WAL-MART'S REVERSAL OF FORTUNE DUE TO ITS ANTI-FAMILY AND ANTIEMPLOYEE INITIATIVES
Randy L. Harrington
November 03, 2006
NOVEMBER 3, 2006—It's been a tough month for Wal-Mart as its pattern of poor business practices have caused its stock to tumble, sales to remain flat, growth plans to be scaled back, and earnings to fail. This reversal of fortune is just the American people speaking to Wal-Mart and telling them that they need a change to reverse their downward spiral. Wal-Mart stock lost 3.63% of its value in October, and 6.31% in just this week alone While rivals Costco gained 4.30% in value, and Target gained 1.4% in value.
This week Warren Buffett's company Birkshire Hathaway bought 5.5 million shares of rival Target stock instead of increasing its stake in Wal-Mart. A clear cut example of a lack of confidence in Wal-Mart.
Investors are showing their discontent with Wal-Mart, and perhaps America as a whole are beginning to send a signal to Wal-Mart that enough-is-enough.
Wal-Mart's same store sales in September were below the projected 2% to 4%. In October the same store sales were even lower than September at .50%, and Wal-Mart says that similar figures for November will also be flat. On the other hand Target sales in September grew 13.4%, while Wal-Mart's only grew a dismal 11%.
Over the last 5 years Wal-Mart's stock has lost about 5% in value, and has had a glass ceiling in price that can't seem to be broken. Wal-Mart's slippery slope of a reversal of fortunes is simply becoming more pronounced which will definitely impact its earnings estimates.
ANTI-FAMILY AND ANTI-EMPLOYEE INITIATIVES
Wal-Mart is not good for America. Their “big-box” stores, unfair purchasing power, and anti-competition business practices cause the quality of life to sink in the communities that it establishes itself in. Wal-Mart forces competition out of business. They claim that their pay and benefits are competitive, only after they invade the market place, and decrease the quality of life for local employees are their pay and benefits competitive.
Wal-Mart tries to balance the negative effect their presence has in a community by giving huge amounts of money to charitable, and community organizations. They publicize the billions of dollars given to communities, but downplay the double windfall that they reap from these billions of dollars in charitable contributions.
Wal-Mart gets to set the standard of living in its local communities, drive out its competition, and gain an appreciable amount of public relations from its charitable giveaways and donations.
Wal-Mart also profits from the enormous tax write-offs that its charitable donations create.
Wal-Mart is generous when it benefits them. But charity should begin at home. Wal-Mart's charitable activities can be compared to the next door neighbor who beats his wife, and starves his kids but goes to Church on Sunday.
Wal-Mart's anti-family, and anti-charitable initiatives begin with its 1.38 million American employees that they like to call “Associates.” The majority of Wal-Mart's employees live below the poverty level, without health care, and have to depend on welfare benefits to live.
Wal-Mart gives billions of dollars away to charitable causes each year, and then caps its employees wages, and denies these hard working employees a pay raises, and affordable health care. At the same time Chief Executive Lee Scott who made $5 million dollars last year, will make over $7 million dollars this year because of new executive and pay increases for Scott, and Wal-Mart executives.
Wal-Mart Executive Vice President Susan Chamber told the Board of Directors last year that its 1.38 million American workforce is old, fat, lazy, and expensive, and that Wal-Mart should replace them with younger, healthier, part-time employees who use less benefits, and cost less money.
Wal-Mart's new attendance policy for its workers means that they can be fired for getting sick, or taking care of a medical emergency involving their child or family member.
Generally conservative Wal-Mart who has curried favor with the GOP in the United States has in an effort to latch onto anything with a foundation has now began to endorse non-GOP groups, and causes.
Wal-Mart now supports and embraces Gay and Lesbian organizations with a political agenda, and has now embraced and supports Planned Parenthood in their pro-choice causes, and critics have began to boycott and turn on Wal-Mart because of these “anti-family friendly” values and associations.
The way Wal-Mart treats its employees, and its openly hostile anti-family agenda leanings could be erroding its bottom line, impeding its growth, and causing its stock price to go south as shareholders begin to realize that “Always low prices...Always!” can be applied to the value of Wal-Mart stock, as well as the “Made in China” products on its store shelves.
PUBLIC RELATIONS PROBLEMS AND NON-SOLUTIONS
Filmmaker Galloway a former Wal-Mart supporter who made a film that praised Wal-Mart: “Why Wal-Mart Works: And Why that Makes Some People Crazy” had a change of heart this year when he met with a Wal-Mart employee who was featured in his film. The lady was upset over Wal-Mart's recently announced pay caps. Galloway told Business Week in August “The lady was distraught because she would never get another pay raise at Wal-Mart,” he says. “I think that profiting on the backs of long-term employees isn't right.” This is especially repugnant when Wal-Mart claims that it is the same 1.38 million employees that contributed to their success in the first place.
Wal-Mart has taken billions of dollars out of their employees mouth to hire a stable of public relations professionals, and political consultants. Its now fired PR firm, Edelman formed a sham advocacy group to give all glory and praise to Wal-Mart: Working Families for Wal-Mart. Working Families for Wal-Mart was formed last December, and is entirely supported and financed by Wal-Mart.
The Working Families group has been cause for consternation for Wal-Mart lately, and has probably done more damage to its already questionable image that was planned.
Former UN Ambassador Andrew Young was appointed by Wal-Mart to head the Working Families group. Young resigned in shame 6 months later after he made a public statement that Jewish, Korean, and Arab store owners had been ripping off the urban communities for years.
Things went from bad-to-worse when the Working Families group created more controversy by hiring a couple for their “Wal-Mart Across America” campaign. “Jim and Laura” drove cross-country in an RV and made up stories of alleged interviews of people it met in Wal-Mart parking lots. They published these questionable, and allegedly bogus stories on the “Wal-Marting across America” blog. Business Week exposed the real story behind Jim and Laura when it reported that Wal-Mart's Working Families group were paying Jim and Laura's expenses, and to write their stellar reports on the Wal-Mart blog.
Wal-Mart has hired the best political consultants using money that could have been used to give its 1.38 million American workers a better standard of living. Political Consultants like Michael Deaver former adviser to President Ronald Reagan; Democratic strategist Charles Baker; Jonathan Adashek, a strategist for Jon Kerry; Taylor Gross, who handled President George W. Bush's communications; and controversial Terry Nelson, who was President Bush's 2004 consultant and created an alleged racist political ad in Tennessee.
Last year Wal-Mart created multi-million dollar executive public relations position to its already top-heavy and bloated executive management stable. The company hired Leslie Dach in August paying him an undisclosed salary, but $3 million dollars in stock, and options on 168,805 Wal-Mart shares over the next 5 years. Dach was the vice-chairman of Wal-Mart's now fired PR firm- Edelman when he was hired. Dach was also the former media adviser to President Bill Clinton.
As far as Dach is concerned, despite evidence to the contrary, everything at Wal-Mart is great and 70% of all of American's approve of Wal-Mart.
Consumers are no longer shopping at Wal-Mart because of its reputation regardless of what Dach says.
McKinsey & Company, a consulting firm, completed a study for Wal-Mart that Dach apparently hasn't read, that concludes that 2%-to-8% of Wal-Mart customers have stoppe dshopping there “because of negative press they have heard.”
Wal-Mart has taken some action designed to reverse its image, but those things are too little and don;t really address the problems. For instance Wal-Mart has changed employee uniforms; rolled back prices on their toys and electronics; established a gift registry known as a “wish list; offered $4 generic prescription drugs; and revamped its web site. They have spent millions of dollars in changing advertising agencies, and hired an expensive executive that used to work for Target. But, al of these hollow and disingenuous efforts will not change the bottom line, and obviously don't change the fact that American's are beginning to see Wal-Mart as the greedy corporation it is.
Expansion plans at Wal-Mart have been scaled back in step with their negative growth and probable diminished earnings during one of the busiest times of the year for all retailers.
Chief Financial Office Tom Shoewe told analysts this month that the company will increase its capital spending by only 2%-to-4% in 2007-2008, which is a far cry from the 15%-to-20% spent in 2006-2007.
It's the recognition of Wal-Mart's greed that has resulted in the reversal of its fortunes. While Chief Executive Lee Scott gets his million dollar pay, and executive benefits increases this year, he has forsaken the majority of his hard working employees that have contributed to Wal-Mart's billions in annual profit.
To reverse this decline in fortunes Wal-Mart simply must stop and recognize its 1.38 millions employees with real pay raises, and affordable health care benefits. Wal-Mart's policies governing its employees must be family friendly, and fair.
As Scott and his executive managers enjoy the fruits of hardworking Wal-Mart employees this Holiday season, and offer $4 prescription generic drugs, and increases charitable contributions the American public should understand that these thing are provided at the expense of Wal-Mart's employees who are struggling to provide their families with food, and health care during the Holidays. As more American's see what Wal-Mart greed is all about, and the high costs of their low prices, their voice will be heard, and Wal-Mart will continue the slide down its slippery slope – the reversal of its fortunes.
SOURCES/CONTRIBUTORS: BUSINESS WEEK; WALL-STREET JOURNAL; MARKET WATCH; AP; SEC; www.WalMartFacts.com; www.WalmartWatch.com; www.freewebs.com/WalmartArizonaUnion; www.ArizonaWalMartUnion.blogspot.com
Copyright 2006 Randy L. Harrington. ALL RIGHTS RESERVED.
This week Warren Buffett's company Birkshire Hathaway bought 5.5 million shares of rival Target stock instead of increasing its stake in Wal-Mart. A clear cut example of a lack of confidence in Wal-Mart.
Investors are showing their discontent with Wal-Mart, and perhaps America as a whole are beginning to send a signal to Wal-Mart that enough-is-enough.
Wal-Mart's same store sales in September were below the projected 2% to 4%. In October the same store sales were even lower than September at .50%, and Wal-Mart says that similar figures for November will also be flat. On the other hand Target sales in September grew 13.4%, while Wal-Mart's only grew a dismal 11%.
Over the last 5 years Wal-Mart's stock has lost about 5% in value, and has had a glass ceiling in price that can't seem to be broken. Wal-Mart's slippery slope of a reversal of fortunes is simply becoming more pronounced which will definitely impact its earnings estimates.
ANTI-FAMILY AND ANTI-EMPLOYEE INITIATIVES
Wal-Mart is not good for America. Their “big-box” stores, unfair purchasing power, and anti-competition business practices cause the quality of life to sink in the communities that it establishes itself in. Wal-Mart forces competition out of business. They claim that their pay and benefits are competitive, only after they invade the market place, and decrease the quality of life for local employees are their pay and benefits competitive.
Wal-Mart tries to balance the negative effect their presence has in a community by giving huge amounts of money to charitable, and community organizations. They publicize the billions of dollars given to communities, but downplay the double windfall that they reap from these billions of dollars in charitable contributions.
Wal-Mart gets to set the standard of living in its local communities, drive out its competition, and gain an appreciable amount of public relations from its charitable giveaways and donations.
Wal-Mart also profits from the enormous tax write-offs that its charitable donations create.
Wal-Mart is generous when it benefits them. But charity should begin at home. Wal-Mart's charitable activities can be compared to the next door neighbor who beats his wife, and starves his kids but goes to Church on Sunday.
Wal-Mart's anti-family, and anti-charitable initiatives begin with its 1.38 million American employees that they like to call “Associates.” The majority of Wal-Mart's employees live below the poverty level, without health care, and have to depend on welfare benefits to live.
Wal-Mart gives billions of dollars away to charitable causes each year, and then caps its employees wages, and denies these hard working employees a pay raises, and affordable health care. At the same time Chief Executive Lee Scott who made $5 million dollars last year, will make over $7 million dollars this year because of new executive and pay increases for Scott, and Wal-Mart executives.
Wal-Mart Executive Vice President Susan Chamber told the Board of Directors last year that its 1.38 million American workforce is old, fat, lazy, and expensive, and that Wal-Mart should replace them with younger, healthier, part-time employees who use less benefits, and cost less money.
Wal-Mart's new attendance policy for its workers means that they can be fired for getting sick, or taking care of a medical emergency involving their child or family member.
Generally conservative Wal-Mart who has curried favor with the GOP in the United States has in an effort to latch onto anything with a foundation has now began to endorse non-GOP groups, and causes.
Wal-Mart now supports and embraces Gay and Lesbian organizations with a political agenda, and has now embraced and supports Planned Parenthood in their pro-choice causes, and critics have began to boycott and turn on Wal-Mart because of these “anti-family friendly” values and associations.
The way Wal-Mart treats its employees, and its openly hostile anti-family agenda leanings could be erroding its bottom line, impeding its growth, and causing its stock price to go south as shareholders begin to realize that “Always low prices...Always!” can be applied to the value of Wal-Mart stock, as well as the “Made in China” products on its store shelves.
PUBLIC RELATIONS PROBLEMS AND NON-SOLUTIONS
Filmmaker Galloway a former Wal-Mart supporter who made a film that praised Wal-Mart: “Why Wal-Mart Works: And Why that Makes Some People Crazy” had a change of heart this year when he met with a Wal-Mart employee who was featured in his film. The lady was upset over Wal-Mart's recently announced pay caps. Galloway told Business Week in August “The lady was distraught because she would never get another pay raise at Wal-Mart,” he says. “I think that profiting on the backs of long-term employees isn't right.” This is especially repugnant when Wal-Mart claims that it is the same 1.38 million employees that contributed to their success in the first place.
Wal-Mart has taken billions of dollars out of their employees mouth to hire a stable of public relations professionals, and political consultants. Its now fired PR firm, Edelman formed a sham advocacy group to give all glory and praise to Wal-Mart: Working Families for Wal-Mart. Working Families for Wal-Mart was formed last December, and is entirely supported and financed by Wal-Mart.
The Working Families group has been cause for consternation for Wal-Mart lately, and has probably done more damage to its already questionable image that was planned.
Former UN Ambassador Andrew Young was appointed by Wal-Mart to head the Working Families group. Young resigned in shame 6 months later after he made a public statement that Jewish, Korean, and Arab store owners had been ripping off the urban communities for years.
Things went from bad-to-worse when the Working Families group created more controversy by hiring a couple for their “Wal-Mart Across America” campaign. “Jim and Laura” drove cross-country in an RV and made up stories of alleged interviews of people it met in Wal-Mart parking lots. They published these questionable, and allegedly bogus stories on the “Wal-Marting across America” blog. Business Week exposed the real story behind Jim and Laura when it reported that Wal-Mart's Working Families group were paying Jim and Laura's expenses, and to write their stellar reports on the Wal-Mart blog.
Wal-Mart has hired the best political consultants using money that could have been used to give its 1.38 million American workers a better standard of living. Political Consultants like Michael Deaver former adviser to President Ronald Reagan; Democratic strategist Charles Baker; Jonathan Adashek, a strategist for Jon Kerry; Taylor Gross, who handled President George W. Bush's communications; and controversial Terry Nelson, who was President Bush's 2004 consultant and created an alleged racist political ad in Tennessee.
Last year Wal-Mart created multi-million dollar executive public relations position to its already top-heavy and bloated executive management stable. The company hired Leslie Dach in August paying him an undisclosed salary, but $3 million dollars in stock, and options on 168,805 Wal-Mart shares over the next 5 years. Dach was the vice-chairman of Wal-Mart's now fired PR firm- Edelman when he was hired. Dach was also the former media adviser to President Bill Clinton.
As far as Dach is concerned, despite evidence to the contrary, everything at Wal-Mart is great and 70% of all of American's approve of Wal-Mart.
Consumers are no longer shopping at Wal-Mart because of its reputation regardless of what Dach says.
McKinsey & Company, a consulting firm, completed a study for Wal-Mart that Dach apparently hasn't read, that concludes that 2%-to-8% of Wal-Mart customers have stoppe dshopping there “because of negative press they have heard.”
Wal-Mart has taken some action designed to reverse its image, but those things are too little and don;t really address the problems. For instance Wal-Mart has changed employee uniforms; rolled back prices on their toys and electronics; established a gift registry known as a “wish list; offered $4 generic prescription drugs; and revamped its web site. They have spent millions of dollars in changing advertising agencies, and hired an expensive executive that used to work for Target. But, al of these hollow and disingenuous efforts will not change the bottom line, and obviously don't change the fact that American's are beginning to see Wal-Mart as the greedy corporation it is.
Expansion plans at Wal-Mart have been scaled back in step with their negative growth and probable diminished earnings during one of the busiest times of the year for all retailers.
Chief Financial Office Tom Shoewe told analysts this month that the company will increase its capital spending by only 2%-to-4% in 2007-2008, which is a far cry from the 15%-to-20% spent in 2006-2007.
It's the recognition of Wal-Mart's greed that has resulted in the reversal of its fortunes. While Chief Executive Lee Scott gets his million dollar pay, and executive benefits increases this year, he has forsaken the majority of his hard working employees that have contributed to Wal-Mart's billions in annual profit.
To reverse this decline in fortunes Wal-Mart simply must stop and recognize its 1.38 millions employees with real pay raises, and affordable health care benefits. Wal-Mart's policies governing its employees must be family friendly, and fair.
As Scott and his executive managers enjoy the fruits of hardworking Wal-Mart employees this Holiday season, and offer $4 prescription generic drugs, and increases charitable contributions the American public should understand that these thing are provided at the expense of Wal-Mart's employees who are struggling to provide their families with food, and health care during the Holidays. As more American's see what Wal-Mart greed is all about, and the high costs of their low prices, their voice will be heard, and Wal-Mart will continue the slide down its slippery slope – the reversal of its fortunes.
SOURCES/CONTRIBUTORS: BUSINESS WEEK; WALL-STREET JOURNAL; MARKET WATCH; AP; SEC; www.WalMartFacts.com; www.WalmartWatch.com; www.freewebs.com/WalmartArizonaUnion; www.ArizonaWalMartUnion.blogspot.com
Copyright 2006 Randy L. Harrington. ALL RIGHTS RESERVED.
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