business news in context, analysis with attitude

We got a number of emails regarding yesterday's story about a piece in The New York Times about a new labor controversy for Wal-Mart, this one about its past policy of keeping overnight workers locked inside its stores. The policy supposedly was to keep the store and employees safe in dicey neighborhoods, though some employees questioned the motivation. The larger concern seemed to be about a policy that kept people from leaving the store except in case of fire, which created some safety questions in other circumstances.

MNB user David J. Livingston wrote:

Wal-Mart just gets the bad press because they are big and they are good at what they do. If I'm locked inside a Wal-Mart at 3 am and need an ambulance -- well I'm going out the emergency door. So what if you loose your $6 an hour job? Big loss?

We suppose it is a big loss for people who may not have a lot of other options.

MNB user Tim Yount chimed in:

I've been in this retail working world for 30 years, now, so I feel qualified to speak on the latest round of Wal-Mart news. I feel what we are seeing out there in Bentonville reaction to all the incidents reported, is a classic picture of "practice" versus "policy".

No good retail corporation, in their right mind, is going to tell their managers to lock people in their workplace. That would be shades of slavery or imprisonment (to be harsh). However, and I've witnessed this many times in my retail operational career, there may be the spoken word, from higher authorities, that "inform" local management of "practices" to get things done in an efficient manner. These "practices" will never find their way into print, because they are "suggestions". Enterprising store management may adopt them to be the corporate will, but they have been cleverly disguised as mere suggestions for a better way of doing things.

Kevin, whether in grocery store operations or in general merchandise operations, these things happen all the time. It certainly doesn't make them right, and it gives a corporate entity the status of "plausible deniability".

Does that happen in Wal-Mart culture? I believe we've seen enough to know that there is something going on. Does it come from the core of Wal-Mart's cultural soul? Maybe not in writing, but the mantra of "low cost operator" may have a life of its own within the operating practices that emanate from Bentonville. Nothing in writing, of course.


We're not sure what is really known about Wal-Mart's soul. There's anecdotal evidence and a lot of different perspectives. But the soul can be a difficult thing to read.

And another member of the MNB community wrote:

I cannot understand, for the life of me, why anyone would think that after a store closes for the day it should remain with unlocked doors. There are smoking areas in the store; there are fire doors all over the store that open at a touch; what else does one need?

While it may take a few minutes to answer a phone, although there was someone whose duty was to do that on the night crew where I worked; it won't be on the first, fifth, or even maybe, the 20th ring. But, in my experience, it will be answered. Someone is always curious enough to find out who's calling at 3 am; even thou 99% of the messages are "Are you open?".

If anyone had to wait an hour for a manager to come on an accident scene, either there was no urgency in the message paging them or, again, they were one of the rogue managers who got caught out of the store after sneaking out for a smoke or cup of coffee and "hot KK" at the nearby Krispy Kreme. Neither explanation makes any more sense than the NYT again blowing ordinary happenings out of proportion. I can't recall anything like this being reported in the past 10 years I've been at Wal-Mart.

As for those assistant managers claiming Wal-Mart "forced them to do work that was decidedly non-managerial", that's in their view. Those associates working for these three might be heard saying that they were only doing the type work they were capable of doing. There's a few in every store that fail to measure up to the job they are put into. But that's not hardly new anywhere.

I dare say that IMO this article measures up to last week's as being as meaningless as it seamed to be. I've sort of grown used to this from the NYT.


Maybe. But we're not rejecting all the negative news coverage just because it’s the news and just because it's negative…even though that seems like what Wal-Mart would like us to do.




We got the following email about the Southern California grocery strike:

One of your posters wrote:

"As a woman, I cannot help but wonder where people are shopping and what is happening to the bottom line at those stores."

Here in the San Gabriel Valley we are so saturated with supermarkets, you're never more than a mile away from one. So if you don't feel like confronting the familiar faces of the picketers at your local Vons, drive a couple of blocks to Albertsons or Ralphs, or Stater Bros, or Costco, or... you get the idea. Personally, the strike has motivated me to do more shopping at Superior Grocery Warehouse (1.3 miles away) instead of Vons (2 blocks from home, and another 1 block from work) since the prices are better and the meat is less suspect than the stuff that's being trucked in to the big 3.

I have asked a number Vons strikers and a couple of UFCW reps what the continually empty parking lots indicated. They all said it meant customers were supporting the strike. I tried to point out that people did not seem to be going hungry, and I had yet to hear of any food riots breaking out, so maybe competition is as fierce as the big 3 have stated. I cited as an example that Superior Grocery has 21 (twenty-one!) registers open on Saturday mornings, and they are for the most part selling the same items as the as the big 3 (i.e., non-bulk sizes) at lower cost. You want to know what the UFCW guys told me? They had never been there! Talk about willful ignorance.

As to the bottom line - Vons and Albertsons are ghost towns. Ralphs, due to the absence of pickets, are substantially busier.

Regarding the comment:

"Isn't it interesting that the small, innovative supermarket chains don't seem to have labor problems, while the large, centralized chains do?"

Trader Joe's, Superior, and Sam's Club are non-union, so that helps a bunch with the labor issues. Stater Bros. and Gelsons purchased their labor tranquility by choosing the appeasement route with the union (they promised to accept whatever terms the UFCW and big 3 agreed to in exchange for not being struck). Seems the "innovation" consists of either not having a union, or paying protection money.





Regarding the dispute between the Bush administration and the World Health Organization (WHO) about proposed obesity guidelines, MNB user Ward Eames wrote:

I think the US Government is right in one respect. There is no "good" or "bad" food. There is "every day" and "Once in a while" food.

Good point, and well-put.

MNB user Cathy Watkins wrote:

Are you kidding me? You certainly can think that there are clear and accepted standards of what is junk food and what is good food! There are various forms of recommendations floating around, however as soon as science determines something, a year or two later another study finds it false...think eggs!




More comment regarding Kash n' Karry CEO Shelley Broader, who we keep hearing and saying good things about:

No question your remarks concerning Broader are right on. I've known Shelley for a number of years and she has yet to reach her potential, even in this current role. It's been fun to watch and she's only at the beginning of her curve.




Regarding Kmart's continued closing of stores, MNB user John Tingley wrote:

Closing a store here and there is not a problem what Kmart needs to do is find new ways. Distribution is the key stores that can be service by the Distribution Network is key. Maybe Kmart can franchise stores in under stored areas. One other area that Kmart should try is going back to the old 5 & dime. For Years Kmart had deep discount stores ( Jupiter ) when the Kresge stores no longer work.

Maybe besides up grading current stores ( please either get in or out of electronics') opening small discount $$$ store's where they have excess distribution.

Kmart started and was most successful when it was a store with several different companies involved.


And another MNB user wrote:

More Wal-Mart Supercenters are opening in Saginaw and the Kmart in Michigan was a weak performer. The scary thing is Wal-Mart is targeting some of Kmart's best performing units for opening new stores. I would not be surprised to see Kmart close 200 stores a year until they run out of stores to close. The very best Kmart does about the same volume as the average Wal-Mart. And those numbers are dropping fast, according to Kmart.



The subject of information control, as proposed by the White House Office of Management and Budget (OMB), prompted several emails. One MNB user wrote:

Honestly, I think this entire ordeal has become a podium for Bush and his office constituents because of the election year. Many MNB readers have stated, with great accuracy I might add, that this emergency control given to the White House not only threatens the democracy of the country but in the same breath almost violates the Constitution.

One reader had written that if this bill were to pass that it would take too long for the information to go through the pipeline and the public would be left dumb for what could possibly a dangerous amount of time. I realize that is an extreme, but this idea and what has now happed with the declared "Emergency State" is more extreme. The way this country was founded was not in a way that gave one governing body all the power. This bill does that and words like Aristocracy and Dictatorship come to mind.

Information is freedom, and so is speech. How would we be able to get all of our good information from MNB if the pipeline of info is cut off.


Well, we'll find a way…

And MNB user Denise Remark wrote:

For all of the readers who responded negatively to this article (& frankly, only an idiot could see any possible good in this thinly-veiled attempt at information control), please suggest that they contact their legislators & tell them how asinine this idea is--I am going to do exactly that! This is an example of how readers send you their comments but should go the extra mile & tell their elected officials how they feel!




And thanks for the following note, which we received yesterday from a member of the MNB community:

I read your newsletter first thing --having been in the industry on the sell side for 30 years.

Your reprint of Dr. King's speech SHOULD have an impact on every American -- but not just for the reasons most might think. Dr. King believed in freedom, not preferential treatment, in equality, not creation of special classes of people (and businesses)through legislation to milk unfair advantage of the rest of the group. Dr. King valued morality and fairness, not corruption and lies (see the endless lies coming from Greg Conger's mouth regarding the So Ca grocery strike...). Dr King dreamed of equality, but equality of individuals, not equality of wealth or the socialistic leveling of every playing field on every plane across society in the US.

Maybe...just maybe...each reader should take another look at the words in the speech --and then take a moment of introspection to see how misled each of us has been by our government, our society thought leaders, and even our capitalists. It's not too late for us to awaken and make changes the way Dr. King would advocate them being made --at the polls, through economic and non violent protest, through taking a stand when that stand might alienate one from a friend or associate. Maybe everyone should read every word just one more time.
KC's View: