CEO: Wal-Mart Faces 'Challenging' Environment

CEO: Wal-Mart Faces 'Challenging' Environment

CEO Worries About Economy, Customer Base

POSTED: 1:53 pm EDT September 8, 2004
UPDATED: 1:57 pm EDT September 8, 2004

NEW YORK -- The head of Wal-Mart said Wednesday that the current business environment is "challenging" because customers are being affected by rising energy costs and discouraged by geopolitical events and the negative political tone in the United States.

Chief Executive Officer Lee Scott told the annual Goldman Sachs' Global Retailing Conference that Wal-Mart's core customer base is affected in particular by these issues because they're economically challenged.

For instance, he said about 20 percent of Wal-Mart customers don't have a checking account and live paycheck to paycheck.

He noted that customers of the company's Sam's Club unit, who are better off economically, are affected far less.

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http://www.thekcrachannel.com/money/3714908/detail.html

Squeals for its supper.

:D

by raising their salaries and giving them benefits.

At the cold, hard world Wal-Mart has to face. )-:

NOT!

:nopity:

To shop at Their stores?
Sounds like they are cutting their own throats.

This is called blowback. Walmart has been a leader among corporations who force Americans to compete with third world nations for a job, hence slave labor. Now they cry that their low-income customer base can't afford to buy their stuff. Well duh!

His corporation leads the pack in the pursuit of cheap labor whether it means moving manufacturing jobs overseas or paying store employees wages that qualify them for public assistance while working full time. And then he *wonders* why people have no money to buy his crap made by women, men and children working in overseas sweatshops.

Walmart exec sees finish line in race to the bottom.

tell him the pro-business "prez" needs to be booted out and the U.S. Chamber of Commerce needs to get out of politics.

are forced to shop at Wal-Mart because of the cheapest prices around. When they can't afford Wallie's, then what the hell can they afford. Nothing. The people in this country are getting so f---ked over it isn't funny. Walmart is so damned predatory, I will never feel sorry for them, they always try to drive other retailers out of business.

If you think WAL-MARTS shit is cheap you should check out these places. It reminds me of the lowest end ---third world stuff.

Almist Medieval.

and one just showed up at the local indoor mall for the first time ever. It is always crowded. I really think this is all a lot of people can afford. Yeah, they are cheaper than WalMart. It is sort of a sad commentary on what the average American consumer can buy after they buy food.

In their quest to continue to get the lowest prices, they force their various suppliers to give them merchandice at a lower cost. Now why would a manufacturer want to do that? Because Wal-mart is the largest retailer in the country. Loosing a Wal-mart account is a huge loss to the supplier.
So what happens is this: Wal-mart tells their suppliers to lower their cost, the supplier lowers the cost at the expence of having to cut its staff in order lower their overhead and thusly sell their items to Wal-mart at that lower cost.
See, wal-mart is like a fucking virus. Not only do the kill the local business person but they also kill the suppliers. This kind of business practice can be halted. But that same supplier must be the ones to take the stand. Will they? Doubtful. Most of these suppliers started off small, grew with the Wal-mart account, had a huge overhead, then take the hit when Wal-mart reads them the facts of life. So in essence, Wal-mart has them by the balls.

need to come to understand. There are NO externalities in business. Everything you do can come back to bite you in the arse in the end.

you know how cashiers at the grocery stores are being replaced by self scanners. Where in hell are those people supposed to get their next jobs? I have totally refused to use those things because I know they are getting rid of WORKERS, their jobs, their salaries, their way to feed themselves, etc. When unemployed people look for a job they will go to groceries to fill in for the regulars and now even that will be taken away. Even though they don't pay well those jobs can put food on the table.

Many of Walmart's suppliers contract with overseas manufacturers simply to be able to meet Walmart's pricing and service requirements. (Apparently, doing business in the low-wage countries is no picnic.) Their biggest fear is that Walmart will dump the suppliers and deal directly with the overseas manufacturers, who have now been trained (on the suppliers' nickels) to make goods for Walmart.

that's wallie's plus they pay their workers dirt and shit on 'em in all other ways. How many lawsuits are there around the country because of short-paying the people for overtime, etc.

Here's an idea, Mr. Scott: Why don't you try working for a living?

and close down operations in the USA. I would never shop in one of those shit places.

...and live paycheck to paycheck." ???

DOH.

Hmm, not enough people buying your crap, even with WIC and food stamp information stuffed into each new employee training kit to help hold down employee costs?

Sales figures not as rosy as you'd like them to be, even as your buyers circle the drain of ever lower prices in China, India and Bangladesh?

Can't get the low prices you need from suppliers, even as they offshore just as quickly as their little legs can carry them?

Things not going according to plan as the economic "recovery" fails to lift the boats of the bottom 20% of your customer base - you know, the ones who don't have checking accounts?

Better SUCK IT UP, big boy. You shit in this nest - now settle back, relax and wallow in it.

does he want a govt bailout, a la the airlines? does he want us to feel sorry for him and shop there? does he want free license from the govt to screw his employees and contractors further?

what's his point?

i quit shopping at wal-mart a while back when i read that they do more business with china (a despicable piece of shit government) than england and france combined. that's not helping u.s. workers or the u.s. trade deficit.

Wal-Mart deserves whatever they get. The company has dictated to vendors for years and have probably squeezed all they can get out of most suppliers.

How many US manufacturers have suffered at the hands of Wal-Mart as they went offshore to get cheaper goods?

I'm in North Jersey and have had a few Wal-Marts open over the past few years. Another Superstore (or whatever they call them) is now under construction. The retail environment here is already saturated.

then maybe I'll shop Mal-Wart again.

First, it is strong evidence that Bush's economic policies and foreign policy are both hurting the middle and lower income groups.

It is also evidence that the economy is NOT improving.

And it is evidence that Bush's economy is NOT GOOD FOR BUSINESS.

And that is all good, because it is a bigger message than words. It is tangible evidence that Bush is a failure on every level, and no words or spin or media bias can hide from someone the fact that he can't even afford to shop in walmart anymore.

And it won't hide from the wealthy investor the fact that his investments in walmart are going down in value.

When you piss off both the rich and the poor, your days in power are numbered.

I had to contact Mr Scott about the story. Submitted for your approval and comment is my response. ( I haven't sent it yet so I can make changes based on your input)

Mr. Scott,


I read the news story about your concerns for the economy and your customer base with some interest. I too share your concern but see the world from a different perspective than most business leaders. I am nothing more than an average working class sort who decided to take time away from work because of my dissatisfaction with the current business environment. I cannot and will not ever again work for a company that considers labor a liability as opposed to an asset. I also only purchase from companies who don't recognise the value of their employees when no other alternative is available.
While Wal-Mart has gained a reputation for providing lower cost, it has done so to its own detriment and not without harm to the communities it affects. Your comment about poeple living paycheck to paycheck indicates the basic flaw of viewing labor as a liability. It is an unsustainable business model. When the lowest paid employee cannot do any more that sustain themselves with their income they don't provide much of a market for your merchandise. Every supplier that you manipulate to reduce their per unit price by whatever means reduces your potential market. In the simplest terms, the more people that can earn a living wage through their labor the larger the market for companies such as yours.
While you may have learned more than me at Pittsburgh State and Columbia, I found that learning is a dialy exercise. I hope my comments provide some useful fodder for better opportunities for all of us.

Sincerely,

J.G. Hails

sorry, can't wait had to send the message

Let us know if you get a response.

...all those people living on min wage (or less) - those illegal immigrants who will soon be getting our Social Security - are Wal-Mart's best customers and Wal-Mart employs lots of working poor. It suffers what it begets. It's a viscious circle.

Wal-Mart is part of the damned problem, so I have real trouble dredging up any sympathy for the corprat behemoth.

To HELL with Wal-Mart.

Walmart is only a symptom of the problem. They're pretty much playing by the rules though, worker rights abuses such as locking employees in the store after hours aside. Even then that only happens because they operate in an environment where they think they can get away with it, and if they don't, well, what the hey? They just say, "We'll get slapped on the wrist with a fine that is a miniscule portion of our profits and then continue doing business as normal." Like Microsoft and antitrust lawsuits they see it as simply a cost of doing business where the benefits in cost (payroll) savings outweighs the potential costs of fines and lawsuits.

The real problem lies in that in this country for the past twenty years we have encouraged an economy straight out of some Dikensian morality tale, except this time around the predatory rich don't even have the insufficient restraints of noblesse oblige holding them back. It is truly a race to the bottom.

just ask folks who have had their communities, even towns, destroyed by a Walmart.

Walmart invaded my area big time a few years back when they built one of their massive warehouses one town over. I know full well what effect Walmart has on an area.

I was just trying to point out the problem is bigger than Walmart.