business news in context, analysis with attitude

We got a number of emails responding to Friday’s story about Wal-Mart’s letter to the citizens of California defending its marketing strategies and employment approach.

One MNB user wrote:

I was most struck by the low wages that Wal-Mart is so proud of. In fact, they are so proud to be paying an average wage of just over $10 per hour, that fact headlines their list of facts! I'm not sure, but I believe the proverbial "fry guy" at McDonald's here in MN earns about that same wage. And I am frequently in CA on business, I have seen the price differential in stores between CA and much of the rest of the country. I don't have firm statistics, but my bet is that an average salary of $10 in CA is nothing to write home about!

MNB user Brendan Haslam had a comment and a question:

I agreed with all of your views regarding the press release, more defensive than the kinder, gentler Wal-Mart they’d like us to think they are evolving into. It sounded like compassionate conservatism.

I’m writing because I have more of a question than a comment that stems from this part of the press release:

“Wal-Mart is an integral part of the California economy, purchasing goods and services ranging from agricultural to entertainment, high tech to consumer package goods. Last year, Wal-Mart purchased more than $8 billion in goods and services from 4,600 California suppliers. Much of what California grows and manufactures is distributed to Wal Mart stores across the country and around the world.”

Is this just hype? Does buying from “4,600 California suppliers” mean that it’s buying only ‘made in California’ goods from California owned businesses? Or does this really mean that suppliers are companies that serve like brokers, for all of the ‘Asian-made’ goods that Wal-Mart sells?

It has been tough to get a precise answer to that question, but most of the speculation we’ve heard suggests that Wal-Mart – like many companies – is using the broadest possible definition when it talks about “4,600 California suppliers.”

Another MNB user observed:

Funny how they can seemingly speak half-truths of their own and still lob criticism at those that criticize them on the basis of half-truths. I also would like to know how they define full time employees.

One MNB user and Wal-Mart executive wrote us to explain exactly how the company defines “full time”:

This is the definition of Full Time as written in the company's Associate Handbook.

You are classified Full Time:

if you are classified as full time in the company's payroll system,

If you regularly work 34 hours a week (28 hours a week if classified as full time prior to 1/1/2002, or 20 hours a week prior to 1/1/1979),

If you are a truck driver and you are classified as full time in the company's payroll system).

That's it!

Now, that's not too hard to understand, is it?

I would allow that it may be a little more detailed than other companies, but I've found that to be true in most things Wal-Mart does or tries to do. Not that all are successful, but more are than not.

I believe that any company which becomes as successful as Wal-Mart is going to pick up, along the way, more than their share of nay-sayers, but the really successful companies plow ahead for in the long run customers see that there are more advantages than disadvantage in doing business with them.

No, it’s very easy to understand.

So if you work 34 hours a week and make $11 per hour, you make $374 per week, and, if you work 52 weeks a year, you have a gross annual income of $19,448.

Of course, you have to put that number in context. How much money that is depends on where you live, and how many people need to survive on that salary. It also goes a lot farther if you have health benefits coming from someplace, as well as having to pay for them yourself.

If we read the federal guidelines right, it is below the poverty threshold for a family of five.

Context is everything.

One MNB user objected to our note that not every community shares Wal-Mart’s priorities and objectives:Ever stop your ranting to consider that perhaps opening up stores and seeing how many people choose to shop there would be the best way to determine to what extent “low prices aren’t always everybody’s biggest concern”?

Didn’t think so.

Why is it that whenever we ask questions about Wal-Mart, or suggest that maybe, just maybe, communities have a right to resist the lure of the Bentonville Behemoth, there is a certain constituency that thinks we’re ranting?

Believe it or not, there are a couple of websites out there that have identified MNB as being a Wal-Mart “apologist.”

Go figure.

And another MNB user wrote:

I read so many of your columns about what Wal-Mart does wrong it makes me wonder if you think they ever do anything right. Hmmm.

We think Wal-Mart does a lot of things right. We have described it on numerous occasions as one of the great American success stories. But that said, we also have an inherent suspicion and concern about any institution that gets too big, too ubiquitous, too powerful.

Those kinds of misgivings, by the way, also are very American characteristics. Long before there were red states and blue states, America has been driven by two different impulses. To paint in broad strokes, there were the cowboys who luxuriated in their sense of independence and individuality, and there were the businesses that followed the cowboys and created structure and infrastructure. What makes this country unique is that we’ve always celebrated both impulses as they lived in an uneasy coexistence. And, it seems to us, each impulse actually keeps the other honest.
KC's View: