the year, which he called "incredible."

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Wal-Mart Scales Back DVD Displays

By NAT WORDEN,
Wall Street Journal
October 5th, 2009                      [back to top]

A recent shift in merchandising strategy by the world's largest retailer spells more trouble for DVD sales and the entertainment industry that depends on them for profits.

As part of a larger effort to clean up its aisles and appeal to higher-end shoppers, Wal-Mart Stores Inc. is doing away with display cases to promote the latest hot movie titles.

The move comes as major film studios are reeling from declines in revenue from DVD sales as cash-strapped consumers turn to low-cost rental services and digital downloads for home movies.

"We think the new strategy implies Wal-Mart no longer sees DVDs and Blu-ray discs as traffic drivers," J.P. Morgan analyst Imran Khan said.

Studio chiefs dispute that conclusion, noting the importance of DVDs as a sales category for Wal-Mart, but none would speak publicly for this story.

Wal-Mart, which accounts for nearly a third of DVD retail sales in the U.S., didn't respond to inquiries for comment.

The change to its DVD selling strategy is part of a larger merchandising overhaul the company calls "Project Impact," in which it has been devoting more shelf space to top-selling products and cutting back on items that linger. The discount giant also is trying to spruce up its image and cut back on clutter in its aisles, like corrugated displays for DVDs, in hopes that it can attract a more upscale shopper.

As for DVDs, the Digital Entertainment Group estimates that overall U.S. retail sales fell 13.5% to $5.4 billion during the first half of 2009. At the same time, DVD rentals rose by 8.3% to $3.4 billion. Digital sales and rentals from services like Amazon.com Inc. and Apple Inc.'s iTunes rose 21% to $968 million.

Video on-demand revenue from pay-TV service providers, like Comcast Corp., is also rising. Comcast spokeswoman Jennifer Khoury says the company served 368 million total views on its VOD platform in July, up 11% from last year.

Meanwhile, studios have cut deals with services like Netflix Inc., the mail-order DVD rental service.

Meanwhile, Wal-Mart and other major retailers, along with several fast-food chains, have been adding low-cost DVD rental kiosks near store entrances provided by Redbox Automated Retail LLC, a division of Coinstar Inc.

Redbox's prominent placement and its overnight rental price of $1 are viewed by film studio chiefs as a threat to sales. Three major studios -- News Corp.'s 20th Century Fox, Time Warner Inc.'s Warner Brothers and General Electric Co.'s Universal Pictures -- are locked in a legal battle with the company and refuse to make their new titles available to Redbox until 28 days after their release. News Corp. owns The Wall Street Journal.

Starting with just 12 kiosks in 2004, Redbox is now expected to have 22,000 machines across the country by year-end.

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Wal-Mart plans to crush competition more than usual

By Douglas A. McIntyre,
Daily Finance
October 5th, 2009                             [back to top]

Part of the Wal-Mart (WMT) legacy is that it moves into regions with its huge stores and uses low pricing to push local retailers out of the market. This may give consumers more buying power, but it has caused many local communities to resent the effects of Wal-Mart on mom-and-pop stores.

Wal-Mart now plans to go from hurting sales at smaller stores to hurting sales at its more direct rivals. In an exclusive interview, the company's CEO Mike Duke told The Wall Street Journal that he plans to slow gross margin growth. This means that the world's largest retailer is giving its stores the green light to cut prices on merchandise below their current "everyday low prices".

Allowing gross margins to flatten at Wal-Mart may be particularly hard on its rivals in the food retail business and on consumer electronics companies like Best Buy (BBY).

Investors have to wonder why Wal-Mart has been so slow to make such a critical decision. Why has it waited so long to lower prices in order to take more market share during a recession -- especially when it can use its wholesale buying power and balance sheet to significant advantage?

The answer is probably as old as the retail industry itself. Store owners have always been faced with the choice of either keeping prices and margins high, or lowering prices to get market share. Wal-Mart is about to make another push for market share which may improve its sales, but could drop margins low enough to hurt earnings.

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Wal-Mart Sharpens Its Pricing Pincers

By JOHN JANNARONE,
The Wall Street Journal
October 5th, 2009                              [back to top]

Investors hoping for a big retail performance next year should beware the Wal-Mart effect.

In a way, the recession has been a break for the world's biggest retailer, directing more traffic to its stores at the expense of pricier rivals. And while many retailers reduced spending and slashed prices, Wal-Mart Stores has actually spent more and avoided aggressive price cuts.

But with comparable-store sales barely growing, Wal-Mart appears ready for an offensive that could hobble rivals' hopes for a sharp profit rebound. Following unusually high gross-margin growth in recent quarters, Wal-Mart Chief Executive Mike Duke told The Wall Street Journal Thursday he expects gross margins to be more stable. That could mean the company will cut prices faster and put more cheap products on its shelves.

That could put Wal-Mart's smaller rivals further on the defensive. Take grocery stores. J.P. Morgan's Charles Grom says prices of identical baskets of 31 products have fallen 14.4% between January and September at Kroger, while Safeway has seen a 9.7% decline. Wal-Mart, meanwhile, has only lowered prices by 2.6%.

Even so, Wal-Mart is still cheaper. Its basket costs $92.77, compared with $100.98 at Kroger and $113.03 at Safeway. If Wal-Mart gets more aggressive in using its scale, rival grocers will likely have to cut prices further, translating into gross-margin declines.

Other rivals such as Best Buy could also suffer if Wal-Mart offers better deals on consumer electronics. Best Buy already saw its U.S. gross margins decline 0.6 percentage point last quarter as it competed with Wal-Mart and Amazon.com. While the economy will probably be better for retailers next year, investors should remember how fiercely Wal-Mart can compete.

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September Sales May Foreshadow Holidays

By Rachel Dodes,
Wall Street Journal
October 5th, 2009                  [back to top]

Retailers and analysts will be closely watching September sales reports due Thursday from key store chains for any sign they may need to adjust their already-gloomy holiday forecasts.

Two analyst reports predict that Christmas-season sales will be flat with last year's dismal results while a third projects they will fall 1%. Stores have been slashing inventories in hopes they can avoid profit-sapping price cuts.

Retailers also are planning plenty of bargains to lure thrifty holiday shoppers. Wal-Mart Stores Inc. says it will offer about 100 toys priced at $10 -- compared with just 10 such toys last year. Consumers are still "under a lot of pressure," said Wal-Mart's chief executive, Mike Duke.

For consumers, "it's a badge of honor to not spend as much as they used to," Linda Heasley, CEO of specialty retailer The Limited, said at a retail conference in New York last week.

Analysts are looking to the September sales figures for stores open a least a year -- a key measure of retailers' health and consumer spending -- for clues about Christmas. These results are predicted to fall 1% to 2% compared to September 2008. That would be a harbinger of a season filled with bargain hunting and last-minute gift shopping.

The projected September decline is particularly worrisome because a late Labor Day and later school-start dates helped boost the month's sales, and a decline in September sales last year makes year-ago comparisons easier.

The numbers will be reported Thursday by about 30 retailers, including Macy's Inc., Target Corp. and Gap Inc., but exclude Wal-Mart Stores Inc. and Best Buy Co. because they decline to report monthly figures.

The International Council of Shopping Centers is forecasting a 2% decline in same-store sales for September compared with a year ago.

Market research firm Retail Metrics' same-store sales index is expected to be down 1% compared with September 2008, in which sales fell 0.1%.

Thomson Reuters is anticipating a 1.2% average decline in September verses a year ago for its index of 30 retailers, compared with a 0.8% decline a year ago.

View Full Image

Getty Images Shoppers at Manhattan Mall in New York last month, when sales again were weak. The expected declines will follow reports last week that the U.S. jobless rate hit a 26-year high of 9.8% and that car sales fell 23% last month following the end of the government's "cash for clunkers" incentive program, underscoring that a consumer-spending rebound could be a long time coming.

"'Recovery' doesn't mean that you recover," said Mike Niemira, chief economist for the ICSC shopping-center trade group. "It just means you turn the corner."

For the holiday season, Deloitte Research and Retail Forward both are forecasting sales will be flat compared with last year, when sales for November and December combined slipped 2.8% to $447.5 billion, according to the National Retail Federation, which will release its own holiday-sales estimate Tuesday.

Archstone Consulting is slightly less optimistic, with the Stamford, Conn., firm predicting holiday sales will fall 1% this year. That would be the first consecutive yearly sales decline in at least 40 years, since the government began collecting sales data.

"There's not one reason to support sales growth this season," said Todd Lavieri, chief executive of Archstone.

The biggest challenge for stores entering the season is getting inventories in line with demand. Retailers are slashing inventories as much as 23% in a bid to preserve profit margins, according to a study by AlixPartners LLP. In a recent survey of retail finance chiefs by BDO Seidman LLP, 60% said having too much inventory will pose a greater risk to holiday sales than having too little.

Best Buy CEO Brian Dunn said last week that his chain has seen increased demand for electronics in recent months and is adjusting inventory and labor plans as it heads into the holidays accordingly. Still, Best Buy is emphasizing competitive pricing in its marketing, not just on lower-priced electronics such as $300 netbooks but on more expensive TVs and computers.

Some demand is returning to the toy category, Toys 'R' Us CEO Gerald Storch said, pointing to the early strong sales of Zhu Zhu Pet Hamsters, $8-$10 battery-operated rodents embedded with a smart chip that makes them behave differently depending on which room of their $19.99 hamster habitat they are in.

Gerrick Johnson, a toy analyst at BMO Capital Markets, predicts that toy sales will fall 1% this Christmas, compared with a 5% slide last year.

Full-price specialty retailers and department stores will likely continue to struggle. Same-store sales for the department store category have been negative for 21 of the past 22 months, according to Thomson Reuters.

Off-price chains, which sell department-store overstock, are projected to be among the strongest performers in September. "If things ease up just slightly in the consumer's pocketbook, that could be very meaningful for us" in terms of holiday sales, said Sherry Lang, senior vice president of investor relations for TJX Cos., which includes off-price retailers T.J. Maxx, Marshalls and HomeGoods.

For Michelle Christensen the recession means more shopping at retailers like T.J. Maxx, and fewer visits to Nordstrom.

Last month, the 29-year-old sales manager bought two pairs of sunglasses at T.J. Maxx in Chicago. Still, she threw in an orange purse for $40. "I don't need an orange purse. It's totally impulse," says Ms. Christensen.

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Court upholds $2M award to Wal-Mart pharmacist

Associated Press
October 5th, 2009                 [back to top]

The highest court in Massachusetts has upheld a $2 million jury award to a former pharmacist at Wal-Mart Stores Inc. who claimed she was fired by the retail chain after asking to be paid the same as her male colleagues. Cynthia Haddad was fired in 2004 after more than 10 years at a Walmart store in Pittsfield. In 2007, a jury found that the company discriminated against Haddad, and awarded her $1 million in compensatory damages and another $1 million in punitive damages. A judge later revoked the $1 million award for punitive damages. On Monday, the Supreme Judicial Court reinstated the punitive damages and upheld the total $2 million award. Wal-Mart Stores Inc. claimed Haddad was fired because she allowed a technician to use her computer security code to issue prescriptions during her absence.

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New Walmart in Hamburg, What Happens to Old One?

By kristin donnelly,
WGRZ TV
October 4th, 2009                            [back to top]

October 28th, the new Hamburg Walmart is set to open on Southwestern Boulevard.

With it's fancy white columns and new fixtures, it's supposed to look like a nearby country club, not a Walmart.

"They wanted a building that wasn't the typical Walmart look," says Andy Delasandro, the store manager.

Delasandro showed us around the new Walmart prototype. Wider aisles, concrete floors, LED lighting, even skylights. This one also adds a full grocery store. Overall, Delesandro says a more customer friendly atmosphere. It also adds more than 200 jobs.

But, the current location is less than 3 miles away on McKinley Parkway. When the new store opens, it will close. Then what?

"How tough is it to want someone to re-use an old Walmart building?" Kristin Donnelly asks.

"They've been very successful in the past at doing that," Delasandro says.

But town development officials aren't too sure, not just about Walmart, but any big box store.

"It's a challenge, a real challenge especially in these times and the economy the way it is," says Mike Bartlett, Hamburg's Executive Director for Development.

This summer a new Walmart opened in Niagara Falls on Military Road. The old location, Porter Road, is still vacant and for sale. We found it online listed for $2.3 million.

The old Hamburg Walmart is also for sale. The asking price for that Walmart is $3.75 million.

But, it's not just Walmart. It's been four or five years and Hamburg is still shopping a vacant K-mart in the Town Hall Plaza. But, it's the kind of thing people notice.

"They kind of stick out there like sore thumbs," said Bartlett.

Although, he adds there is much less vacant space than people think.

But, redevelopment of those old stores is tough. There are almost no tax incentives for retail and unless another kind of business wanted to move in, local development corporations can't give any tax breaks for big box retail.

So many times, the stores sit vacant for years.

"Does Walmart have any responsibility to get something in there quickly?" Kristin Donnelly asks.

"You hope so but I don't see what kind of pressure you can put on them. Walmart is Walmart. They'll do what they want," Bartlett says.

The town supervisor points out, before Walmart moved into it's new location, that plaza was old and littered with vacant stores. That was bulldozed to make way for Walmart's new building, nearly double the size of the old store.

The Supervisor says the town actually has more leased space now, even if the old store sits vacant and more jobs.

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Women a Big Force in Business, Study Finds

By Ylan Q. Mui,
Washington Post
October 3rd, 2009                       [back to top]

Women-owned businesses generate about $3 trillion in revenue and employ 16 percent of the workforce, making them significant players in the national economy, according to researchers who conducted a benchmark study released Friday.

The study was led by the nonprofit Center for Women's Business Research with sponsorship from Women Impacting Public Policy, a nonpartisan group, and Wal-Mart, the world's largest retailer. The research provided an in-depth look at the economic impact of women-owned businesses, which were defined as privately held companies at which women held at least a 50 percent stake. According to the study, those businesses employ 23 million people, nearly double the number of the 50 biggest companies in the country combined.

Advocates for women in business said the results are a wake-up call for those who consider women to be niche players.

"This really gives us good, secure statistics to go to policymakers with," said Margaret Barton, executive director of the National Women's Business Council.

The study was released during the Economic Summit for Women Business Owners at the W Hotel in D.C., convened by Wal-Mart and WIPP. Among the top issues for members were access to capital for small businesses, the impact of the government's stimulus programs and the cost of health care.

Marion Bonhomme owns Knowledge Connections, a telecommunications engineering and consulting firm based in Herndon. She said her main concern was securing financing. Her bank reduced her line of credit and increased interest rates and fees in the wake of the credit crunch, she said. That has forced her to lay off 10 percent of her more than 100 employees.

"I could not get the financing in order to support them," she said.

Bonhomme said she hoped that attending the summit would allow her voice -- and those of other women business owners -- to be heard.

Wal-Mart, the main sponsor of the event, said about 40 percent of the business members of its Sam's Club division are women who own small businesses. Chief executive Mike Duke said that was one reason behind the retailers' decision to participate.

"This is real. We really are committed to you and your business," he told the roughly 300 women at the event.

Wal-Mart has been the target of the nation's largest class-action sex-discrimination lawsuit, which was filed in federal court in 2001 and is still winding its way through the legal system. During the summer, Duke pledged to increase the number of women promoted within the company and established an advisory "global women's council." Wal-Mart was also a founding sponsor of WIPP, and the company's human resources director, Susan Chambers, is chairwoman of WIPP's corporate advisory board.

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Wal-Mart taps Asia to nudge growth

Associated Press
October 3rd, 2009                      [back to top]

The chairman of Wal-Mart Stores Inc. is warning that the global economic recovery will likely be lethargic, even as the retailing behemoth sees great growth potential in China and India.

"The world recovery is going to be led by Asia, although it's going to be very challenging. I think this recovery is going to be a slow one," said Robson Walton.

Walton said "sales have been tough" for Wal-Mart, the world's biggest retailer, even though it was benefitting from the economic downturn as more people shop at discounters for bargains.

Walton said international operations accounted for a third of Wal-Mart's global sales, and the proportion was expected to increase as the group focuses on larger markets in Asia.

Wal-Mart has more than 250 stores in China but only ventured into India in May to tap the country's $430 billion retail market.

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Woman Opens Fabric Shop When Wal-Mart Closes Department

By Kristie Avery,
Texarkana Gazette
October 3rd, 2009                             [back to top]

Entering the room you hear the whirring hum of a sewing machine, a slight clicking sound as a needle makes contact with the fabric.

A few laughs in a conversation combine with the tinkling of straight pins in a tin as fingers rummage through trying to pick one up.

The sounds aren’t from a quilting bee but from the only fabric store to be found in Hope — Jeni’s Simply Stitching in downtown Hope.

“People kept saying they had to drive to Texarkana to buy fabric,” Jeni Francis, owner, said. “I’ve sewed for years, being self-employed as a seamstress. So this is what I know.”

Open since May with Civil War period dresses and other handmade items decorating the walls, Francis said the response has been positive so far.

“People come in telling me they’re glad I’m here, especially with stores like Wal-Mart discontinuing their fabric department,” Francis said. “For me, it wasn’t complicated. My kids are grown and I needed something to do.”

Growing up in the area, sewing is something she has carried with her, literally, around the globe.

As a military wife, she’s lived everywhere from the Aleutian Islands off the coast of Alaska to Europe to Virginia Beach, Va.

“We moved back here to Hope in 2004. This is the longest we’ve been in one place,” she said.

Living around the world, she made sure her daughters, Briana and Margaret, knew how to sew.

“I hated my first projects. But I love to sew now,” Briana said. “I make dresses and other items for Civil War re-enactments. Some think sewing is only for women, unnecessary for boys and men. But I show men how to patch and sew.”

From the muted colors of the calicos and homespuns, the cheery checks of gingham, to pastels and soft, snugly baby materials, Jeni’s carries the basics for now. All of the fabric in Jeni’s shop come from 100 percent natural fibers.

“We’ll add things as people want and find a need for,” Jeni said. “It’s just going to take a while to build up.”

Offering sewing lessons, providing custom sewing and embroidery and taking special fabric orders, these are things customers like to hear.

“It’s so good to have a fabric store so close now,” said Hope quilter Wilma England. “When we need something and with Walmart’s fabric department gone, we’d have to drive to Kirby or Texarkana. Driving to Kirby is a lot farther than Texarkana. We don’t have to do that anymore with Jeni’s store.”

When Jeni’s Simply Stitching went from concept to reality, Jeni took the path most small business owners aren’t able to financially.

“I used my savings to buy my inventory. No loans or anything,” she said. “I wasn’t thinking about the economic conditions. There just seemed to be a demand, so I just did it and opened the store.”

Fabric shops were very popular in Hope during Mark Keith’s childhood in the 1960s and 1970s.

As director for Hope, Ark.-Hempstead County Chamber of Commerce, Keith is excited to see the shop and its promising future.

“I’ve answered more inquiries about Jeni’s store than just about any other one we’ve had open this year. That lets me know there’s a demand for her product and service. I believe we’ll be drawing people from 50 miles away to shop at Jeni’s before long, said Keith.

“I’m really excited Jeni has decided to meet the demand for fabric and sewing supplies since these products can’t really be bought anywhere outside a big town these days.”

Francis believes its small specialty shops like hers helping to jump start the local economy.

“This is what keeps small towns going, specialty shops like this,” she said. “ ... Small towns need specialty shops and it’s common everyday people that will get the economy going again.”

Sitting in front of see-through bins full of buttons and ribbons, Jeni meticulously works on an apron, feeding the material carefully through the machine. To watch her is like watching an artist put the first paint stroke on a blank canvas.

“It’s a lost art. Those who do sew are usually older and they don’t teach it in school anymore,” said Jeni. “Nowadays people don’t even know how to hem pants or sew a button on. I think they’re at a disadvantage because we’ve become a one-size-fits-all society.”

Briana agrees with her mother.

“It marks a difference in civilization, I think. I’ll teach my kids to sew,” the younger Francis said. “It’s a part of a legacy. We all have something to pass on. To me this is something worth while.”

Jeni doesn’t understand why young people wouldn’t want to express their creativity through sewing.

“I understand there may not be enough time in the school day for it but I think there are some who would really like it if they tried,” said Jeni. “They could design their own clothes, have more clothing options. They have to go to the extreme to express their creativity.”

Though sewing and fabric shops may not be mainstream enough for people, according to Briana, it’s what makes Jeni happy.

“I get a lot of requests to make little girl dresses. My favorite items are little quilts and doll clothes,” Francis said. “The most difficult item to make are bonnets. It takes hundreds of hours to make. It’s so labor intensive.”

As the hum of the machine continues, Jeni, concentrating on the fabric being fed through the machine, is satisfied with her accomplishment.

“It’s been a big education,” she said, “But it’s fun.”

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Retailers Expect Flat Christmas Sales This Year

By STEPHANIE ROSENBLOOM,
The New York Times
October 2nd, 2009                                      [back to top

In the retail business, it is never too early to think about Christmas. So a lot of people are thinking about it, and taking surveys to test the mood of the American consumer, and deciding that this Christmas will be as bad as last — which is to say, one of the worst on record.

Retailers are relieved to hear that prediction. Flat sales this holiday season would at least mean that things had stopped getting worse.

“It’s reflective of this ‘new normal’ we’re in,” said James Russo, vice president for global consumer insights at the Nielsen Company. “Flat is good.”

Over all, the retailing industry posted a sales decline of about 2 percent last Christmas season, the weakest performance since the late 1960s, when the Commerce Department began tracking holiday sales figures. Results for stores that sell clothing and luxury goods were far worse, typically declining by double digits. By contrast, several reports published in the last few days, including surveys by Nielsen and Deloitte, forecast no change in holiday sales from last year to this year.

While recent economic reports have been mixed, several indicators suggest the economy is beginning to improve. But the turnaround, if it is real, has yet to filter through to retail sales, which are closely tied to the unemployment rate. That rate worsened more than expected in a government report on Friday, rising to 9.8 percent.

Analysts say that many consumers are still worried about their jobs, their stock portfolios and the value of their homes. They remain hamstrung by a tight credit market. Few experts foresee a robust recovery in consumer spending until the unemployment rate starts heading down, perhaps sometime next year.

If a mood of thrift and penury continues into the holiday season, retailing analysts said the beneficiaries, not surprisingly, would be discount and dollar stores, warehouse clubs and Internet retailers, as shoppers across all income levels spend less and make fewer trips to stores.

A holiday study published by Nielsen this week found that 85 percent of households expected to spend the same or less this year than last year.

People are also continuing to nest in their homes. This Christmas, sales of necessities and items associated with at-home entertainment are expected to fare best: cookware and other kitchen sundries, consumer electronics, DVDs, alcohol, tobacco and bed and bath accessories. The Nielsen report said upscale retailers should consider stocking practical items because affluent households may forgo jewelry and designer bags for the likes of generators, fireplace accessories, kitchen gadgets and family games.

As has been the case throughout the recession, higher-priced categories like jewelry, sports equipment and vacations are expected to be hurt most. Industry experts said that would probably lead merchants of those items to offer compelling discounts, some of which will pop up before Thanksgiving.

Indeed, Moody’s Investors Service said in a recent research note that while clothing retailers had brought their inventory in line with weaker demand, the holiday season “may be more promotional than anticipated, as consumers have learned to delay shopping in anticipation of higher markdowns.”

Already, major big-box chains are jockeying for the discretionary dollars of consumers.

Wal-Mart said this week it would bring a $10 toy section back to all of its stores, repeating a successful strategy from last Christmas. It will offer many more toys, for a wider variety of age groups, at that price. The offers will include classic board games like Monopoly, childhood favorites like Barbie dolls and Tonka trucks, a Hot Wheels Trick Track and a Lego Bionicle Legends set. Additionally, Wal-Mart said it would match any local competitor’s advertised offer on the same toy if the price fell below $10.

On Tuesday, Kmart published a “Fab 15” toy list, highlighting a layaway program that lets consumers reserve popular items early, pay over time, then pick up their purchases before the holidays arrive.

The stores may have good reason to begin competing for consumers’ Christmas dollars before Halloween even rolls around. According to Wal-Mart’s customer research, 70 percent of consumers are planning to start their holiday toy shopping before Halloween.

Analysts closely watch discount chains because when consumers begin spending discretionary dollars after an economic downturn, they typically do so at discount and value-priced retailers first. As time goes on and the economy recovers, consumers move up to specialty retailers. Many analysts have said that if consumers spend more this holiday season at the likes of Wal-Mart and Costco, that bodes well for specialty stores come 2010 and 2011.

Mr. Russo said studies by Nielsen had found that consumers were indeed “expressing a desire to move back into the discretionary categories although — and this is really key — at moderate levels.”

In another positive sign, Ted Vaughan, a partner in the retail and consumer products practice at BDO Seidman, said, “Retailers are starting to ramp up their inventory purchasing” for next year, referring to a BDO Seidman survey of chief financial officers at major chains.

The International Council of Shopping Centers, an industry trade group, published one of the most optimistic of the holiday reports so far, forecasting a 1 percent year-over-year sales increase in November and December for stores open at least a year.

“Does the retail industry need a miracle to have positive year-over-year sales growth during the 2009 holiday season?,” the report said. “No, but should you see Kris Kringle at the Macy’s Thanksgiving Day Parade, put in a request for one anyway!”

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Wal-Mart Angles to Keep Those Who Traded Down

By ANN ZIMMERMAN
and MIGUEL BUSTILLO,
Wall Street Journal
October 2nd, 2009                        [back to top]

Mike Duke became chief executive of Wal-Mart Stores Inc. in February at the depths of the recession, an unusual sweet spot for the world's largest retailer.

As the economy weakened, Wal-Mart's low prices had lured upscale shoppers looking for bargains on household necessities. Now, Wal-Mart faces the challenge of holding onto its new, higher-income shoppers as the economy slowly recovers.

Mr. Duke, the former head of Wal-Mart's international business, must spur growth in an increasingly saturated U.S. retail landscape while seeking opportunities abroad.

At the same time, he is diving into Washington politics as the company weighs in on such controversial issues as health care and the deferral of international taxes. In a wide-ranging interview, Mr. Duke talked about how he views the impact of the still-turbulent economy through a unique lens: a company that serves 140 million U.S. customers a week.

Excerpts:

WSJ: What is your expectation for a robust recovery in consumer spending?

Mr. Duke: Our customers are still under a lot of pressure. We can see it by the way they shop, the products that they purchase and the timing of their purchases.

We have started seeing in recent months that at midnight on the first of the month, we can see the customer there in the store, more than a year ago. That tells us that there is even more pressure on the pay cycle, and on the customer that is receiving benefits [that] the government provides.

WSJ: What are your expectations for the holiday season?

Mr. Duke: There will be a Christmas, there will be a holiday season. It will be late. Last year, when this crisis had begun, many retailers looked at a fourth quarter with declining sales; we didn't. We actually picked up traffic and new customers. Last-minute shopping was very strong. I expect that to be the same, maybe even more so.

WSJ: Your sales gains started to slacken recently. Why?

Mr. Duke: We sell a lot of food, and we sell a lot of electronics. In the second quarter the rate of deflation was significant. Our [profit] margins have been good, but not because of deflation. It's not our strategy, nor do we expect, to have increased gross margins over time. Our DNA is to generate savings to pass on to customers.

WSJ: What are customers buying? What is drying up?

Mr. Duke: There are some global trends. Customers are buying basic needs but are not spending as much on apparel. Consumers in mature and developing markets have said, 'I will invest in my basic needs but defer on discretionary items.' (Please see related article on page B5.)

We had a milestone a couple of years ago when we began offering generic drugs for $4. That really accelerated customers thinking of Wal-Mart as a place to go for pharmaceuticals.

What is interesting, vitamins have been strong. You might think that would be something customers would cut back on. But customers say, 'I have to stay healthy. I can't afford to miss work. I can't afford to get sick.'

WSJ: Wal-Mart has become more involved in politics on issues such as health care. How much of your own time do you devote to Washington?

Mr. Duke: Tomorrow [Friday] will be the sixth time I will be in Washington. My involvement is more about expressing a point of view about our associates, our customers, trying to represent them. These big issues that the country faces and the world faces are Wal-Mart's issues too, and we think that it's important that a company like Wal-Mart weighs in. It's good for our shareholders.

WSJ: Wal-Mart has improved its reputation substantially. How did it happen?

Mr. Duke: At times I step back and say, if someone is critical of us, 'Is there a valid point? Is there something we can learn from it?' And over time I think that has caused our relationships to improve.

The area of sustainability was one where we employed a great deal of advice from outside the company. And we saw that we could make great progress, that it was good for our business, and as a byproduct that it was also good for our reputation, and good for our brand.

WSJ: Is there anything you would have done differently?

Mr. Duke: We're doing a lot of things right. But we need to do them faster. For example, sustainability is saving millions of dollars and benefiting our customers and the planet. In some cases, it is important we focus.

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Wal-Mart Seeing Customers More Challenged As Holiday Approaches

By Karen Talley ,
DOW JONES NEWSWIRES
October 2nd, 2009                                     [back to top]

Wal-Mart Stores Inc. (WMT) is seeing more consumers living very close to the bone, with government assistance programs its fastest growing payment method and customers arriving at stores at midnight on the first of the month, when their paychecks or relief payments come in.

The phenomonon is even more pronounced than a year ago, said Mike Duke, who became Wal-Mart's chief executive earlier this year. "Our customer is still under a lot of pressure," Duke said Thursday in a talk with The Wall Street Journal and Dow Jones Newswires.

The statement reinforces indicators that while other areas of the economy may be showing signs of life, consumers are still struggling.

Wal-Mart itself continues growing and doing well during the recession, with its low costs resonating. Duke did say that the company expects gross margin next year to not see much growth or contraction. In its last fiscal year, Wal-Mart's gross margin grew 40 basis points.

Duke said he expects consumers' difficulties to continue for some time, with people holding back until as late as Christmas eve this year to do their holiday shopping, hoping for the very best prices. He said consumers' spending habits have changed for the long term, with frugality a lasting approach.

The trouble is apparent all over the world, with consumers in established and emerging countries all having changed their spending habits, he said. "They invest in basic needs and but defer on discretionary."

At best, demand for apparel, a very discretionary item, has stabilized, or stopped continuing to go down, Duke said.

But one product that can be considered discretionary, vitamins, is doing well and the reason may well be founded in the recession.

"It's a preventative investment," Duke said. "People say, 'I can't afford to get sick.'"

Duke continues seeing "considerable" opportunity in the U.S., while international operations will be the company's fastest grower.

Wal-Mart is also balancing margin growth against keeping prices lower than competitors.

Wal-Mart's strategy is to drive "the lowest cost platform to create increasing price leadership not to drive higher margins," said Colin McGranahan, retail analyst at Sanford Bernstein & Co., who initiated coverage of Wal-Mart this week with an equal weight rating.

