The Wal-Mart we all know and love
What does a famous pin ball wizard have in common with the planet's largest retailer? An internet version
of the old bar room game has not exactly mastered the cyber world, as it has in the bricks and mortar arena. But why worry
about e-commerce when you have so much of the retail market in your hands? And it’s growing all the time . . .
Second hand cars from a reliable source! Test drive your dream auto, even if a little used. Or how about running down the aisles
to find those midnight snacks, now that food is on the grocery list when shopping at the house that Sam built? But now we
have an announcement that Franklin Bank of California is the next trophy in the bank vault for the giant from Razorback country.
This is a tale that has two sides - love and hate. So maybe a little concert can be gleaned from that opera
known as Tommy. You say WHO is that fellow, and what does that have to do with that old guy that greets us at the door? Well,
Tommy faced a horrible and tragic crime while looking into the mirror. He was told: "you didn't hear it, you didn't see
it, you won't say nothing to no one ever in your life..." The shock of a slaying committed in his own house caused him
to go through life as a "deaf, dumb, and a blind boy." His relatives molested him and savage cousins tortured him.
But when he learned to play pinball - he became a Sensation - the Wizard . . .
As Tommy becomes a famous champion, he still can't bear to look at himself in a mirror. What he sees, seems not to respond
to anything, until the mirror is broken. Now a miraculous transformation takes place and he becomes a real super-star. When
an admirer asks how to be more like him, Tommy tells his fans that they shouldn't be more like him. He is happy that he's
finally like them.--able to hear, talk and see. Enraged and confused by Tommy's answer, his fans abandon him. He
is left alone with his family.
"Anyone who sells anything that we do is a competitor." Wal-Mart CEO David Glass, 5/21/97
On the surface this statement is true and valid. But what does the Wal-Mart philosophy really mean? Just
ask the folks who want to Save their Communities! Their main points are:
1) A dollar spent at a Wal-Mart goes to Bentonville, Arkansas, the corporate HQ. A dollar spent at a local
store gets deposited in a local bank and spent again in the community a couple more times.
2) Wal-mart replaces full-service stores with its self-service model, with a net loss of jobs to the community
- about 1.5 for every Wal-Mart employee.
A previous effort to acquire a banking subsidy was met with resistance from the Independent Community Bankers of America. - "very serious public policy issues involving the mixing of banking and commerce, community reinvestment
and conflicts of interest."
Does this mean that Sam's buildings all have the same address as Uncle Ernie? Well, we said this was a story
with two sides. What we do know is that the Walton family has never been known for being dumb. Sam's heirs leave Bill Gates far behind. But is the reason for their financial success just the "Epitome of Capitalism",
as their detractors contend or are they receiving the eager support of the consumer? When Wal-Mart Supercenters enters the California market is the promise of every day low prices on general merchandise - expanded to
groceries just the greed of a monopolist or is it the marketplace working its best magic?
Sam built a better mouse trap! The beauty and tragedy of business is that universal benefits are not equally
distributed. Efficiency in the market means weak competitors will fail. And that is the way it should be! The real issue is
that concentrated synergism and scale cannot be countered with a competing alternative if access to capital is unavailable.
The hopes of the independent merchant class can never seek to go nose to nose with a hog of the size of Wal-Mart. But that
sow may not be the pig that some want you to believe . . . When buying from American sources and suppliers was the prime pork
on the plate, it was easier to defend a smart retailer that brought real competition to the outdated models of Sears and K-mart.
Today, the juggernaut of a friendly smile and invite to buy foreign, causes pause to the bandwagon of - if it isn't
sold here, you don’t need to buy it!
All bright consumers are devotees of sensible, if not the lowest price. Value goes a long way and Wal-Mart
is certainly the leader if that is the foremost objective. But at what point will the giant consume the alternative, and become
the default employer? Will that worker be able to shop in their own store, or will the Walton family just need to consume
their own products? The lesson of Henry Ford should not be forgotten in this era of buy low, sell lower and get paid by the
Even for people of independent means, Wal-Mart has been a pleasant neighbor and dependable merchant. But when
and where will the linear integration end? Maybe with baked dough, Sam's face on the lettuce, can be issued in the form of
scrip for the company store, through the onsite bank?
Sam was more than a "good old boy". He was as ordinary as one can get in the realm of the rarefied air
of the billionaire class. Can we say the same for the current crop of management? Maybe they need to listen to Roger Daltrey
when he sings Tommy . . . Hearing himself saying "See me, feel me, touch me, heal me." Sam knew he realized
that he finally has what he's always wanted - to be normal. Can we say the same for the officers in their new bank?
SARTRE - May 18, 2002