Wal-Mart Recalls 56,000 Toys

KamCity

By John Hughes
and Jonathan D. Salant
Bloomberg

Inside the Retail Giant

By Angie Eros
Associated Content                    [back to top]

What is Wal-Mart? Wal-Mart is the happy face that we all see every time we go into pick up the common items, like milk and bread; never did it occur to us that the things that we so thoughtlessly set out of place on a distant shelf, or the few cans of tomato soup that we might dishevel along the way, may make a workers night just a little bit longer, stretching the already microscopically thin work force just a little thinner. As the giant struggles to keep it's standing in the world, it adapts and makes cuts to benefit it falling profits. How big can Wal-Mart get? With annual sales topping out in the billons, they continue to grow, but at what cost? Profit seems to be the only force that has enabled this retail giant to take over the market, as we know it; gone are the days of quality, when a television would last for twenty or more years, when a refrigerator or electric stove bought at the beginning of a marriage would last past retirement. Blame it on China or Taiwan if one must, but it is Wal-Mart that wants it faster and cheaper; if it is made out of metal, make it out of plastic; if it requires cutting a step or two in quality control, or even safety, anything to keep the numbers that Wal-Mart is so obsessed with from dropping and the profits high.

Things are also changing on the inside of this super power; not only is it becoming more and more difficult for workers to get their jobs completed by the end of their shift, due to labor cuts and cross training in five or more departments at one time, but also a cyclone of new policies created to suite the company and not the families that depend on it for their livelihood. Tough it out for years and see where it gets you; a piece of paper telling you what a good worker you have been to the company, a good job pin to add to the other junk trinkets of appreciation collected over the years. But will anyone care when your body is broken from all the years of lifting and moving things by yourself, because the labor budget was more important than providing adequate staffing? Maybe a "Get Well" card in layaway and then all at once, you're forgotten. Then the long road of finding out that the health insurance you worked so hard to pay for throughout the years is just as worthless as the pep rallies management gives each and every day at their store meetings; the list goes on and on.

Wal-Mart has made the money, slain and beat down the mom and pop stores of yesterday leaving nothing left but themselves, changing their tide of retail from the low price leader, to the leader of high prices and low quality, both in the products they sell as well as the life and environment they provide for their workers. Wal-mart is telling its once family oriented philosophy good-bye and it employees make the choice. Family is no longer an option for wal-mart and they don't care if you have been there forever, they come first. There attendance policy doesn't even excuse you if you in the emergency room dying. Show up or risk your job and that is the end of it. A tornado could wipe out your house and you would still have to show up if it didn't affect more than three fourths of the county. Management is trained to handle each situation as if they could easily replace you. Sure they could, for less and still get by or maybe they just want to lower the number of paid employees all together to get the numbers up. That is the situation in most of their store. Work with what you have and enslave those already their. If you can run your store on a skeleton crew do it and don't worry about whom gets sick and tired have being your workhorse. They customers will understand and they profits will soar. So the next time you knock over a can of beanie weenies or a bottle of motor oil, make it neat, you never know who job you'll make easier.

2007 © Associated Content

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German retailer to reflag Wal-Mart shops

The Associated Press
December 29, 2006                          [back to top]

German retailer Metro AG's Real division said Friday it would reflag 80 percent of Wal-Mart Store Inc.'s former stores in Germany under its own name and close 15 of them by mid-2007.

Metro bought Wal-Mart's German stores earlier this year, and has already renamed six of them as Real markets. Real said in a statement that it would also close the former Wal-Mart headquarters in Wuppertal by the third quarter of 2007.

"The Real marketing network will be strengthened for the long-term through taking over of most of the Wal-Mart branches," the statement read.

"These locations are an outstanding geographical and strategic fit for Real and will provide a clear improvement of the company's position on the German market."

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The WalMart Rule

Bruce Fleming
December 29, 2006                  [back to top]

In 2005 and 2006, one of the most-used political slogans in Washington involved the so-called "Pottery Barn rule," after the popular retailer. It had nothing to do with homewares, however. The rule was this: "You break it, you own it"-it was thrown as a reproach against the administration that invaded Iraq. (Little matter that spokespeople for Pottery Barn protested that this in fact was not their rule.) For the New Year, I propose another rule, which I call the Wal-Mart Rule. It comes from Wal-Mart's disastrous experiences in Germany, where they've recently gone bankrupt. The rule is this: In foreign perception of the US, the perceiver, like the customer, is king.

In 2006, Wal-Mart, that seemingly unstoppable juggernaut of low-price retailing that the left loves to hate and the right sees as the proof that capitalism works, pulled out of the world's third-largest economy, Germany. Wal-Mart, the formerly invincible, went bankrupt, belly-up, pleite (as we say in German). Many reasons were given: the loyalty to "corporate identity" demanded of workers, a concept strange to some Germans; the fact that the Wal-Mart director for Germany didn't even speak German; the fact that in our so-PC times the store forbad "flirting" among workers, a prohibition many Europeans think is merely puritanical and dumb; the fact that workers were required to smile at and greet shoppers (Germans think something is brewing if people are too friendly); and the fact that Wal-Mart's big-box stores are simply too unlike the little mom-and-pop stores, called "Aunt Emma Shops" in Germany, that have defined retailing there for generations. Some economic commentators mentioned President Bush's unloved Iraq War, and even more general anti-American sentiments in the German populace.

Whatever the reasons, the result was huge losses for Wal-Mart, and ultimately a pullout. Of course, we say. If they don't like you in retailing, you simply pack up and leave, if you have a place to leave to. You don't stay around and rail at those stupid customers for not loving you more. You, the retailer, have proposed; the customer has disposed. And that's all there is to it. If people don't want what you're selling, you can't sell it, because they won't buy it. They don't even have to give a justification for not buying it. They just don't buy it. It's capitalism, buddy. Suck it up.

I propose the "Wal-Mart rule" as a warning to Washington politicos. Thus: it doesn't do any good to rail at people who don't want to buy what you're selling. If they're not buying it, you either change your tune, or you pack up and go home. The customer is king. Even in terms of world opinion.

Just now, as every opinion poll shows, the US's public standing in the rest of the world has fallen to new lows. We can certainly debate why that is so, but it's clear that the (wo)man on the street outside the U.S. is simply not buying what the crowd in Washington is selling. And it doesn't do a bit of good for the inside-the-Beltway folks to excoriate all the foreign customers streaming out the door. They've voted with their feet: it's up to the US to do something about it if we want a presence there at all. Since "there" is anywhere else in the world but here, it would behoove us to figure out what went wrong and rectify it -- not turn the air blue about how dumb those damn furriners are to doubt us.

Still, many people will. Turn the air blue, that is. Dadgummit! We're not anti-democratic, even if we suspend habeas corpus, don't-call-it-torture interrogate, keep people in legal limbo if the president designates them "enemy combatants," and listen to phone calls-the whole lot. That's the price we pay to stave off another 9/ll; only lily-livered liberals get upset about cops playing hardball right back.

In purely rational terms, it's surely true that the current administration's infractions of civil liberties are miniscule. But the fact is, they loom large to the rest of the world. That's got to be our point of departure.

The fact is, none of these measures really seem to be getting anywhere near the people who brought us 9/11, any more than the invasion of Iraq got us al-Qaeda. Foreigners aren't dumb, even if they're not American. They noticed things like this, and pointed them out. At which point the current administration became apoplectic.

But the Wal-Mart rule tells us people don't even have to have a good reason for disliking what America does. If they do, they do, and it's up to us to do something about that. The customer is king, even if what we're selling is a view of ourselves.

America's standing in the world is currently low indeed-justly or unjustly. (For the record: I think it's unjust, but I understand why it's so.) A friend of mine, a Berliner with longtime U.S. ties, teaches English and American culture at a school in Berlin. She tells me that her efforts to make the point that the U.S. is a positive force in world affairs are now in vain. No one will listen to her. The students roll their eyes and disagree when she speaks of "American democracy," which they now hold to be an oxymoron.

Of course she, I, and my readers here know they're simply ungrateful. Her students are the new generation of a city that the U.S. kept alive through the Luftbruecke and protected for years from the U.S.S.R. with our troops. So yes, we can feel self-righteous and whine. Or we can take onboard the fact that even these people, our allies, don't like us, and address the reasons why.

In terms of perception, as in retailing, the customer is king.

Let's all hope for a better 2007.

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Goodwill shops locating near Wal-Mart

The Associated Press
December 29, 2006                 [back to top]

Seeking to tap into Wal-Mart's big customer base, Goodwill Industries in northeast Ohio is moving some of its thrift stores closer to the big-box retailer.

"We share the same demographic," said Marisa Rohn, vice president of marketing and fund development at Goodwill Industries of Greater Cleveland and East Central Ohio. "We've found when we locate near a Wal-Mart, we're less of a destination shop and more of a mainstream shop."

Earlier this month, Goodwill shut down a location in Massillon and is relocating it to a shopping plaza in the city that has a Wal-Mart as the anchor store.

Goodwill also plans to close its flagship shop in downtown Canton and move it to nearby Perry Township -- a few feet away from a Wal-Mart.

The branch has built stores recently in New Philadelphia and another in Canton close to Wal-Mart locations. The New Philadelphia store had $1 million in sales in its first 10 months, Rohn said.

"The dollar and cents are important, but more than that, the more we can make and generate, the more missions we can plow," Rohn said.

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Metro says to keep 70 Wal-Mart stores open

Reuters
Fri Dec 29, 2006                             [back to top]

FRANKFURT, Dec 29 (Reuters) - Metro AG <MEOG.DE> said on Friday it plans to keep open 70 of the 85 Wal-Mart <WMT.N> hypermarkets it bought earlier this year in Germany.

Metro, based in Duesseldorf, said that the Wal-Mart hypermarkets would be converted to its Real brand stores before the middle of next year.

Fifteen stores would be shut, Metro said.

Metro bought Wal-Mart's stores in Germany in late July. Metro said then that Wal-Mart, whose operations in Germany were struggling, was keen to sell and Metro bought the stores at a bargain price.

© Reuters 2007. All rights reserved.

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Wal-Mart stays open for search

Mitchell store doesn't close despite pre-holiday threat

By MELANIE BRANDERT
Sioux Falls Argus Leader                      [back to top]

Last Saturday afternoon, Eva Voorhees heard the clatter of feet on the roof of the Wal-Mart Supercenter in Mitchell where she works in the photo department - but it wasn't the pitter-patter of reindeer.

It was the police looking for a bomb. Up front, police officers, the SWAT team and others were busy searching the store next to customers who were browsing for gifts. The police looked in jewelry counters, wrapping paper rolls, freezers, the back room where trucks unload and closets at Tire Lube Express.

During the nearly two-hour search, Wal-Mart officials opted not to evacuate the busy discount store even though police recommended they do so. Wal-Mart officials said the call was a hoax and not a threat.

The incident has family members of Wal-Mart employees criticizing store officials for failing to take the threat seriously.

Voorhees has worked at the Mitchell discount chain for about four years. Her daughter, Charlotte Goode, 36, said Voorhees called her Sunday, crying and upset as she relayed the story.

"It's right before Christmas. They were swamped with people," she said. "To me, they endangered the community, customers and associates. They put making a buck ahead of public safety."

On Saturday, the Mitchell store - like many retailers nationwide - was filled with customers making last-minute holiday purchases. The store had at least $400,000 in sales at stake.

When Elida Antaya of Plankinton shopped at the store about 9 a.m., she said it was full of customers.

The store received a call at 2:10 p.m. from a male who said a bomb was there. Lyndon Overweg, Mitchell public safety chief, said the caller did not go into specific details.

The SWAT team was dispatched, along with many officers to help clear out the store.

Overweg said police recommended the store be evacuated to allow SWAT team and other officers to search the building. But Wal-Mart opted not to, he said.

"We look at it from a public safety standpoint," Overweg said. "How they approach their issue, you'll have to talk to them."

Wal-Mart District Manager Steve Hanselman in Sioux Falls said Wednesday night that Wal-Mart would never put its customers or employees' safety at risk. He said the decision to keep the store open was not based on Saturday's six-figure sales number.

"What is most important to our associates is their safety," he said. "Myself, Wal-Mart and city officials came to the decision that it was a hoax."

Hanselman deferred further comment to corporate media relations.

Wal-Mart spokeswoman Marisa Bluestone said Tuesday the threat was nonspecific.

"The safety and security of customers is always a top priority," she said. "We work closely with law enforcement to determine if there's a threat to customers and associates. We make evacuation decisions based on discussions with law enforcement."

Bluestone could not say how Wal-Mart officials made the decision not to evacuate.

"It was a decision made by the management team and local authorities," she said.

Despite Wal-Mart's decision, Overweg said police had a mission to search the store.

Mitchell police does not have a bomb-detecting dog, so officers scoured the store's interior and exterior, Overweg said. Off-duty and animal control officers were used in the search that took 11/4 to two hours.

"Had we found any device, everything would have been cleared out," he said. "But no items or anything were found."

Antaya, whose two daughters work there and are mothers of four children, did not hear of the incident until Saturday night at a Mitchell restaurant. She was stunned to hear the store wasn't cleared out.

"That struck me wrong right away," she said. "I said, 'Is the mighty buck better than people?' How can they put money over people's lives? You just don't do that."

She began to think about the prospect of those four kids, ages 5 to 11, being without their mothers.

When Antaya's daughter, Auranette, 28, returned home to Plankinton, she gave her daughter a big hug. She said one of her daughters asked a supervisor what was going on, and they were told, "Oh, we can't say."

"She was pretty shaken up herself," Antaya said of Auranette.

Wal-Mart employees did not receive formal news of the threat until a Sunday morning meeting. Voorhees said manager Ron Warner told workers a bomb threat occurred. When asked, he said Hanselman and the loss prevention division at company headquarters in Bentonville, Ark., chose not to evacuate.

Attempts to reach Warner were unsuccessful Wednesday.

Voorhees called Overweg and Hanselman and told Gov. Mike Rounds' office that public safety was not preserved in the incident. According to Voorhees, Hanselman said it was a prank and said, "Do you know what it would do to Wal-Mart's business?"

When asked what policy Wal-Mart had in determining when to evacuate the store in the case of a threat, Bluestone repeated that the company works closely with law enforcement to determine if a threat exists to customers.

She would not give a reply on whether the company would have evacuated workers and customers if the threat had been a direct one but said it works with law enforcement.

Voorhees said that Wal-Mart employees have codes on the back of their name plates. Blue is for a bomb threat.

"As far as sending panic through the store, they could have said a code blue and employees would know," she said. "I have never been trained what to do with a bomb threat."

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Wal-Mart waits, yet AmCan makes upgrades

By KERANA TODOROV
Register 
Wednesday, December 27, 2006                       [back to top]

The battle over American Canyon’s proposed Wal-Mart Supercenter is expected to return to Napa County Superior Court in the new year, where city officials, developers and opponents of the center will hammer out the next legal steps.

But while they await court action, city officials have been getting updated directives from the appeals court that ordered a halt to construction of the superstore in November. The First District Court of Appeal ruled early this month that the city had violated a state environmental law and city policies in approving the store, and had temporarily banned any further construction work.

Subsequently, the court has partially lifted the ban, but only to allow repairs on Napa Junction Road both east and west of Highway 29 , as the city had requested. In its Dec. 15 order, the court also agreed that some water and sewer maintenance and repairs could be done.

In its unanimous November opinion, the court found the city violated the California Environmental Quality Act when it approved the Wal-Mart Supercenter — a discount retail center and grocery store. The court found that the city’s traffic analysis was flawed and that the city should have taken into consideration the effect Wal-Mart will have on neighboring Vallejo.

On Dec. 18, the court made a move that will have no effect in American Canyon, but could cast a shadow on other big box projects within the jurisdiction of the First District Court of Appeal, which stretches from the San Francisco Bay Area to the Oregon border.

At the request of the citizen’s groups that sued American Canyon, the court agreed that part of its opinion in the case would be deemed published — meaning it has precedential value in other litigation.

American Canyon City Attorney Bill Ross said parts of the ruling “became precedent. The court found the Supercenter is a specific type of commercial (land) use even though it is not defined in the city’s ordinance.”

On Thursday, the city hired a consultant, Michael Brandman and Associates, for $117,700 to prepare a new study for the project.

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The Year in Review: Wal-Mart worries

The Associated Press
December 27, 2006                 [back to top]

BW Exclusives Tech Hot Growth 50 Reports: Consumer Cheer, Factory Humbug Legal Costs Hit Qualcomm's Bottom Line Research In Motion's Record Year Most Memorable Ads of 2006 Story Tools order a reprint digg this save to del.icio.us NEW YORK

Wal-Mart Stores Inc., the world's biggest retailer, saw shares edge down nearly 2 percent during the year as the company worked on improving same-store sales and struggled to bolster its image with consumers.

The Bentonville, Ark.-based company is attempting to attract different types of consumers. On one hand, it seeks to attract more upscale customers, as rival Target Corp. has. To do that, it opened a superstore in Plano, Texas, featuring a sushi bar, wine section and a fall clothing line with trendy items such as skinny jeans.

Still, Wal-Mart continues to appeal to discount hunters, and the company instituted an aggressive discount campaign on prices for toys, consumer electronics and small appliances during the holiday season.

But same-store sales figures continued to sag.

In October, Wal-Mart said it would sharply reduce its rate of domestic expansion, in an effort to restore sales and profit growth in the U.S., its biggest market.

But in November, just before the crucial holiday sales season began, the company warned of a sales decline for the first time in 10 years and said same-store sales growth would be no better than 1 percent. In fact, it fell 0.1 percent. Wal-Mart expects December same-store sales to be flat to no more than 1 percent higher than last year.

The company suffered an internal marketing crisis late in the year, as Julie Roehm, senior vice president of marketing communications, left in December after less than a year on the job, and the company dropped its new ad agency -- Interpublic Group of Cos.' DraftFCB.

Wal-Mart expects to name a new ad agency by the beginning of January.

Its share price fell about 1.5 percent during the year, hitting a 52-week low of $42.31 on July 18, reaching a 52-week high of $52.15 on Oct. 23, and falling since then to close on Dec. 26 at $46.11.

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India's Bharti to invest 7.0 billion dollars in deal with Wal-Mart

NEW DELHI (AFP)
12-27-2006                              [back to top]

India's Bharti Enterprises, which tied up with Wal-Mart to start a nationwide chain of retail stores, said it will invest about 7.0 billion dollars in the project by 2010, according to a report.

The group, which owns the country's top private phone firm, said it will set up 200 large stores and hundreds of smaller ones to cater to the increasingly affluent Indian middle class, estimated to be made up of 300 million people.

"Depending on what we do in real estate and logistics, we will invest around seven billion dollars by 2010," Sunil Mittal, chairman of the group, told the Business Standard newspaper.

Mittal told the newspaper that the group's realty company will identify property for the venture, from which he expected to earn one to two billion dollars in the same period.

Last month the group tied up with Wal-Mart, the world's largest retailer, to open stores that would be owned by Bharti and run under a Wal-Mart franchise.

India does not allow foreign investment in retail except for single-brand stores such as Nokia or Nike.

Other foreign groups such as Wal-Mart have to sign franchise deals with local companies to enter the Indian market.

The newspaper report said that the front-end stores would bear the Bharti name, but talks were on to include the Wal-Mart brand as well.

Organised retailing makes up only three to five percent of India's retail business, with the rest dominated by nearly 15 million traditional mom-and-pop stores.

Earlier this year, India's biggest private firm Reliance started opening a chain of supermarkets as part of a multi-billion-dollar retail rollout. The company said it aims to have 4,000 stores by 2011, with an annual sales target of 25 billion dollars.

Other major Indian business houses such as the Tata group and the Aditya Birla Group are also moving into the sector, which has annual turnover of about 300 billion dollars.

That figure is expected to double by 2015, according to consultants PriceWaterhouseCoopers.

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Is Wal-Mart hitting the wall?

BARRIE MCKENNA
Globe and Mail                 [back to top]

WASHINGTON — The bright yellow smiley face has been a fixture of Wal-Mart advertising for a decade now.

It's been like a good luck charm, beaming down on Wal-Mart and its customers as the company swept the planet, rolling back prices and opening thousands of new stores.

But after the year the company has just endured there are more long faces than happy ones around Wal-Mart Stores Inc. headquarters in Bentonville, Ark., these days. Among the setbacks: botched fashion upgrades, embarrassing leaks, a retreat from Germany, messy store renovations, failure to get a bank charter and the first monthly sales drop in a decade.

Now, the ubiquitous happy guy may be on the way out too as Wal-Mart remakes itself by reaching way beyond its loyal core of bargain hunters, hooked on "always low prices" on everything from socks to sausages.

"Wal-Mart is simply running into the law of big numbers," argued Dan Gilmore, editor of Supply Chain Digest, an online industry newsletter.

The company is packing stores closer and closer together, cannibalizing its own sales, and running headlong into crowded suburban markets already well-served by scores of savvy rivals, such as Target Corp., Best Buy Co. Inc. and J.C. Penney Co. Inc.

"Wal-Mart is trying to go upstream to attract a more upscale customer. But this is awfully hard for a store so ingrained in the public mind with low prices, staple goods and . . . a huge scale over which this transition has to be managed," Mr. Gilmore added.

Other critics complain that Wal-Mart has simply tried to do too much, too fast, and it caught up to them in 2006.

"Repositioning a ship like Wal-Mart is not a six-month project," explained retail consultant Richard Seesel of Retailing in Focus.

After three years of decelerating growth, Wal-Mart seemed to hit the wall as 2006 drew to a close. In November, sales fell 0.1 per cent -- the first monthly sales decline in a decade. And executives warned that sales in December would be flat.

Wal-Mart is apparently finding that it's not easy to transform itself from a mass marketer, where everything is a commodity, to a store that sells higher quality items at reasonable prices. It's one thing to be the price leader in kids' running shoes or Elmo dolls. It's quite another to stock clothing fashions that appeal to shoppers in both semi-rural Bentonville, Ark. and wealthy, urban Bethesda, Md.

Wal-Mart, for example, introduced a new line of private label "Metro 7" clothes in mid-2006. But many of the items, such as hip-hugging jeans, didn't go over well in much of Middle America, where the casual clothes of choice are more likely to be super-sized sweat pants and camouflage hunting apparel.

Some analysts said Wal-Mart is caught in a squeeze -- wanting to move upscale, but highly dependent on driving traffic with deep discounts on hot items, such as high-definition TVs and toys. And it's a tactic nimble rivals have learned to match.

"Everyone is now selling China Inc.," pointed out retail consultant John Landsdale of zaxpop.com. "The local hardware store, pharmacy or grocery store is as likely to have that profitable electronic, self-care, home thing or garden tool at as low a price as Wal-Mart.

Wal-Mart is stuck selling loss leaders, while the competition for the good stuff is too high."

So Wal-Mart has begun carefully segmenting both the look of its stores and the selection to appeal to narrower niches, such as Hispanics, African-Americans and upscale whites as part of a massive remodelling of 1,800 U.S. stores over 18 months.

Wal-Mart executives dismiss the criticism that size is an impediment to change.

At a recent meeting with analysts, Wal-Mart executive vice-president Eduardo Castro-Wright suggested size may actually be an asset as it creates clusters of similar stores -- chains within a chain.

"Our size sometimes gets in the way of many things," Mr. Castro-Wright said. "But it is very good . . . where you can continue to obtain the economies of scale. With the initial segments that we are working on right now, there's none that would have less than 100 stores. Each one of these segments is a chain."

And in the end, all of its customers essentially want the same thing, Wal-Mart executives insist.

"Every segment that we have -- from the loyalist who is the most financially challenged, to the skeptic who has a very high income," John Fleming, Wal-Mart's chief marketing officer told another gathering of analysts. "They want the same two things from Wal-Mart: They want unbeatable prices, and they want a fast, easy shopping experience."

The stress of all this change is starting to show. In early December, Wal-Mart abruptly fired the marketing executive who was put in charge of identifying new ad agencies to craft the image overhaul.

Julie Roehm, 36, who had been lured away from car maker DaimlerChrysler AG, left amid allegations that she had taken gifts and was too cozy with some of the ad executives vying for Wal-Mart's $580-million monster account.

Ms. Roehm, who was senior vice-president of marketing communications, is credited with introducing image advertising to Wal-Mart, including a series of commercials on ESPN's Monday Night football that took direct aim at Best Buy customers.

Her departure prompted speculation that "the smiley face" may not be on the way out after all.

"They need to get back to their roots," marketing consultant David Polinchock of Brand Experience Lab said, "and focus on who they are and stop all of their distractions, playing in a world where they seem to not fit."

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Bratz Dolls work conditions harsh

Associated Press
December 22, 2006                    [back to top]

The pouty Bratz dolls so popular as Christmas presents are made at a factory in southern China where workers are obliged to toil up to 94 hours a week, among other violations, a labor rights group said in a report released Friday.

The report by U.S.-based China Labor Watch and the National Labor Committee details allegations of harsh working conditions, especially during peak delivery months, and of violations of workers' rights to injury and health insurance.

The edgy, urban-styled rival to Barbie is made by a subcontractor in the southern export hub of Shenzhen, as is typical of many products sold in the U.S. and elsewhere.

Workers are paid the equivalent of 17 U.S. cents for each doll, the report said, while the dolls retail for US$16 (euro12) a piece or more.

Calls to the Van Nuys, California, headquarters of MGA Entertainment Inc., which launched the Bratz brand in 2001, were not answered and there was no immediate response to an emailed inquiry to the company's public relations office.

Calls to the China-based spokesman for Wal-Mart Stores Inc., a main distributor of the dolls, went unanswered Friday.

The allegations in the report describe practices found at many Chinese factories producing name-brand products for export. They include required overtime exceeding the legal maximum of 36 hours a month, forcing workers to stay on the job to meet stringent production quotas and the denial of paid sick leave and other benefits.

The report shows copies of what it says are "cheat sheets" distributed to workers before auditors from Wal-Mart or other customers arrive to ensure the factory passes inspections intended to ensure the supplier meets labor standards.

It said workers at the factory intended to go on strike soon to protest plans by factory managers to put all employees on temporary contracts, denying them of legal protection required for long-term employees.

More than 120 million Bratz dolls have been sold since the toy debuted in 2001

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Best (and Worst) Ads of '06

It Was the Year of Cavemen, YouTube and Anti-Advertising; Meeting Viewers 'Head On!'

By SUZANNE VRANICA
and BRIAN STEINBERG
December 22, 2006                        [back to top]

People may remember 2006 as the year of anti-advertising, when marketers and their ad agencies went to great lengths to make sure their ads didn't look like typical Madison Avenue handiwork.

To promote its new malt iced tea, Diageo PLC's Smirnoff created a two-minute spoof of a rap video and posted it on video-sharing Web site YouTube. The iced tea was mentioned only in passing. Almost 2 million people have viewed the Smirnoff ad on YouTube so far. "As soon as you do the classic bottle close-ups, big company graphics or lots of shots of sweaty bottles -- people reject it," says Kevin Roddy, executive creative director at BBH, the New York firm that crafted the video.

The low-key approach is a major reversal for an industry long keen on marketing messages delivered with a sledge hammer. It comes as new technologies -- such as digital video recorders -- give consumers more control over what ads they see. As a result, marketers' top priority is no longer selling but simply getting the public to watch an ad.

"There is a blurring of the line between advertising and entertainment," says Greg Stern, chief executive officer of Butler, Shine, Stern & Partners. "You have to bring consumers in first just to be able to talk to them."

Below is a list of our choices for the best and worst ads and other marketing gimmicks in 2006.

The Best Monkey Business

CAREERBUILDER.COM

CLIENT: CareerBuilder.com, a Web concern jointly owned by Gannett, Tribune and McClatchy. AGENCY: Cramer-Krasselt CONTENT: Consumers were able to construct a humorous video email featuring a chimp, and craft a customized message by recording a voice greeting via the telephone, which the chimp would repeat to the person the email was sent to. The emails were meant to drum up pre-game hype for two Super Bowl TV ads CareerBuilder was running featuring chimpanzees managing a corporation. FEEDBACK: Eleven months later, the monkey emails are still circulating. So far, CareerBuilder says, more than 80 million monkey emails have been played. The site's traffic rose 34% this year, due in part to the email campaign. CareerBuilder says one of the most important results of its Super Bowl viral push was that it held the interest of consumers, most of whom spent six to nine minutes playing with the make-your-own monkey emails.

TiVo Buster

KFC

CLIENT: Yum Brands Inc.'s KFC AGENCY: Interpublic Group's Foote Cone & Belding CONTENT: KFC carefully designed a TV ad to circumvent Madison Avenue's latest nemesis: digital video recorders. One frame in the ad contained a secret code word -- "Buffalo" -- which viewers can use to redeem a coupon for a free KFC "Buffalo Snacker" chicken sandwich. Only viewers who used their DVR, or an analog video cassette recorder, to slow the ad and watch it frame by frame could see the code. To get people to participate, KFC ran newspaper ads with details of when the ad would run. FEEDBACK: With ad-skipping devices threatening Madison Avenue's age old way of doing business, KFC and FCB were among the first to experiment with ways around the pesky devices. Roughly 103,000 people claimed "Buffalo Snacker" coupons after entering the hidden code on KFC's Web site. Furthermore, the publicity prompted an increase in the number of people visiting KFC's Web site. In the weeks the ad ran, the site drew 3 million page views, 40% more than the amount of traffic it usually gets over a similar period of time. The chicken purveyors also managed to land 852 mentions in the media, KFC estimates, including from some TV stations that ran the commercial free as part of a news report.

An Edgy Shave

PHILIPS NORELCO

CLIENT: Philips Electronics NV's Philips Norelco AGENCY: Omnicom Group Inc.'s Tribal DDB CONTENT: Philips knew it couldn't hawk its unique "Bodygroom" shaver -- designed to help a man shave hair on his back, chest and intimate body areas -- on a mass medium like TV. The product wasn't for everyone, and might even be seen as offensive. So the company's ad agency, Tribal DDB, went the lighthearted route -- creating a Web site starring a man wearing a bathrobe chatting about what the shaver could do. To get the word out, the agency alerted friends of employees. Publicis Groupe SA public-relations firm Manning Selvage & Lee also helped drive traffic to the site by getting the product mentioned on Howard Stern's program on Sirius Satellite Radio. FEEDBACK: Marketers are fast learning that they can address their promotional messages to specific audiences, rather than shouting something out to the whole world. Philips's Web ad uses various fruits and vegetables to refer to parts of the male anatomy -- a tactic that might prove shocking on TV, but is palatable to the smaller audience that flocked to the Web site because of its frat-boy jokes. Philips says sales of the product were way above its original projections and says the site drew 1.8 million unique visitors as of Dec. 12th.

Apple's Bite

APPLE COMPUTER

"CLIENT: Apple Computer Inc. AGENCY: Omnicom Group's TBWA\Chiat\Day CONTENT: A series of ads that played out on TV and the Web show the Apple Mac, represented by a hip-looking young man, debating its features with the PC, represented by a paunchy, nerdy-looking fellow. The Mac-man -- played by actor Justin Long, star of the film "Accepted," is clever, fun and handy -- he can communicate with all sorts of different people, and knows how to come up with pictures and music. The PC, played by another actor known to the youth crowd, "Daily Show" commentator John Hodgman, is decidedly less hip, and is always amazed, humbled or befuddled by Mac's never-ending range of abilities. FEEDBACK: Pepsi pokes fun at Coke, and Miller Brewing has smacked Anheuser-Busch, but this is razzing of a more sophisticated, and sustained, kind. Apple's knife cuts deep, but by the time rivals feel it, they have already started to bleed.

Hurts So Good

SPRINT NEXTEL

CLIENT: Sprint Nextel Corp. AGENCY: Omnicom Group's TBWA\Chiat\Day CONTENT: Two men are in a locker room and begin to compare cellphones, in an effort to see who has the most sophisticated gadget. One of the men says "I can watch live TV." His friend responds: "My Sprint phone has TV and downloads music." In response, the first man says his phone has a "crime deterrent" feature, which he demonstrates by throwing the phone at the other guy's head. FEEDBACK: In a crowded category, where telecommunication giants are spending hundreds of millions of dollars to woo customers, this ad got attention. Not only did it leave people laughing out loud but within 30 seconds a message about what the cellphone offers comes through loud and clear. The company received emails from consumers applauding the spot and Don Imus mentioned it during his morning radio program after it initially ran during the Super Bowl.

The Worst Flogging In Arkansas

CLIENT: Wal-Mart Stores Inc. AGENCY: Edelman, a unit of Daniel J. Edelman Inc. CONTENT: Edelman set up a blog called Wal-Marting Across America, which tracked the life of "Jim" and "Laura," a couple who drove cross-country in an RV visiting Wal-Mart stores. On the pro-Wal-Mart blog the duo conducted interviews with happy Wal-Mart workers. FEEDBACK: In a sign of how things can quickly go wrong for brands online, critics complained the company failed to disclose on the blog the full identities of two people -- one the sister of an Edelman employee -- whom it enlisted to write the pro-company blog. The controversy quickly spilled over into the mainstream media. Richard Edelman, president and chief executive of the public-relations giant and a long-time proponent of PR transparency and blog ethics, ended up apologizing on his blog.

We Heard You The First Time!

HEAD ON

CLIENT: Miralus Inc.'s Head On AGENCY: Created internally CONTENT: In a commercial notable for its bare-bones look, an announcer tells viewers, "Head On! Apply directly to the forehead!" She speaks the phrase three times in a row. The action follows the announcements. A person applies the product directly to the forehead. The announcer tells viewers where they can buy Head On. That's it. FEEDBACK: This topical analgesic is supposed to dispel headaches, but the ad ended up giving TV viewers one instead. YouTube is filled with spoofs of the spot. With its distinct lack of Madison Avenue frills, the Head On ad would seem to be the video equivalent of an Internet search ad -- it essentially gives the product's name and little else. The company never wanted to annoy people, says Dan Charron, Miralus's vice president of sales. It just wanted consumers to remember Head On when they went to the drug store. He says sales of the product increased while the ad was on earlier this year. One later version of the commercial showed a consumer interrupting the voice over to say: "I hate your commercial. But I love your product." Mr. Charron says, "We're putting out there what America is telling us."

Not So Sharp

GILLETTE

CLIENT: Procter & Gamble Co.'s Gillette AGENCY: Omnicom Group's BBDO CONTENT: In a Super Bowl ad meant to herald the launch of its five-blade (plus one for targeted trimming) Fusion razor, Gillette let loose with an anticlimactic ad that shows two scientists flying in a helicopter to a top-security secret desert base. Inside, they open the contents of two metal briefcases -- a canister of blue light that an announcer says is "a revolutionary technology" and a canister of yellow light that is meant to represent "a unique idea." The two colored lights combine to form the Fusion razor. FEEDBACK: Super Bowl ads, so the experts tell us, are meant to play to big crowds of people who are drinking and looking for a good time. The Gillette ad, however, is too abstract. The razor being advertised doesn't make its first appearance until more than 30 seconds into the commercial, and by that time, buffalo-wing eaters would likely have lost their taste for this difficult-to-comprehend effort. "As North America's #1 new consumer product this year, Fusion is successfully reaching guys, which was our goal with the Super Bowl ad," said a statement from a Gillette spokeswoman.

Steak Out

OUTBACK STEAKHOUSE

CLIENT: OSI Restaurant Partners Inc.'s Outback Steakhouse AGENCY: Publicis Groupe's Kaplan Thaler Group CONTENT: An offbeat Australian-sounding man waxes poetic about Outback Steakhouse and some of its dishes. In various ads, he compares himself to a boomerang, which he tries to remove from a restaurant wall, and bites the head off a shrimp after telling it "Good night, sir!" FEEDBACK: Huh? Funny characters promoting products are common techniques on Madison Avenue, but when the figure is too offbeat, the advertiser has got a challenge: Will this person's antics distract consumers from the real message? At present, Outback is running ads featuring shots of food and peppy music -- a typical maneuver for a restaurant chain in the midst of an advertising holding pattern.

Dr. Zero

DAIMLERCHRYSLER

CLIENT: DaimlerChrysler AG AGENCY: Omnicom Group's BBDO CONTENT: A series of off-beat ads starring DaimlerChrysler AG Chairman and Chief Executive Dieter Zetsche show the executive blathering about how Chrysler cars share engineering and design features with higher-priced Mercedes sedans. FEEDBACK: While CEO as pitchman is a widely used ad approach, it's a tricky ad technique to pull off. The Dr. Z. ads fall short and left consumers scratching their heads -- some weren't even sure Dr. Z was a real person (he is). The spots failed to jumpstart sales. The ads paled in comparison to the popular 1980s' ad effort starring the blunt-talking former Chrysler chief executive, Lee Iacocca. DaimlerChrysler defended the Dr. Z ad effort saying it did its job of informing consumers about what Chrysler stands for. The campaign also increased traffic to the Web site and "we had great consumer reaction to it," says a Chrysler spokeswoman.

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Wal-Mart could announce ad agency Friday

Reuters
Fri Dec 22, 2006                                [back to top]

NEW YORK (Reuters) - Wal-Mart Stores Inc. <WMT.N> is expected to announce a new ad agency -- its second switch in two months -- as early as Friday, the New York Post reported on its Web site.

The decision will come down to two finalists - Ogilvy & Mather and the Martin Agency, the Post reported.

Omnicom Group Inc.'s <OMC.N> GSD&M handled Wal-Mart's account for years, but the world's largest retailer earlier this year decided to put the $580 million account up for review.

In October, Wal-Mart awarded the account to Interpublic Group of Cos Inc.'s <IPG.N> DraftFCB and Carat, owned by Britain's Aegis Group Plc <AGS.L>.

In another twist, the company earlier this month said that its head of marketing communications, Julie Roehm, who led the switch, left the company. The retailer shortly after said it would reopen bidding for the advertising account.

© Reuters 2006. All rights reserved.

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Philadelphia to Keep Eakins Painting, Blocking Sale to Walton

By Sophia Pearson
Bloomberg                                          [back to top]

Dec. 21 (Bloomberg) -- Philadelphia officials said Thomas Eakins's painting ``The Gross Clinic'' will stay in the city, blocking a $68 million sale to the National Gallery and a museum founded by Wal-Mart Stores Inc. heir Alice Walton.

Philadelphia had until Dec. 26 to match the price for the 1876 work. Local groups have raised more than $30 million so far and Wachovia Corp. extended a line of credit to cover the balance if needed, Herbert Riband Jr., vice chairman of the board of trustees for the Pennsylvania Academy of the Fine Arts, said today in a telephone interview.

```The Gross Clinic' is by a Philadelphian, about Philadelphians and is set in Philadelphia,'' Mayor John Street said in a statement. ``It belongs in Philadelphia just as much as the Liberty Bell and our sports teams.''

Thomas Jefferson University's Nov. 10 disclosure of the sale, arranged by New York-based auction house Christie's International, caught the city by surprise. The school, which trains doctors and other health-care professionals, gave local institutions 45 days to match the offer.

Jefferson extended the deadline to raise the money by 30 days, to Jan. 25, spokeswoman Jackie Kozloski said today by phone. Alumni donated the painting to the university in 1878 after buying it for $200.

``It is fitting that this masterpiece joins the great collections of the Philadelphia Museum of Art and the Pennsylvania Academy of the Fine Arts, where it will be made accessible to millions of people,'' Brian Harrison, the chairman of Jefferson's board, said in an e-mailed statement.

2,000 Donations

The fundraising campaign, headed by the art academy and the Philadelphia Museum of Art, has brought in more than 2,000 donations from 30 states and the District of Columbia, according to a statement from the Pew Charitable Trusts, one of three $3 million donors. The Annenberg Foundation gave $10 million.

The Wachovia credit line will be shared by the museum and the academy, Riband said, declining to specify the exact amount. Wachovia, based in Charlotte, North Carolina, is the fourth- largest U.S. bank by assets.

``We're really pleased to be able to help a committed group of leaders in their effort to keep a masterpiece in the city of Philadelphia,'' Wachovia spokeswoman Barbara Nate said by phone. She said she couldn't comment on the credit terms.

The museum and the academy, where Eakins was a student and teacher, have said they would share ownership of the painting. Where and when it would be displayed hasn't been determined, said Kathleen A. Foster, an Eakins expert and the museum's curator of American art.

`Totally Thrilled'

`I'm totally thrilled,'' she said. ``We're announcing victory on one hand and on the other hand we're still continuing to chase after donations.''

Jefferson initially said the sale would help finance a 10- year expansion but later revised its plans to include an endowment for student scholarships.

Street, who had said he might block any sale by proposing to protect the painting under the city's historic preservation ordinance, dropped the suggestion this week, citing the progress made in fundraising.

``The Gross Clinic'' depicts Dr. Samuel Gross, whom Foster described as ``the emperor of American surgery,'' at about age 70, demonstrating the removal of a diseased bone from a patient while students look on. Four assistants aid in the operation, one covering the patient's face with cloth soaked in chloroform.

Too Graphic

Eakins took anatomy classes at Jefferson and ``The Gross Clinic,'' created for the 1876 Centennial Exposition in Philadelphia, paid homage to the city's advances in science, Foster said. Eakins painted the 8-foot-high (2.4-meter-high) canvas in the third-floor studio of a Philadelphia row house. At the time, it was deemed too graphic for the festival's central display and was moved to a smaller exhibit of medical drawings.

Walton's publicist, Elise Mitchell, didn't immediately return a call seeking comment. Walton's museum, the Crystal Bridges Museum of Art, is to open in 2009 in Bentonville, Arkansas, where Wal-Mart is based.

Walton last year bought Asher B. Durand's 1849 painting ``Kindred Spirits'' from the New York Public Library for $35 million, topping a joint bid from the National Gallery in Washington and the Metropolitan Museum of Art in New York.

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Another Key Marketing Exec Exits Wal-Mart

BrandWeek
December 21, 2006                          [back to top]

NEW YORK -- The revolving door at Wal-Mart’s marketing department apparently has not stopped spinning, as it was confirmed today that Mark Goodman, who was the evp-marketing at Sam’s Club for 14 months, has left the company. A spokeswoman at Wal-Mart would only say that Goodman left to “pursue other interests.”

Prior to joining Wal-Mart, Goodman was an executive with McDonald’s.

In a statement, Susan Koehler, senior manager at Sam’s Club’s corporate communications, said, ”During Mark’s time with Sam’s Club, he contributed important new ideas to our marketing efforts and has helped move us to becoming a more member-driven organization.”

Goodman’s departure follows the controversial exits of Julie Roehm and Sean Womack, which initiated Wal-Mart’s second agency review in the last several months.

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Tariff waivers signed into law

By Aaron Sadler
The Morning News (Arkansas)
December 20, 2006                             [back to top]

WASHINGTON -- President Bush on Thursday signed into law a wide-ranging bill that included hundreds of tax breaks on imported goods, including some benefiting Wal-Mart. Wal-Mart will save on eliminated or reduced tariffs for clock radios, rubber floor mats and nail clippers among other items.

Broad tax legislation containing 520 tariff suspensions was approved on the last day of Congress' term earlier this month.

Critics of tariff suspensions charge they amount to special-interest legislation benefiting a small number of companies that profit from not having to pay fees on goods they import and then sell to U.S. consumers.

Others, like Sen. Blanche Lincoln, D-Ark., said the practice helps home-state interests and home-state jobs. She sponsored many of the provisions benefiting the giant Bentonville-based corporation.

"The process is a customary practice that is intended to make products that are not domestically produced more affordable to customers," Lincoln said in a statement. "I am happy to help any Arkansas company pass along savings to customers."

Congress passed more than 800 tariff suspension bills during its most recent term, estimated to cost hundreds of millions of dollars.

Lincoln also sponsored bills to reduce or eliminate tariffs for chemicals used by Ciba Chemicals, with operations in West Memphis, and Eastman Chemical Company, which has a plant in Batesville. Those tariff suspensions also were rolled into the legislation Bush signed into law.

In September, Lincoln backed away from another piece of legislation suspending tariffs on imported dog collars, leashes and muzzles. An upstate New York woman complained to the U.S. International Trade Commission the 2.4 percent tariff reduction could jeopardize her domestic operation. Tariffs are instituted not only as a way to generate revenue, but to also shield American manufacturers from foreign competition. Companies often request tariff suspensions when no domestic manufacturer produces an item.

The bill Bush signed into law suspends tariffs until 2009 for clock radios and AM radios without a clock. Tariffs for certain rubber floor mats and manicure/pedicure sets would fall from 2.7 percent and 4.1 percent, respectively, to 1.96 percent.

All four tariff measures were requested by Wal-Mart.

A Wal-Mart spokeswoman did not return a call Wednesday seeking comment.

The clock radio waiver was estimated to cost $855,000 annually in lost federal revenue, while the AM radio suspension will cost less than $3,000 annually, according to trade commission estimates.

Reductions on manicure sets were estimated to cost about $588,000 this year up to $770,000 in 2010. Lost revenue from the floor mat waiver is estimated at $784,000 by 2010.

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Baptists fault Wal-Mart for exploitation

ReligionAndSpirituality.com
December 20, 2006                           [back to top]

A group of Baptist pastors and leaders has spoken out against Wal-Mart for exploiting workers to increase profits. The self-styled low-price leader has also recently come under attack from pro-gay groups for backpedaling on diversity initiatives.

Robert Parham, executive director of the Baptist Center for Ethics, recently lead the charge against Wal-Mart on national TV. He appeared Dec. 15 on CNBC's "On The Money" to discuss a letter and television ad in which Joe Phelps, pastor of Highland Baptist Church in Louisville, Ky., demanded the retailer adhere to the Golden Rule — Jesus' command to "do unto others as you would have them do unto you," Associated Baptist Press reported Tuesday.

The TV ad, which aired Dec. 14 in 25 states and 43 markets, was funded by the union-backed WakeUpWalMart.com. The group accuses the company of gender-based discrimination, child-labor law violations, and failure to provide health care to workers.

Parham appeared on CNBC opposite Ira Combs, pastor of Greater Bible Way of the Apostolic Faith in Jackson, Mich., who defended Wal-Mart for its history of creating jobs and providing inexpensive goods in low-income neighborhoods.

On the show, Parham said Jesus would be "more concerned about health care for the children of Wal-Mart employees than low prices."

"When we celebrate Christmas, we celebrate the birth of Jesus Christ, who gave us the moral imperative, the Golden Rule, and ... we believe that the Golden Rule challenges American consumers to think about where they should shop," he said in the interview, which is archived on CNBC's website.

Parham said all people of faith affirm the value of the Golden Rule, so Wal-Mart should "strive to be a Golden Rule company — not follow secondary standards and seek only profit for a few...."

Combs responded by pointing out that Wal-Mart is "not running for sainthood" but operates in a capitalist, free-market system. He said the store has become a target simply because it meets consumer needs better than competitors. In a subsequent recap of the event, Parham noted Combs serves on an advisory group recruited by Wal-Mart to counter negative public opinion.

"I think that the problem here is this is not really a theological question and debate, this is really an ideological one, which deals with social and economic issues," Combs said. He also blamed Parham for philosophy "steeped in a great deal of the union philosophical bent with regard to how these businesses and corporations should operate and carry out their business."

On the WakeUpWalMart.com TV spot, Phelps asked shoppers: "If these are Wal-Mart's values, would Jesus shop at Wal-Mart? Should you?"

Apparently, the answer is no. In a column that appeared on ethicsdaily.com, Phelps said shopping at Wal-Mart is "an insult to God ... What we buy matters to others and to God."

Phelps said he made the ad to "wake up the American consumer, especially those with Bible values, to the reality that our buying power has real power to affect a lot of people around the world."

"Everyone wants lower prices, but not at the expense of neighbors who work for Wal-Mart, or people around the world who make their products," he wrote. "Our purchasing choices are the crucial link in granting companies like Wal-Mart our tacit permission and our financial support to continue practices that exploit the young, the vulnerable, and the working poor."

A spokeswoman for Working Families for Wal-Mart, a group formed to defend the store, called the ad campaign "shameful," especially during the holidays. "While the union leaders are wasting their members' dues on an attack campaign, Wal-Mart is benefiting tens of millions of working families through its low prices and quality job opportunities," she said in a press statement.

More than 176 million people shop at Wal-Mart each week. The retailer has more than 1.8 million employees worldwide, 1 million of whom have health plans, according to the Wal-Mart website.

Phelps is a board member of the Baptist Center for Ethics, which commissioned a petition letter to the same effect as the TV commercial. The letter, drafted by Parham, was sent in partnership with WakeUpWalMart.com to Wal-Mart CEO Lee Scott. As of Dec. 19, 132 people had signed it, including activist Tony Campolo, seminary professors and many Baptist pastors.

Calling themselves "moral theologians," the signers said: "We believe that Wal-Mart has been given and entrusted with much wealth, power and influence," the letter said. "Wal-Mart's leaders need to recognize their moral obligations to be good stewards of what the corporation has been given and entrusted, not simply through acts of charity but with justice for working-family employees who have built, but not necessarily benefited, from Wal-Mart's vast earnings."

WakeUpWalMart is sponsored by the United Food and Commercial Workers International Union.

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Philippines: Workers left hanging as Wal-Mart stalls

NoSweat.com                              [back to top]

As the Worker Rights Consortium (WRC) prepares to release a public report on the findings of its investigation into the alleged abuses, Wal-Mart has announced it is contracting the US monitoring organization Verité to do yet another third-party investigation, which, conveniently, would not be completed until the end of the holiday shopping season. The factory had been audited twice previously, once by a commercial auditing firm and the second time by the company’s own compliance staff shortly after MSN and the International Labor Rights Fund (ILRF) brought the violations to the company’s attention. To date, Wal-Mart has not reported on the findings of those investigations.

According to the Philippine Workers' Assistance Center (WAC), there is already sufficient evidence that Chong Won management has harassed and discriminated against union members, pressured workers to sign statements against the union, illegally fired two union leaders, issued dismissal letters to 16 union members involved in a legal strike, and called in the police to escort scabs into the factory, which resulted in police assaults on the strikers.

The police assaults against the strikers took place at a time of growing repression and extra-judicial killings of union leaders and human rights activists in Cavite Province, including the murder of WAC's chairperson, Bishop Alberto Ramento, and Solidarity of Cavite Workers leader, Jesus Buth Servida.

Please write Wal-Mart today, urging the company to stop delaying and bring appropriate pressure on its supplier to reinstate the illegally fired workers, enter into good faith negotiations with the union for a first collective agreement, and cease all anti-union harassment and discrimination.

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Wal-Mart takes toy set off the shelves

The Mississauga News
Dec 20, 2006                               [back to top]

Mississauga-based Wal-Mart Canada has voluntarily removed a children's play set featuring a Noah's Ark toy and various plastic figures from the shelves of its 273 stores because the small pieces could choke a small child. In what is strictly a precautionary move, the company has also issued a voluntary safety notice on the toy set, and instructs customers who own the product to stop children from using it and to contact Wal-Mart's Director of Risk Management or the Regulatory Compliance Manager.

Packaging for the play set notes that it is safe for children aged three and older. Under Health Canada guidelines, testing shows that, while the product may appeal to young children 18 months and older, some of its small, plastic pieces pose a potential choking hazard.

No injuries have been reported.

The Polyfect Toy Company Noah's Ark play set has been sold in Wal-Mart Canada stores since February 2004.

In the interest of customer safety, the company has put up in-store safety posters to bring the issue to the public's attention.

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Sam's Club Marketing Chief Leaves Warehouse Retailer Departure Comes as Wal-Mart Unit's First National TV Ad Effort Rolls Out

By Mya Frazier
Advertising Age
December 19, 2006                               [back to top]

COLUMBUS, Ohio (AdAge.com) -- After 14 months on the job, Mark Goodman, who held the top marketing job at Wal-Mart's Sam's Club, has left the company. The departure comes just weeks before Sam's Club's first national TV ad campaign. First national ad effort

The exec VP-marketing, membership and e-commerce leaves just weeks into the division's first national TV advertising campaign from agency Strawberry Frog, a push that focused the division's advertising budget away from its small-business customer.

In August, Mr. Goodman, a former McDonald's Corp. executive, moved the account to the New York-based independent agency from Omnicom Group's GSD&M, Austin. That review was handled separately from the troubled $580 million Wal-Mart review.

The campaign was a bid to snare the attention of the mass-market shopper and aired on shows such as "Deal or No Deal" and National Football League games. It also touted the chain's new relationship with Mastercard that began Nov. 10.

Trailing Costco

Sam's Club has fallen behind fast-growing Seattle-based Costco, the No. 1 warehouse retailer in the U.S. Costco has 504 stores and nearly $59 billion in sales, compared with Sam's 550 stores and $39.8 billion in sales in 2006, accounting for 12.7% of Wal-Mart's sales in 2006.

Regarding Mr. Goodman's departure, Wal-Mart spokeswoman Sarah Clark said in an e-mail: "Mark has moved on to pursue other interests. During Mark's time with Sam's Club, he contributed important new ideas to our marketing efforts and has helped move us toward becoming a more member-driven organization. We appreciate his service and past contributions to Sam's Club."

Mr. Goodman will be replaced, according to the company. Calls and e-mails to Scott Goodson, CEO of Strawberry Frog, were not returned at press time.

No review planned

"We don't have any plans to review the Strawberry Frog account decision at this time," Ms. Clark added.

Mr. Goodman joined the 550-store warehouse division of Wal-Mart in late September 2005, after nearly six years at McDonald's, where he held the title of VP-U.S. strategy and operations.

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BCE, others urge Wal-Mart to practice Golden Rule

By Hannah Elliott
Associated Baptist Press
December 19, 2006                              [back to top]

DALLAS (ABP) -- Wal-Mart, the self-styled low-price leader, can’t seem to get a break these days. While the giant retailer has recently come under attack from pro-gay groups for backpedaling on diversity initiatives, a group of Baptist pastors and leaders has spoken against Wal-Mart for exploiting workers in order to increase profits. Robert Parham, executive director of the Baptist Center for Ethics, recently lead the charge against Wal-Mart on national TV. He appeared Dec. 15 on CNBC's "On The Money" to discuss a letter and television ad in which Joe Phelps, pastor of Highland Baptist Church in Louisville, Ky., demanded the retailer adhere to the Golden Rule -- Jesus' command to "do unto others as you would have them do unto you."

The TV ad, which aired Dec. 14 in 25 states and 43 markets, was funded by the union-backed WakeUpWalMart.com. The group accuses the company of gender-based discrimination, child-labor law violations, and failure to provide health care to workers.

Parham appeared on CNBC opposite Ira Combs, pastor of Greater Bible Way of the Apostolic Faith in Jackson, Mich., who defended Wal-Mart for its history of creating jobs and providing inexpensive goods in low-income neighborhoods.

On the show, Parham said Jesus would be “more concerned about health care for the children of Wal-Mart employees than low prices.”

“When we celebrate Christmas, we celebrate the birth of Jesus Christ, who gave us the moral imperative, the Golden Rule, and … we believe that the Golden Rule challenges American consumers to think about where they should shop,” he said in the interview, which is archived on CNBC's website.

Parham said all people of faith affirm the value of the Golden Rule, so Wal-Mart should “strive to be a Golden Rule company -- not follow secondary standards and seek only profit for a few….”

Combs responded by pointing out that Wal-Mart is “not running for sainthood” but operates in a capitalist, free-market system. He said the store has become a target simply because it meets consumer needs better than competitors. In a subsequent recap of the event, Parham noted Combs serves on an advisory group recruited by Wal-Mart to counter negative public opinion.

“I think that the problem here is this is not really a theological question and debate, this is really an ideological one, which deals with social and economic issues,” Combs said. He also blamed Parham for philosophy “steeped in a great deal of the union philosophical bent with regard to how these businesses and corporations should operate and carry out their business.”

On the WakeUpWalMart.com TV spot, Phelps asked shoppers: “If these are Wal-Mart's values, would Jesus shop at Wal-Mart? Should you?”

Apparently, the answer is no. In a column that appeared on ethicsdaily.com, Phelps said shopping at Wal-Mart is “an insult to God … What we buy matters to others and to God.”

Phelps said he made the ad to "wake up the American consumer, especially those with Bible values, to the reality that our buying power has real power to affect a lot of people around the world.”

“Everyone wants lower prices, but not at the expense of neighbors who work for Wal-Mart, or people around the world who make their products,” he wrote. “Our purchasing choices are the crucial link in granting companies like Wal-Mart our tacit permission and our financial support to continue practices that exploit the young, the vulnerable, and the working poor.”

A spokeswoman for Working Families for Wal-Mart, a group formed to defend the store, called the ad campaign “shameful,” especially during the holidays. “While the union leaders are wasting their members' dues on an attack campaign, Wal-Mart is benefiting tens of millions of working families through its low prices and quality job opportunities,” she said in a press statement.

More than 176 million people shop at Wal-Mart each week. The retailer has more than 1.8 million employees worldwide, 1 million of whom have health plans, according to the Wal-Mart website.

Phelps is a board member of the Baptist Center for Ethics, which commissioned a petition letter to the same effect as the TV commercial. The letter, drafted by Parham, was sent in partnership with WakeUpWalMart.com to Wal-Mart CEO Lee Scott. As of Dec. 19, 132 people had signed it, including activist Tony Campolo, seminary professors and many Baptist pastors.

Calling themselves “moral theologians,” the signers said: “We believe that Wal-Mart has been given and entrusted with much wealth, power and influence,” the letter said. “Wal-Mart's leaders need to recognize their moral obligations to be good stewards of what the corporation has been given and entrusted, not simply through acts of charity but with justice for working-family employees who have built, but not necessarily benefited, from Wal-Mart's vast earnings.”

WakeUpWalMart is sponsored by the United Food and Commercial Workers International Union.

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Wal-Mart Wins Labor Complaint

Chain Store Age
Tuesday, December 19, 2006            [back to top]

A federal judge has ruled that Wal-Mart Stores Inc. can't be held liable under U.S. law for labor conditions at some of its overseas suppliers, according to a report by Bloomberg News. Last year, a complaint by the labor rights group International Labor Rights Fund claimed that employees of Wal-Mart suppliers in China, Bangladesh, Indonesia, Swaziland and Nicaragua were forced to work overtime without pay and in some cases were fired because they tried to organize unions. The group sought to represent hundreds of thousands of employees of Wal-Mart's overseas suppliers.

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Wal-Mart Recalls 70,300 Christmas Mug Gift Sets

Matthew Borghese
All Headline News
December 19, 2006                  [back to top]

Washington, D.C. (AHN) - The U.S. Consumer Product Safety Commission and Wal-Mart Stores Inc. is recalling 70,300 Holiday Time Christmas Mug Gift Sets.

According to Wal-Mart, the sets, which were made in China, have buttons that could detach from the plush characters sold with the mug gift sets, posing a choking hazard to young children.

The gift sets include a decorated ceramic mug and a stuffed Santa, snowman, or reindeer. The stuffed characters measure 7-inches tall and are made of fleece-like material. Two red and green buttons are sewn down the front of the characters. "(c)DanDee(tm) COLLECTOR'S CHOICE(r)" and the product's UPC number are printed on the character's sewn-in labels. UPC numbers are as follows: Santa 0 47475 45419 8, Snowman 0 47475 45429 7, Reindeer 0 47475 45439 6. "Holiday Time(tm)" is printed on the character's hang tag. The mug comes in three designs and measures 6-inches tall. The designs include a Santa with green background, a snowman with blue background, and a Christmas tree with green background.

The sets were sold exclusively at Wal-Mart stores nationwide from October 2006 through December 2006 for about $5.

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China's Wal-Mart headquarters gets Communist branch

Associated Press
December 19, 2006                     [back to top]

BEIJING - Employees at the China headquarters of Wal-Mart Stores Inc. have set up a Communist Party branch, part of a growing campaign to expand the ruling party’s presence in foreign companies. The move follows the success of China’s state-sanctioned labor body in setting up unions at Wal-Mart outlets this year. The company is one of China’s biggest and most prominent foreign employers, with a work force of 36,000 and 68 stores.

The party branch was set up Friday at Wal-Mart headquarters in the southern city of Shenzhen, according to the party newspaper People’s Daily and a Wal-Mart spokesman, Jonathan Dong.

“Quite a few of our associates are party members already, so they have a right to establish branch organizations,” he said. Dong didn’t know whether Wal-Mart would have any formal interaction with the branch or whether its establishment would affect operations. Employees who answered the phone at the party’s Shenzhen office and wouldn’t give their names said they had no information on what the branch at the Wal-Mart headquarters would do.

Several of Wal-Mart’s Chinese stores already have Communist Party branches. The first was set up Aug. 12 in the northeastern city of Shenyang.

The party branch there has said it would not interfere in store management. An official quoted by the state Xinhua News Agency said it would encourage members “to play an exemplary role in doing a good job” and to help the company grow.

Many foreign companies in China already have party branches, either officially or unofficially.

China’s 70 million-member Communist Party and its affiliated All-China Federation of Trade Unions, or ACFTU, are trying to expand their presence in foreign companies to keep pace with a fast-changing society amid capitalist-style economic reform.

State industry, their traditional base, has slashed millions of jobs while private companies are creating tens of millions more. In a bid to stay relevant, the party has begun offering membership to entrepreneurs and others in the new private economy.

Wal-Mart, based in Bentonville, Ark., resisted the creation of unions at its Chinese stores for two years before agreeing in August to help the ACFTU organize its workers. The company has few unions elsewhere in its worldwide operations.

The party and labor expansion campaigns were ordered in March by President Hu Jintao, who also is the party’s general secretary, according to Chinese media.

“Do a better job of building (Communist) Party organizations and trade unions in foreign-invested enterprises,” the order said, according to the newspaper Beijing News.

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Wal-Mart Recalls 56,000 Toys

KamCity                          [back to top]

Wal-Mart has voluntarily recalled 56,000 stuffed toys because of a possible choking hazard to young children, the U.S. Consumer Product Safety Commission has reported. The Commission added that no incidents or injuries have been reported. The toys, in the form of Christmas beagles, were priced at about $3 and at Wal-Mart’s US stores from September through December. The red pompoms on the wreath attached to the beagle's mouth could detach, posing a choking hazard.

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Party Branch Set Up at Wal-Mart in China

By JOE McDONALD
Associated Press
12.18.06                                             [back to top]

Employees at Wal-Mart's China headquarters have set up a Communist Party branch, the company and party said Monday, amid a campaign to expand the ruling party's presence in foreign companies.

The move follows the success of China's state-sanctioned labor body this year in setting up unions at the U.S. retailer's outlets. Wal-Mart (nyse: WMT - news - people ) is one of China's biggest and most prominent foreign employers, with a workforce of 36,000 and 68 stores.

The party branch was set up Friday at Wal-Mart headquarters in the southern city of Shenzhen, according to the party newspaper People's Daily and a Wal-Mart Stores Inc. spokesman, Jonathan Dong.

"Quite a few of our associates (employees) are party members already, so they have a right to establish branch organizations," Dong said.

Dong said he didn't know whether Wal-Mart would have any formal interaction with the branch or whether its establishment would affect operations. Employees who answered the phone at the party's Shenzhen office and wouldn't give their names said they had no information on what the branch at the Wal-Mart headquarters would do.

China's 70 million-member Communist Party and its affiliated All-China Federation of Trade Unions are trying to expand their presence in foreign companies to keep pace with a fast-changing society amid capitalist-style economic reforms.

State industry, their traditional base, has slashed millions of jobs while private companies are creating tens of millions more.

In a bid to stay relevant, the party has begun offering membership to entrepreneurs and others in the new private economy.

The ACFTU, the umbrella body for unions permitted by the government, has announced a target of setting up unions at 60 percent of China's 150,000 foreign companies by the end of this year.

An ACFTU spokesman, Li Jianmin, said Monday he had no figures on how close the body is to meeting that goal.

The party has not disclosed its own expansion target.

The party branch at Wal-Mart headquarters is the company's sixth in China, according to Dong.

The first was set up Aug. 12 in the northeastern city of Shenyang. Party officials there said it would not interfere in store management. An official quoted by the state Xinhua News Agency said the Shenyang branch would encourage members to "to play an exemplary role in doing a good job" and to help Wal-Mart grow.

Many foreign companies in China already have party branches, either officially or unofficially.

One of the earliest was at U.S.-based cell phone maker Motorola (nyse: MOT - news - people ) Inc. in the eastern city of Tianjin. The branch officially was established in 1997, but news accounts say it was set up as early as 1990 and kept secret in order to avoid alarming Motorola management.

Wal-Mart, based in Bentonville, Arkansas, resisted the creation of unions at its Chinese stores for two years before agreeing in August to help the ACFTU organize its workers.

The party and labor expansion campaigns were ordered in March by President Hu Jintao, who also is the party's general secretary, according to Chinese media.

"Do a better job of building (Communist) Party organizations and trade unions in foreign-invested enterprises," the order said, according to the newspaper Beijing News.

Copyright 2006 Associated Press. All rights reserved. This material may not be published broadcast, rewritten, or redistributed

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Home World May Sell 5 Outlets in Tianjin to Wal-Mart

homeway.com                             [back to top]

TIANJIN, December 18, SinoCast -- Being troubled with a shortage of CNY 1.6 billion capital, China's Home World would sell 5 of total 10 outlets in Tianjin to Wal-Mart, sources were quoted as saying.

However, industry analysts showed the acquisition may not be achieved although the two sides are in talks over the matter. The Chinese supermarket chain retailer planned to sell ten stores to global big powers such as Wal-Mart and Carrefour before finally inking a contract with domestic peer Shanxi Meet all United Supermarket Co. in November.

Wal-Mart would see its outlets outnumber those of the tough rival Carrefour there if it would wrap up the acquisition with the struggling Home World.

Wal-Mart, which is spreading apace in China, will take Tianjin as a significant market, and the world's retail giant is preparing establishment of a northern China logistics center in the city.

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Havre Wal-Mart revs up

By KIM SKORNOGOSKI
Tribune                                               [back to top]

HAVRE — The wait was long.

Longer than the weeks since construction wrapped. And longer than the months since the announcement made in March 2005.

For years Havre buzzed with the rumor that Wal-Mart was coming to town.

With the store's grand opening now scheduled for Jan. 19, the town is rife with anticipation and anxiety.

Even as Havre's population nudges 10,000, many residents head south to Great Falls for shopping. There's hope that Wal-Mart not only will keep some people from leaving, but also will draw in shoppers from elsewhere.

"There aren't a whole lot of shopping options between here and North Dakota," points out Rob Munguia, Wal-Mart's Havre store manager.

While most Wal-Marts draw customers from as far as 50 miles away, Havre's store is the closest Wal-Mart for Hi-Liners more than 100 miles east on Highway 2.

As happens nearly everywhere when Wal-Mart comes to town, though, some retailers agonize over how they'll compete if Wal-Mart sells products for the same price that they pay the manufacturers.

"People stop me on the street and ask when Wal-Mart is opening and are excited," said Mayor Bob Rice. "I think the business people have mixed emotions."

Every day this month, someone taps on the store's windows, hoping that — despite the vacant parking lot — the business is open.

The supercenter is 105,000 square feet — about half the size of the Great Falls store — and includes groceries, a pharmacy, photo department and tire service.

'Driving a lot less' Like many living in rural Montana, Roberta Matt drives miles to get groceries other than the occasional loaf of bread she picks up at Rocky Boy's lone convenience store.

Once a week she drives 85 miles to Great Falls, making stops at Wal-Mart, Old Navy and the Holiday Village Mall. For groceries it's a 20-minute drive to Havre.

With Wal-Mart's store in Havre she be driving a lot less.

"There's a lot of people that go to Great Falls to shop," she said. "People will still go to Great Falls, but less frequently."

David Kleinsasser, who heads the East End Hutterite Colony near Havre, expects members to shop at the Havre Wal-Mart three or four times a week.

"I think it's a plus for the area, getting people in from other areas. Maybe from across the border, places like Chinook and Glasgow — if they find a savings they'll be coming back."

Rice said the city is getting calls from Canadians wanting to come to Havre's Wal-Mart to shop for Christmas.

His mother, who now makes monthly trips to the Great Falls Wal-Mart with her friends, is eager to shop locally.

Paul Polzin, director of the University of Montana's Bureau of Business and Economic Research, said Wal-Mart could help Havre develop into a Hi-Line shopping hub.

He saw similar development in Miles City and Bozeman. Instead of driving all the way to Billings, Miles City pulls eastern Montana shoppers and Bozeman takes those to the west.

Finding enough employees in Havre may be more difficult than drawing customers.

Munguia hopes to have 220 employees hired by Jan. 2 for training. More than 70 percent will be full-time jobs.

That would make Wal-Mart Havre's fifth biggest employer, behind the hospital, railroad, public schools and the college.

For the month of November, Munguia set up a table in downtown Atrium Mall to collect applications. He received more than 400 applications and so far hired 150 people at an average hourly wage of $9.

The table is now in the nearly empty store, and managers are cramming in hours to interview in between time spent setting up shelves and signs.

Like the rest of the state, Havre's unemployment rate is dropping. In October, it was 3.5 percent.

Wal-Mart isn't the only new or growing business in the Hi-Line town. The American Hotel recently opened and a Vegas-style casino is slated to open soon near Box Elder.

Havre Job Service Workforce Center manager Pam Harada saw 110 new job listings in October, twice as many as that month last year.

"Employers for quite some time have talked about the challenge in finding enough employees and employees with the skills they want," she said. "I don't think that's a new phenomena since Wal-Mart began hiring."

She said wages are climbing steadily with an average much higher than minimum wage.

Rice said word that Havre is hiring has traveled across several states. The driver's license bureau is seeing an influx of people moving from Idaho, Washington and California because they got jobs in Havre.

"Almost every business in town here is looking for help," Rice said. "We've had kind of an upswing in our economy here. (Wal-Mart) is going to have trouble finding 225 permanent employees."

Munguia said several people Wal-Mart hired once worked for Bi-Mart, which pulled out of the Havre Holiday Village Mall earlier this year.

Products started coming into the store this week. It takes six to eight weeks to prepare and fill a new store.

Cheryl Fenzau, who is the jewelry department supervisor, spent the last two weeks helping get the store ready.

She moved to Havre more than a year and half ago when she became co-owner of the Plainsmen Sports Bar and Steakhouse.

As a customer, she's anxious for the store to open.

Now as an employee, she's excited about the opportunities to advance within the company.

"No matter where life takes me, I can build on what I do here."

A month after Wal-Mart announced it was building in Havre, the Chamber of Commerce organized a full day training session for local retailers on how to compete with big box stores.

Chamber Executive Director Debbie Vandeberg said between 150 and 200 people attended.

A number of those shop owners contacted by the Tribune declined to talk about Wal-Mart's opening.

"I'd be honest to say (the business community's) response was mixed," Vandeberg said.

"We worked through this. The announcement always comes as a blow to a community that relies on local businesses, but we've moved past that."

Janine Donoven, owner of JM Donoven Designs in Fine Jewelry since 1995, is confident she'll survive Wal-Mart's arrival.

Attending the training only reinforced what every successful small town business already knows, she said.

"We have competition every day, including the Internet — it's not just Wal-Mart," she said. "We offer good customer service and we offer good service after the sale. That's the biggest thing we can do."

When he heard the Wal-Mart news, Creative Leisure manager Rick Linie began to research.

Statistics about stores closing in Wal-Mart's wake made him nervous at first.

He hopes his customers will appreciate what his CD/DVD and movie rental store has to offer.

"If people want us here, we'll be here," he said. "We provide knowledge. We provide customer service. We are crucial parts of the community."

Both he and the store owner volunteer on boards and donate to community events. Linie manages the new college radio station.

Linie expects Wal-Mart won't lure away the majority of their music customers — 30- to 50-year-olds looking to experiment with new artists.

"Those people still want record stores," he said. "They don't want to buy their music where they buy their cat litter."

Businesses such as Creative Leisure are waiting to see they'll benefit from the Hi-Line shoppers Wal-Mart lures in.

Great Falls Wal-Mart Store Manager Lance Lerud said the store racks up the second most sales in the state, drawing in 95,000 customers.

Looking at license plates, he is surprised at how many are coming from northern counties and Canada.

While Great Falls was once planning a second Wal-Mart, the company likely wants to see the impact Havre's store has in Great Falls before pursuing a new store in town, Lerud said.

Great Falls Development Authority Vice President of Marketing Steve North said Great Falls will continue to draw people from northern Montana and Canada, where they don't have stores like Target and Victoria's Secret.

But he said it's foolish to think that Havre's Wal-Mart won't have an impact here.

"How big of an impact? There's really no way of knowing," North said. "A very large percentage of the people in Havre won't come to Wal-Mart here. Why would they?"

Polzin's research suggests that roughly one-fifth of Great Falls' economy is related to serving the surrounding rural areas.

The vast majority comes to Great Falls for medical care, but shopping is third on the list.

"In many ways Havre is a competitor with Great Falls," Polzin said. "On the other hand Havre is complimentary because they'll still come to Great Falls for medical care."

Havre's mayor is riding the fence, unsure of what Wal-Mart's long-term impact will be on the Hi-Line.

"I think the jury's still out."

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Faith-based protesters gather at Wal-Mart

By Nadia M. Taylor
Mobile Press-Register
December 16, 2006                                 [back to top]

About 20 people -- including several longtime Wal-Mart employees -- were asked to leave the parking lot of the Tillman's Corner Wal-Mart on Friday evening as they were holding a candlelight vigil to protest what they called the "anti-family policies" of the national chain. The vigil was part of a larger, faith-based campaign launched Friday in more than 40 cities across the country, "to highlight the moral issues surrounding Wal-Mart's anti-family business practices," according to WakeUpWalMart.com., the online organization that spearheaded the multi-faith, multi-state event.

"We were going to pray for Wal-Mart to change their ways," Donald Wright, a local activist for WakeUpWalMart.com, said from across the store's parking lot Friday night.

"We had our candles, and as we were walking toward the front of the store, the manager came out and told me ... we could leave or he would call the police."

A manager at the store declined comment Friday night.

Several Wal-Mart employees were present at the protest, including Marty Charest, a 16-year Wal-Mart veteran. "It's not family-oriented like it used to be," Charest said. "It used to be that family comes first."

Sheila Burroughs, an 18-year Wal-Mart employee, said that "a lot more (employees) were going to show up, but they were afraid they'd lose their jobs."

Some of the problems alleged by the organization include child labor law infractions, insufficient health care plans, salary caps, and "a scheduling policy which makes it impossible for employees to have a normal life or spend regular time with their families," according to their Web site.

Wal-Mart launched a plan in September to slash the prices of almost 300 generic prescription drugs, which some analysts said could help the Arkansas-based retailer address an image problem stemming from the controversial policies on health insurance coverage for employees.

"We're not trying to do Wal-Mart harm," Lamar Stringfellow, who has worked at the Tillman's Corner Wal-Mart for 15 years, said Friday evening. "We just want them to treat us right."

(The Associated Press contributed to this report.)

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"Wake-up Wal-Mart" protests nation's largest retailer

By Richard Allyn
NBC 15
December 16, 2006                             [back to top]

(MOBILE COUNTY, Ala.) Dec. 15 - With only ten days to go before Christmas, the nation's largest retail chain is being called a "Scrooge" by a group of critics, a group that includes some of its own employees. While the nation's largest retailer is welcoming thousands of holiday shoppers, it is not welcoming a nationwide group of protestors, a group made up largely of Wal-Mart's own employees.

While management quickly shooed a group at the Tillman's Corner Wal-Mart off the company's parking lot, protestors here say they wanted to stage a prayer vigil to bring to light what they see as Wal-Mart's "anti-family policies" and "immoral business practices."

Issues, according to opponents, such as low wages that don't keep pace with the cost of living, poor health care coverage and a punitive absentee policy.

Seven days in six months, if you have three or four kids, you can use seven days in a hurry, and after seven days, you're gone," said long-time Wal-Mart employee Brenda Stringfellow. "There's no negotiation. You are gone."

The local vigil was one of dozens taking place this week, organized by a faith-based non-profit called "Wake-up Wal-mart," which is asking Wal-Mart to change its policies by Christmas Day.

"This happens nationwide," said Donald Wright of Wake-up Wal-Mart. "A company making just over $11 billion in profits can't afford to take care of its associates? That is atrocious."

Equally atrocious, according to this group: Wal-Mart's health care coverage, which critics contend does not adequately cover its employees. "Things like that impact the community by the drain on our tax dollars to cover what their insurance doesn't pay for," added Wright.

These protestors say that many more employees wanted to participate, but were afraid of losing their jobs. But Stringfellow, a department manager who's worked for Wal-Mart almost 15 years, says she's not afraid. "I think somebody has to," she added. "If you don't stand up for yourself, who's going to?"

NBC-15 News tried contacting Wal-Mart officials for comment on this story, but has not received any response.

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Leading Retailer's Values Questioned

Gilroy Dispatch (CA)
December 16, 2006                     [back to top]

A dozen people, shivering in winter coats, lit candles Friday night to protest labor policies at Gilroy's Wal-Mart. "It's really shameful that the largest, wealthiest corporation in the world is making its profits on the backs of workers," said Reverend Carol Been, right, of the Interfaith Council on Religion, Race, Economic and Social Justice.

The protesters delivered a letter to Wal-Mart CEO Lee Scott, handing it to store manager Vernon Parker.

"We're busy right now taking care of our customers," Parker told Been.

The vigil was one of more than 40 occurring nationwide Friday, launched by WakeUpWalMart.com and supported by local groups like United Food and Commercial Workers Union (UFCW) Local 428.

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Why an Agency Said No to Wal-Mart

By STUART ELLIOTT
New York Times
December 15, 2006                           [back to top]

A WEEK after stunning Madison Avenue by tossing out the results of a lengthy and expensive search for new advertising agencies, Wal-Mart Stores has decided to ask four of the five finalists from the previous review to take another shot at the $580 million assignment.

One invitee, however, has declared, to borrow an old song title, “Thanks a lot, but no thanks.” The agency is GSD&M in Austin, Tex., part of the Omnicom Group, which has created campaigns for Wal-Mart since 1987.

“I want to thank Wal-Mart for inviting us to re-pitch the business,” Roy Spence, president at GSD&M, said in a statement yesterday. “I have decided to decline.

“We helped build Wal-Mart from $11 billion in sales to $312 billion,” said Mr. Spence, who worked closely for many years with Sam Walton, the founder of Wal-Mart.

“We declare victory,” he added. “And we are moving on.”

The decision by GSD&M leaves three original finalists remaining in the second search, which Wal-Mart hopes to complete before contracts with GSD&M and its other longtime agency, Bernstein-Rein, expire on Jan. 31.

“We expect to complete the review fairly quickly and have something to announce after the first of the year,” said Linda Blakley, a Wal-Mart spokeswoman in Bentonville, Ark.

The other finalist not participating in Round 2 is Draft FCB in Chicago, part of the Interpublic Group of Companies, which Wal-Mart selected in late October as one of its two new agencies, along with Carat USA in New York, part of the Aegis Group. The agency changes were part of a strategy shift at Wal-Mart, the nation’s largest retailer, to compete more effectively against rivals like Kohl’s, J. C. Penney and Target.

Wal-Mart shocked the ad industry Dec. 7 by disclosing that it would cancel the results of the review and bar Draft FCB from participating in the new selection process. The change of corporate mind came three days after Wal-Mart fired two marketing executives, Julie Roehm and Sean Womack, who were instrumental in determining the outcome of the first review.

Wal-Mart dismissed Ms. Roehm and Mr. Womack, who worked for her, after deciding they had a personal relationship that violated ethics policies against fraternizing with subordinates, according to people briefed on the matter. Ms. Roehm, who was senior vice president for marketing communications, and Mr. Womack, who was vice president for brand architecture, have denied any wrongdoing. The two executives, both of whom are married, described their relationship as professional and not personal.

Wal-Mart also determined that Ms. Roehm had violated company policy, these people said, by accepting gifts, including meals, from the agencies taking part in the review. Ms. Roehm denied that last week, saying, “We showed no favoritism.”

When Wal-Mart told executives at Draft FCB they could not participate in the second review, the company told executives at Carat USA they would be invited back. The executives at Carat USA, which specializes in media planning and buying, accepted the invitation.

The two other finalists that agreed to come back are the Martin Agency in Richmond, Va., another Interpublic agency, which creates campaigns for advertisers like Geico and the Newspaper Association of America, and Ogilvy & Mather Worldwide in New York, part of the WPP Group, which creates ads for marketers like American Express and I.B.M.

The short amount of time before the expiration of the Wal-Mart contracts with its current agencies, as well as the burden upon the other agencies of working on second presentations during the holiday season, contributed to the decision by Wal-Mart and its consultant in the search, Select Resources International, to invite previous participants rather than expand the field.

There had been debate inside GSD&M about whether to take part in the second review if invited to do so, according to agency executives familiar with the discussions, who spoke on the condition of anonymity because they were not authorized to speak publicly.

On one side of the ledger were the long, strong ties between GSD&M and Wal-Mart, the executives said, and the possibility the agency could fight its way back onto the roster with Draft FCB out of the picture.

On the other side, the executives said, were factors that included a reluctance to subject employees to another arduous review, particularly around the holidays, and feelers the agency has already received from other retailers.

Ms. Blakley of Wal-Mart, asked for a reaction to the GSD&M decision, replied: “We appreciate the many years of marketing work we did together. We wish them well.”

There was also a lively discussion inside Interpublic about whether Martin ought to take part in Round 2 if asked back, according to executives there who spoke anonymously for the same reason as the GSD&M executives.

On the one hand, the executives said, Interpublic is reluctant to risk a second high-profile repudiation if Martin is not picked again. Interpublic managers had red faces after Wal-Mart called off the decision to hire Draft FCB. Although no contract had been signed, they had ardently celebrated the assignment as a sign that comeback efforts at Interpublic, plagued by account losses and accounting irregularities, were bearing fruit.

(One example of the fallout for Interpublic from Wal-Mart’s decision was a decision by the editors of the trade publication Advertising Age, who had selected Draft FCB as 2006 agency of the year, to rescind their choice.)

On the other hand, the executives said, as stewards of a publicly traded company, Interpublic managers cannot allow wounded pride to overrule their duty to shareholders to pursue new business. Interpublic shares fell 6.4 percent on Dec. 7 after Wal-Mart declared the review would be done over; they closed yesterday at $11.95, up 0.4 percent, or 5 cents, in trading on the New York Stock Exchange.

In the meantime, Bernstein-Rein and GSD&M are continuing to work for Wal-Mart as the retailer seeks to stimulate sluggish sales growth during this crucial shopping season.

“The Christmas and holiday marketing plans were developed some time ago and we have a strong marketing team executing on those plans,” Ms. Blakley of Wal-Mart said.

Bernstein-Rein is leading the effort on a big holiday campaign carrying the theme “Be bright,” which began with ads that sought to burnish Wal-Mart’s image as a place to buy better-quality, pricier products like flat-screen TV sets and home furnishings by the designer Colin Cowie.

The initial “Be bright” ads did not include prices for the merchandise or play up Wal-Mart mainstays like rollbacks, the company’s term for price cuts. John Fleming, chief marketing officer at Wal-Mart, subsequently decided the ads ought to address the longtime Wal-Mart selling point of lower prices.

As a result, ads scheduled to appear this weekend in publications like Parade will present prices along with the merchandise.

Bernstein-Rein, based in Kansas City, Mo., has worked for Wal-Mart since 1974. The agency was eliminated from the first review in August, during an early winnowing of the field. There had been speculation in recent days about an invitation to participate in the second round.

But after discussions between Bernstein-Rein executives and Mr. Fleming, it was determined that “for both of us, it wasn’t in the best interest going forward” for the agency to try again, said Neil Neumeyer, a spokesman at Bernstein-Rein.

“Ever since Aug. 8, when we first heard the news, we’ve been moving on,” Mr. Neumeyer said. “Now, we can continue to do that.”

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Vigil targets Wal-Mart work conditions

About 25 attend in Henrico; other group cites retailer's support

By Greg Edwards
Richmond Times-Dispatch
December 15, 2006                             [back to top]

About 25 people prayed and marched by candlelight at a Wal-Mart last night, asking the company to improve working conditions. The United Food and Commercial Workers Union and central Virginia chapters of the Southern Christian Leadership Conference organized the event at the Brook Road store in Henrico County. Ralph Ramirez, the local SCLC president and a union member, said Christmas is a good time to draw attention to family issues.

The Richmond march was one of several the union is holding around the country to pressure Wal-Mart to improve worker policies and conditions, said Jim Hepner of Stafford, also an SCLC officer and union member.

"I don't believe [retail chain founder] Sam Walton would shop there and support Wal-Mart, the way they treat their employees," Hepner said. "[Walton] was a family-values man."

Working Families for Wal-Mart, a group supported by the world's largest retailer, released a poll yesterday that said a majority of voters in Ohio believe Wal-Mart has a positive effect in their state. It confirms national polls that show Americans believe Wal-Mart is good for their communities, the group said.

Wal-Mart defends its policies on www.walmartfacts.com, its Web site. The company says it offers an average wage of between $10 and $11 per hour, low-cost health-care coverage and a chance for advancement.

The union has its own Web site at www.wakeupwalmart.com, which describes why it feels the company needs to change.

The Rev. J. Rayfield Vines Jr., president of the Henrico County NAACP, led the prayers in that regard at last night's vigil.

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Wal-Mart Critics Hold Vigil In Little Rock

By Alyson Courtney
KTHV (Little Rock)
December 15, 2006                            [back to top]

A group of Wal-Mart critics gathered at the Wal-Mart Supercenter on Baseline Road in Little Rock. They held a candlelight vigil and prayer service in protest of what they call Wal-Mart's anti-family practices. About 30 people gathered in the store parking lot. This vigil coincides with the release of a new WakeUpWalMart.com campaign.

The critics gathered there, including two pastors, believe it will have an impact on customers and the company.

A Wal-Mart spokesperson responded Friday, saying the company offers their associates job opportunity and affordable health care, including health plans that cost as little as $11 per month in some areas and include $3 co-pays and no lifetime max.

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Protesters demonstrate outside north west side Wal-Mart

By Steve Jefferson
NBC 13
December 15, 2006                         [back to top]

Indianapolis - Indianapolis is one of several cities across the country in which Wal-Mart stores were targeted by demonstrators Thursday. The protesters say they were there on behalf of Wal-Mart employees. Jeff Kimbrough is a "Wake Up Wal-Mart" Organizer. He told Eyewitness News, "People without adequate health care. They pay poverty wages and that's not the thing to do at Christmas time."

The protestors' signs stated their purpose. They read "Change Wal-Mart - Change America."

As holiday shoppers streamed toward the front door, the demonstrators listened to speeches. Some even yelled to get their point across.

Paul Kincer, a labor union member for about 30 years, wanted his voice heard during what he called the "Wake Up Wal-Mart" rally. "Maybe (we can) bring awareness to American people, you know, and it actually brought some to myself."

The protest soon got the attention of store managers. Although they declined comment about the demonstration, they did call sheriff's deputies. In fact, police were dispatched on a report of "trouble with a person" just before 6:00 Thursday evening.

Sheriff's deputies arrived shortly after that. One of the deputies addressed organizers. "Wal-Mart says you don't have a right to be on their property and they have a right to say leave the property."

Organizers admit they never got Wal-Mart's permission to be on Wal-Mart property. They agreed to end their demonstration if told by sheriff's deputies.

Organizer Jeff Kimbrough said, "We are going to demonstrate peacefully and we are going to get our message across."

The demonstration eventually ended without incident. But organizers vow their campaign is far from finished.

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Group prays Wal-Mart will raise workers’ pay

Organization holds vigil outside store to promote better wages, benefits

By Delawese Fulton
The State
December 14, 2006                       [back to top]

A national organization that claims Wal-Mart treats its workers unfairly held a prayer vigil Wednesday afternoon in Columbia and in more than 40 other U.S. cities The Association of Community Organizations for Reform Now (ACORN) members, volunteers and residents prayed Wal-Mart would work to better its pay and health benefits by Christmas Day.

A group of seven — residents, volunteers and members of the South Carolina Chapter of ACORN — prayed Wednesday afternoon in the parking lot of the Wal-Mart Supercenter on Forest Drive.

“Father God, remember the weak and the poor this holiday season ... We pray for workers who struggle to make ends meet,” said Tom Wall, a local minister.

Francean Lott, a Columbia resident and ACORN member, said she has never worked for the Arkansas-based retailer. However, her empathy for those who do motivated her to participate in the vigil.

“I care about the people who work for them — single moms and retired personnel,” Lott said. She said for Wal-Mart to be such a profitable company, its employees need more affordable health plans and better pay.

Chris Kofinis, national spokesman for ACORN and WakeUpWalMart.com, said Wal-Mart’s health insurance plans with deductibles as high as $3,000, associates with earnings near poverty levels and restrictions and penalties for employee absences have hurt the retailer’s 1.3 million workers.

David Tovar, director of media relations for Wal-Mart, said the group’s comments and actions are not deserved.

“Our critics continue to focus on negative tactics and antics,” he said. “The fact is Americans know Wal-Mart is good for thousands of families.”

Tovar said the No. 2 Fortune 500 company creates thousands of jobs each year. He said health insurance is provided to full-time and part-time workers after six months and a year, respectively.

“Alot of our competitors don’t do that,” Tovar said, adding that the company’s “value plan” health insurance has premiums as low as $11.

Tovar said just as Wal-Mart shoppers in South Carolina and other states benefit from its $4-generic drug plan so does its employees.

As of November, Wal-Mart employed 25,551 associates in South Carolina, according to Marisa Bluestone, another Wal-Mart spokesperson.

And the average wage for regular, full-time hourly associates in South Carolina is $10.30 a hour. Also, associates are eligible for performance-based bonuses, she said.

The WakeUpWalMart.com site reports that the average Wal-Mart associate earns about $17,000. The average two-person family needs close to $28,000 for basic needs, its researchers found.

As car after car turned into the Forest Drive Wal-Mart store, Lott tried to give each driver a flier about the vigil.

She said her hope is that the company uses its billions of dollars in profits to make life more affordable for its workers.

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Wal-Mart Speeds Clicks as Web Margins Lure Retailers

By Andria Cheng
Bloomberg                          [back to top]

Dec. 14 (Bloomberg) -- Wal-Mart Stores Inc. has simplified its Web site so customers can get to the checkout page in fewer than four clicks. Federated Department Stores Inc. plans to open a distribution center next year dedicated to online orders.

These and other retailers are pushing Internet sales this holiday season with Web site overhauls and increased investment -- and for good reason.

Traditional retailers generated a 28 percent average operating profit margin from their Web sites in 2005, according to a Forrester Research Inc. study for the National Retail Federation. That's at least double the overall margin for warehouse clubs, discounters and department stores, according to Deloitte & Touche USA LLP. And while online may have its limits compared with in-person shopping, retailers say a strong Web presence will boost earnings.

``These are very profitable sales,'' said Tim Ghriskey, who helps manage more than $1 billion at Bedford Hills, New York- based Solaris Asset Management, including retail shares. ``There are fewer human hands involved. Labor costs are a huge expense for retailers. You don't have to expand stores. All you need is a continuously slicker-looking and easier-to-use Web site.''

Eighty-eight percent of traditional retailers said their Web unit was profitable in 2005, compared with 70 percent in 2004, according to the study by Cambridge, Massachusetts-based Forrester.

`It's Convenient'

Retailers' Web traffic is growing faster than online-only stores. From the week ended Nov. 5 to the week through Nov. 26, traffic to the Wal-Mart, Target Corp. and Best Buy Co. sites more than doubled, while traffic at Amazon.com Inc., the world's largest Internet merchant, rose 15 percent, according to ComScore Networks Inc., a Reston, Virginia, research firm.

``It's convenient,'' said Cincinnati homemaker Karen Zedeker as she stood outside a Bloomingdale's store in Manhattan. ``I look for bargains and see who's got the best price. It's nice they deliver to your homes.''

Zedeker, 57, said she plans to spend about $2,000, or half her holiday budget, on the Web, up from a third last year.

Wal-Mart's Web redesign this year provided greater ease-of- use. It eliminated an average of two clicks to get to the checkout page while adding interactive features to about 5,000 pages so users won't have to navigate to another page to get product information.

Walmart.com projects site visits will surge 40 percent to 700 million in 2006, spokeswoman Amy Colella said.

Retailers have increasingly shipped merchandise from their suppliers, boosting profit by eliminating the need to stock inventory, said Sucharita Mulpuru, an analyst who wrote the Forrester study. They've also contracted management of Web sites and customer service to other firms to save money, she said.

$130 Million Investment

Federated, the second-largest U.S. department-store company and owner of Macys.com, forecasts that its annual online sales will more than double to $1 billion in the next few years. It also plans its biggest-ever capital investment in the online unit -- $130 million this year and next -- as it opens the distribution center in Portland, Tennessee.

``At some point in the future, direct shipping from some suppliers might make sense,'' said Federated spokesman Jim Sluzewski. ``Not many of our vendors are set up to do that.''

For now, Federated is focusing on speed and efficiency, he said.

Shares of Cincinnati-based Federated have gained 19 percent this year, compared with a 12 percent increase in the 29-member Standard & Poor's 500 Retailing Index and an 17 percent decline at Seattle-based Amazon.

Holiday Internet Sales

Overall profit margins at warehouse clubs, discounters, consumer electronics retailers and department stores ranged from 4.9 percent to 10.9 percent in the year through January 2005, according to New York-based Deloitte & Touche.

Internet sales in November and December will probably climb 24 percent to $24.3 billion this year, according to ComScore. Total holiday sales, excluding online shopping, will increase 5 percent to $457.4 billion, said the Washington-based National Retail Federation.

``We've seen nothing but growth,'' said Sharen Turney, chief executive officer of Victoria's Secret, Columbus, Ohio- based Limited Brands Inc.'s largest chain. She said third- quarter sales from the Web site and catalogs surged 20 percent.