Wal-Mart's business approach also means the company has "limited fundamental risks," McGranahan said.

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Wal-Mart De Mexico Invests MXN2 Bln To Open 37 Stores In Sep

By Ken Parks,
Dow Jones Newswires
October 2nd, 2009                                  [back to top]

Mexico's largest retailer Wal-Mart de Mexico SAB (WALMEX.MX) said Thursday that it invested about 2 billion pesos ($145.3 million) to open 37 new stores last month.

In a press release, Walmex, as the Mexican unit of Wal-Mart Stores Inc. (WMT) is known, said it now has a presence in 245 cities.

Walmex said it opened 29 of its Bodega Aurrera low-income supermarkets, four Walmart stores, three Sam's Club outlets and one Superama supermarket.

Chief executive Eduardo Solorzano said last month that Walmex planned to open 270 stores this year, of which 177 would be opened in the last four months of the year.

Walmex operated 1,295 supermarkets, clothing stores and restaurants as of September 3.

Walmex's V shares fell 2.9% to close at MXN45.59 amid a 2.2% decline in the benchmark IPC stock index.

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Woman wins $422,000 in lawsuit after accident at Vestal Walmart

By JENNIFER MICALE,
PRess & Sun Bulletin
October 2nd, 2009                            [back to top]

A state Supreme Court jury awarded a 55-year-old Hallstead, Pa., woman $422,000 for an injury she suffered after falling in the Vestal Walmart parking lot.

Penny Donlick, 55, fell June 25, 2008, when one of her crutches got caught in a pothole, according to the office of Binghamton attorney Ronald Benjamin, who represented her.

The trial before Judge Ferris Lebous started Monday. The jury returned about 6 p.m. Thursday.

Donlick, who worked in a blue-collar job at Penguin books, smashed her knee. In January, she lost her job because she was no longer capable of the physical labor it entailed, Benjamin's office said. While she's off crutches now, she'll likely need a knee replacement.

Walmart had a one-sentence reaction to the jury's verdict.

"We respect the jury's decision, and care deeply about the safety and well-being of our customers," said Michelle Bradford, senior manager of corporate communications.

"I started crying when I head the verdict," Donlick said.

She had gone to Walmart that day to get a prescription and fell hard on her knee. She still gets pain and swelling from the accident.

The jury's award is going to help her tremendously, Donlick said. The judgment means she will be able to maintain herself financially and buy medical insurance, she said. She credited Benjamin for the favorable verdict.

"I said a prayer to God," she said. "I didn't want to be greedy. I just wanted something that's fair."

While the accident has been a painful ordeal, Donlick said she still shops at Walmart.

"I like the store," she said. "It was nothing personal. It was just an unfortunate accident."

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Council puts squeeze on Walmart

By Robert Speer,
newsreview.com
October 1st, 2009                                 [back to top

Walmart may be a giant retailer with a reputation for bullying, but that didn’t seem to intimidate members of the Chico City Council at their meeting Tuesday (Sept. 29). They went right ahead and put the squeeze on the mega-corporation.

After deliberating for more than 2 1/2 hours, they voted 5-2, with Councilmen Jim Walker and Larry Wahl dissenting, to deny the company’s application to expand its Forest Avenue store into a supercenter by adding 82,000 square feet of floor space. But they carefully left the door ajar for possible reconsideration of their decision, on condition that Walmart do more—much more—to benefit the community.

As Councilman Scott Gruendl put it, “We’re looking at the largest retailer that exists in the universe, and I’m just asking them to get up off the floor and do more.”

At issue were what are called “overriding considerations.” In order to approve a project whose environmental-impact report has identified significant and unavoidable negative environmental impacts, as the Walmart project does, the council must determine that its benefits to the community provide the “overriding considerations” that outweigh those impacts.

As Gruendl pointed out and other council members verified, this is an independent judgment call each of them must make. And, as it turned out, five of them determined that the touted benefits of the project did not make up for its negative impacts.

Each arrived at that determination in a different way. Councilman Andy Holcombe, for example, didn’t believe that the project would produce much in the way of new jobs, one of its supposed benefits. He thought it would cause as many, or nearly as many, job losses as job gains.

Gruendl was concerned that the proposal failed to deal with potential traffic problems caused by Business Lane, a private road, and its relation to the much-impacted intersection at the entrance to the Chico Mall.

When City Attorney Lori Barker informed him the city had no legal way to require Walmart and the other owners of Business Lane to upgrade it, Gruendl replied, “I want the record to be clear. When we approved the Costco expansion, Costco stepped up and went beyond what we asked them to do.” The city may not be able to require it, he added, but he also could decide not to make a finding of overriding considerations.

Gruendl also doubted that the project would produce 150 new jobs and said the company could gain his support—the phrase “sweeten the pot” was used—by agreeing to give hiring priority to employees of any store in the area forced to close because of Walmart.

Finally, he suggested that the company do more to mitigate the air pollution caused by the expansion. Noting that Chico was the third-worst area in the state when it came to fine particulate matter in the air, he suggested Walmart contribute to the county Air Quality Management District’s wood-heater change-out program. He even gave a figure: $1 million. That would be sufficient to buy a new, EPA-certified wood heater for all of the low-income Chicoans who need one.

Then it was Mayor Ann Schwab’s turn. She reminded everyone that the city is committed to reducing greenhouse-gas emissions by 25 percent by 2020. “All you have to do is look across the highway [from Walmart] and see what Sierra Nevada is doing” in terms of solar energy, she said, adding that the city and Butte College are also leaders in sustainability.

“It would make sense for Walmart to put in solar” on its new facility, she suggested.

As the list of conditions lengthened, Councilman Larry Wahl, a consistent supporter of the project, lamented, “If we bleed these guys dry [and] kill the golden goose, who else would want to come here?”

For much of the discussion, it was difficult to tell how the final vote would go. Wahl mounted a spirited defense of Walmart, aggressively calling for it to be treated as any other land-use proposal would be treated, and for most of the discussion seemed to have at least two other council members in his corner.

On several occasions he turned to city staffers, asking them such questions as whether Walmart was an inferior project (no), whether it conformed to the city’s economic-development strategy (yes), and whether it was a major contributor to the city’s tax base (yes).

He also argued passionately for the council to avoid deciding “winners and losers in the marketplace” and to let free and fair competition differentiate among businesses. “It’s not our job to predict the future,” he said.

Walmart, he insisted, serves the 20 percent of the people in Chico and Butte County who live below the poverty line and “have to make their dollars go further.”

Councilman Jim Walker also supported the proposal, though not as enthusiastically as Wahl. Indeed, he said he had to separate out his personal feelings about Walmart in order to make an objective determination on a land-use application.

After studying the matter deeply, he said, he’d decided that the negative environmental impacts simply weren’t large enough to warrant denial. Both traffic and air-quality impacts were relatively inconsequential, he said.

And, for some time, it appeared Councilwoman Mary Flynn supported the project. She talked at some length about benefits it would have beyond those described in the EIR, especially enabling local food manufacturers to get a trial shelf run locally that—if the items proved popular—could spread throughout Walmart’s vast distribution system.

“We need to get beyond the sales-tax and jobs positions to see Walmart’s larger [positive] impacts,” she said.

She also disagreed with Holcombe’s contention that the project conflicted with the general-plan land-use designation for the site, arguing that the designation was “ambiguous” and that “we shouldn’t cherry-pick language in the general plan to deny this project.”

And she worried about the 300,000 square feet of current empty retail space mentioned by the city’s economic-development director, Martha Wescoat-Andes. “We need to remember,” she said, “that the demand still exists. We’re in a precarious position to lose consumer spending that leaks to outlying areas.”

Still, when it came to finding overriding considerations, she lined up with Gruendl and the others—Tom Nickell, Schwab and Holcombe—who wanted Walmart to do more.

Walmart attorney Meriam Montesinos said the company was willing to have further discussions, and the council set a special meeting for Nov. 10 to reconsider the project.

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Six Wal-Mart Supercenter Projects Pending in the North State

By Kelli Saam ,
KHSL TV
October 1st, 2009                             [back to top]

This week the proposed Wal-Mart Supercenter project in Chico has attracted much attention. But there are six Supercenter projects currently pending from Willows to Redding.

Chico: Tuesday night the Chico City Council rejected the proposed expansion of the existing Wal-Mart store on Forest Avenue. But council members will look at some concessions from Wal-Mart that might allow the project to move forward. Council Member Scott Gruendl suggested he might support the project if Wal-Mart offered incentives to offset the impact increased traffic would have on the city's air quality. That could include paying $1 million dollars to swap out older, polluting wood stoves for low income residents. But some Wal-Mart supporters say that sounds like blackmail and extortion. Wal-Mart supporter Robin Cook said "I think that I wouldn't allow my children to extort money like the city council extorted people (Tuesday) night. But I guess that's why politics are so distasteful to so many of us." Scott Gruendl told Action News "what the real blackmail is, is when projects do not fully mitigate their impacts, the taxpayers will pick that bill up for years to come, that's the blackmail." City staff will meet with Wal-mart officials over the next few weeks to iron out the new requests. The council will take up the issue again November 10.

Paradise: Wal-Mart's plans to build in Paradise are moving forward. Wal-Mart is proposing construction of a 164,000 square foot Supercenter store at the entrance of Paradise off Skyway Crossroad. Wal-Mart owns the property. Building applications were submitted to town officials earlier this month. If the application is complete, then it moves to the town council for review and a vote. Opponents are already gearing up to fight the construction.

Red Bluff: Wal-Mart has already won approval from the city council to build a new Supercenter next to the existing store. But after 5 years, the project is tied up in the courts. A judge is expected to rule in the next month on two lawsuits filed to block the project. Opponents claim it would create too much noise and challenged the first and second environmental impact reports. Even if the judge rules in favor of Wal-Mart, the case could head to appeals court. Construction has not begun.

Oroville: Wal-Mart has proposed construction of a new Wal-Mart Supercenter, to replace the existing store. The city attorney says planners are now working on the environmental impact report. Wal-Mart wants to build the new store on 20 acres of vacant land at Feather River Boulevard and Cal-Oak Road. The project has been in the works for about 2 years. The draft EIR should be complete in 45 days, then comes public comment. It could come up for a public hearing in spring of 2010, and could be up for a vote of the city council in the next year.

Redding: Expansion of the existing Redding store is in the construction phase.

Willows: Expansion of the store in Willows is nearing the construction phase.

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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)