In October, Beaverton, Oregon-based Nike Inc., the world's largest athletic-shoe maker, created a senior position reporting to the CEO to oversee its Web sales. Nike also revamped its site to enable faster downloads and checkouts.

Beyond profit, retailers are using the Internet to test demand. Abercrombie & Fitch Co. checked its international Web orders as it prepared to open its first European shop, in London.

Peak Predicted

Retailers' investments in Internet sites may only take them so far. Online sales, which are expected to break the $100 billion mark this year, represent less than 10 percent of total retail revenue and will reach no higher than 15 percent, according to Jupiter Research. Shoppers still want to be with people, see merchandise and try on clothing, according to the New York-based market research firm.

Online divisions also have to cope with a higher rate of product returns than their traditional counterparts.

An average 20 percent of Web purchases are returned, said Ken Johnson of Austin, Texas-based Newgistics, a processor of direct returns for retailers. A return costs retailers about $25 to $35, on average, he said.

Retailers may also find themselves victims of their own success. Wal-Mart's Web site crashed the day after Thanksgiving in a wave of Internet bargain hunting.

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'Would Jesus Shop at Wal-Mart' Questions Worker Treatment at Chain

Associated Press
Thursday , December 14, 2006                      [back to top]

LITTLE ROCK — A new television ad by the union-backed group WakeUpWalMart.com features a pastor asking, "Would Jesus shop at Wal-Mart? Should you?"

Accompanying the ad, is a letter to Wal-Mart Stores Inc. Chief Executive Officer Lee Scott that was signed by more than 130 clergy members. The letter asks Wal-Mart (WMT) to provide a "higher standard for its employees and their families," which the letter says would reflect "the best of Christian values."

WakeUpWalMart.com provided the ad to The Associated Press on Wednesday and said the spot is to run in 43 media markets.

Pastor Joe Phelps of Highland Baptist Church in Louisville, Ky., asks in the ad, "can we continue to shop at Wal-Mart without insulting God?" He lists allegations that Wal-Mart has violated child labor laws and engaged in gender-based discrimination and says half the company's 1.3 million U.S. employees aren't covered under the company health plan.

Wal-Mart spokesman Dave Tovar said the United Food and Commercial Workers International Union is backing negative attacks while the Bentonville-based retailer is creating jobs.

"The fact is, union leadership is wasting millions of its members' dollars on a failing campaign against a company that is good for working families," Tovar said.

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Wal-Mart recalls 56,000 toy dogs

Stuffed Christmas beagles present choking hazard; no injuries, incidents have been reported.

Reuters
December 14 2006                [back to top]

NEW YORK (Reuters) -- Wal-Mart Stores Inc. has voluntarily recalled about 56,000 stuffed toys due to a possible choking hazard to young children, the U.S. Consumer Product Safety Commission said Thursday.

No incidents or injuries have been reported, the statement said.

The stuffed Christmas beagles, priced at about $3, were sold at Wal-Mart stores nationwide from September 2006 through December 2006.

The group said the red pompoms on the wreath attached to the beagle's mouth could detach, posing a choking hazard.

Shares of Wal-Mart (up $0.44 to $46.34, Charts) rose less than 1 percent in morning trade on the New York Stock Exchange.

Shares of Target (up $0.79 to $59.29, Charts), one of Wal-Mart's biggest competitors, edged lower while rival discounters Walgreen's (up $0.48 to $44.58, Charts) and CVS (up $0.59 to $30.90, Charts) edged higher in New York.

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Wal-Mart Completes Biggest Sale of Bonds in Pounds Since 2001

By John Glover
Bloomberg                               [back to top]

Dec. 13 (Bloomberg) -- Wal-Mart Stores Inc., the world's biggest retailer, completed a sale of 1 billion pounds ($1.96 billion) of bonds, the biggest sale of company debt in the U.K. currency since 2001.

The bonds, due in January 2039, will pay a yield of 88 basis points more than U.K. government bonds, compared with the 90 to 94 basis points at which the debt was initially marketed. The sale brings the total bond debt the Bentonville, Arkansas-based company has outstanding in the U.K. currency to about 3 billion pounds, with 2.5 billion pounds due in 2030 or later, data compiled by Bloomberg shows.

The debt is rated AA, the third-highest level, by Standard and Poor's and Fitch Ratings, and an equivalent Aa2 by Moody's Investors Service. The transaction matches the 5.25 percent bonds due 2033 that GlaxoSmithKline Plc, Europe's largest drugmaker, sold in 2001, in size, as well as Wal-Mart's own 2004 deal, and only types of asset-backed sales in pounds have been bigger.

Citigroup Inc., Goldman Sachs Group Inc. and Morgan Stanley managed the sale.

Wal-Mart owns Asda, the U.K.'s second-largest grocer.

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Union-backed group enlists preacher in new anti-Wal-Mart Stores ad

By: The Canadian Press
December 13, 2006                            [back to top]

LITTLE ROCK (AP) - A new television ad by the union-backed group WakeUpWalMart.com features a pastor asking, "Would Jesus shop at Wal-Mart? Should you?"

Accompanying the ad, is a letter to Wal-Mart Stores Inc. chief executive officer Lee Scott that was signed by more than 130 clergy members. The letter asks Wal-Mart to provide a "higher standard for its employees and their families," which the letter says would reflect "the best of Christian values."

WakeUpWalMart.com provided the ad to The Associated Press on Wednesday and said the spot is to run in 43 media markets.

Pastor Joe Phelps of Highland Baptist Church in Louisville, Ky., asks in the ad, "can we continue to shop at Wal-Mart without insulting God?" He lists allegations that Wal-Mart has violated child labour laws and engaged in gender-based discrimination and says half the company's 1.3 million U.S. employees aren't covered under the company health plan.

Wal-Mart spokesman Dave Tovar said the United Food and Commercial Workers International Union is backing negative attacks while Wal-Mart is creating jobs.

"The fact is, union leadership is wasting millions of its members' dollars on a failing campaign against a company that is good for working families," Tovar said.

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Wal-Mart ad search, Take 2

By Laura Petrecca,
USA TODAY
12/13/2006                               [back to top]

Madison Avenue CFOs got an unexpected holiday gift: A big chunk of business is back on the table. Wal-Mart Stores (WMT) has put up for grabs again its $580 million ad account, which was just awarded in October to ad agency DraftFCB and media-buying firm Carat USA.

Last week, Wal-Mart not only ditched the agencies that were picked after an arduous, six-month review competition, it also fired two of its executives who helped run that competition: Julie Roehm, senior vice president of marketing communications, and Sean Womack, vice president of communications architecture. Wal-Mart has yet to disclose the reason for the moves other than to issue a statement citing "new information."

Finalists from the last round of the competition will be notified this week about "who is eligible" to pitch in the new contest and how Wal-Mart will run the new review, which it plans to conclude by Feb. 1, spokeswoman Mona Williams says. She wouldn't say if additional ad firms also will be invited.

DraftFCB is not being invited to re-pitch. Carat, however, will get another shot.

Roehm, an aggressive marketer who came to Wal-Mart from DaimlerChrysler in January, supervised the original review. She had come in with a mandate to add pizazz to Wal-Mart's marketing and help expand its customer base beyond just price-conscious shoppers.

Roehm, in a telephone interview, says she does not know why Wal-Mart dismissed DraftFCB and Carat, but added that a marketing review process "can be uncomfortable for a conservative company."

She wouldn't offer specifics on her departure, but did say: "People have cultures, as do companies. Depending on strategy and needs, they either fit or they don't."

The earlier review was Wal-Mart's first time running an ad agency selection competition. Its previous ad shops, Bernstein-Rein and GSD&M were handpicked by previous Wal-Mart management.

GSD&M, The Martin Agency and Ogilvy & Mather were the recent review's other finalists.

Since Roehm's start at Wal-Mart, many in the industry questioned if a marketer with a reputation for being brash and outgoing would be accepted at the retail behemoth known for its buttoned-up culture. A story on the cover of trade publication Advertising Age was headlined: "Will She Fit In?"

There now are indications that she didn't. For instance, during the review, Roehm invited agency executives to an Eagles concert and attended agency-sponsored events, including a party hosted by DraftFCB at swanky New York City sushi restaurant Nobu.

The latter event raised questions about whether it violated Wal-Mart's strict ethics policy that forbids employees from accepting anything — even a cup of coffee — from suppliers or potential suppliers. Roehm says she paid for her own drinks at the Nobu event and expected DraftFCB to bill Wal-Mart for the food.

She also says that mingling with DraftFCB executives and those from other ad agencies is part of the marketing business. "You have breakfast, lunches and dinners and get to know people on a personal level to make sure they could work well with the Wal-Mart team back at home," she says.

Roehm defends the first agency go-around. "The review went well," she says. "We worked hard to find a right partner."

She says that selecting a new ad agency is like buying a new pair of leather shoes that are tight, and someone can decide to break them in or take them off.

While Wal-Mart plans to replace Roehm and Womack, Chief Marketing Officer John Fleming will oversee the new agency selection.

For the holiday season underway, Williams says Wal-Mart's advertising will focus on "price leadership on the hottest gifts." Current ads include one about a frugal dad who is happy that his family buys gifts at Wal-Mart.

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Tell Wal-Mart to Stop Promoting the Religious Right's Violent Ideology

by DefCon America                             [back to top]

Just in time for Christmas, elements of the religious right have released a violent video game ("Left Behind: Eternal Forces") in which born-again Christians aim to convert or kill anyone who doesn't adhere to their ideology. Disturbingly, the game's apparent attempts at religious indoctrination are aimed at children and focus on violent, divisive, and hateful scenarios.

Gamers are charged with creating Christian militias who roam the streets of New York City, looking to convert non-believers and killing those who they are unable to draw to their side. In fact, after particularly bloody battles, players must use prayer to recharge their "soul points" that have been diminished by the killing.

The game is no cultural anomaly, but part of a general pattern in which some parents on the Christian right are socializing children with the vocabulary of violence and the expectation that they will wage religious warfare, against specified societal groups, within their lifetimes. That was the context for the recent documentary Jesus Camp, and "Jesus Camp" is part of a wider societal phenomenon.

While the game publisher apparently has no problem making money on religious violence this holiday season, Wal-Mart - who is America's #1 video game seller -- should know better.

Call to action: Tell Wal-Mart to stop selling religious violence this holiday season.

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Wal-Mart's Elmo Offering 'Tickles' Shoppers' Fancy, But Raises Some Eyebrows

FOXNews.com
Tuesday , December 12, 2006                            [back to top]

Wal-Mart (WMT) appeared to have pulled off a holiday season coup on Tuesday when the company said it would sell thousands of hard-to-find Elmo T.M.X. dolls online for four days this week.

"We're very excited to surprise our customers with one last, big opportunity to purchase the hottest toy of the year — Elmo T.M.X.," said Mike Simas, Walmart.com's vice president of merchandising, in a press release.

The $40 T.M.X. Elmo is one of the most in-demand gifts of the year. The furry, red Sesame Street character — who laughs and kicks his feet when tickled — has proven a popular pick with parents and children this holiday season.

Soon after the doll’s much-anticipated September release many toy retailers, including Wal-Mart, broke the news to T.M.X. hunters that Elmo was out of stock.

But Wal-Mart’s most recent announcement has raised suspicions that the world's largest retailer may have hoarded the dolls and timed their release for the prime-shopping season.

The company says that is not the case.

When asked how Wal-Mart.com got its hands on such a large quantity of the much-sought-after toy with less than two weeks to Christmas, company spokeswoman Amy Colella told FOXNews.com, "We recently secured the additional [Elmo dolls]."

FOXNews.com's Heather Scroope and Catherine Donaldson-Evans contributed to this report.

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'Convert or die' game divides Christians Some ask Wal-Mart to drop Left Behind

By Ilene Lelchuk
San Francisco Chronicle
December 12, 2006                                [back to top]

Liberal and progressive Christian groups say a new computer game in which players must either convert or kill non-Christians is the wrong gift to give this holiday season and that Wal-Mart, a major video game retailer, should yank it off its shelves. The Campaign to Defend the Constitution and the Christian Alliance for Progress, two online political groups, plan to demand today that Wal-Mart dump Left Behind: Eternal Forces, a PC game inspired by a series of fictional Christian novels that are hugely popular, especially with teens.

The series by Tim LaHaye and Jerry Jenkins is based on their interpretation of the Bible's Book of Revelation and takes place after the Rapture, when Jesus has taken his people to heaven and left nonbelievers behind to face the Antichrist.

Left Behind Games' president, Jeffrey Frichner, says the game actually is pacifist because players lose "spirit points" every time they gun down nonbelievers rather than convert them. They can earn spirit points again by having their character pray.

"You are fighting a defensive battle in the game," Frichner, whose previous company produced Bible software, said of combatting the Antichrist. "You are a sort of a freedom fighter."

A Wal-Mart spokeswoman said the retailer has no plans to pull Left Behind: Eternal Forces from any of the 200 of Wal-Mart's 3,800 stores that offer the game, including just seven in California. The nearest are in Chico and Redding.

"We look at the community to see where it will sell," said Tara Raddohl. "We have customers who are buying it and really haven't received a lot of complaints about it from our customers at this time."

Clark Stevens, co-director of the Campaign to Defend the Constitution, said the game is not peaceful or diplomatic.

"It's an incredibly violent video game," said Stevens. "Sure, there is no blood. (The dead just fade off the screen.) But you are mowing down your enemy with a gun. It pushes a message of religious intolerance. You can either play for the 'good side' by trying to convert nonbelievers to your side or join the Antichrist."

The Rev. Tim Simpson, a Jacksonville, Fla., Presbyterian minister and president of the Christian Alliance for Progress, added: "So, under the Christmas tree this year for little Johnny is this allegedly Christian video game teaching Johnny to hate and kill?"

Both groups formed in 2005 to protest what their 130,000 or so members feel is the growing political influence and hypocrisy of the religious right.

In Left Behind, set in perfectly apocalyptic New York City, the Antichrist is personified by fictional Romanian Nicolae Carpathia, secretary-general of the United Nations and a People magazine "Sexiest Man Alive."

Players can choose to join the Antichrist's team, but of course they can never win on Carpathia's side. The enemy team includes fictional rock stars and folks with Muslim-sounding names, while the righteous include gospel singers, missionaries, healers and medics. Every character comes with a life story.

When asked about the Arab and Muslim-sounding names, Frichner said the game does not endorse prejudice. But "Muslims are not believers in Jesus Christ" -- and thus can't be on Christ's side in the game.

"That is so obvious," he said.

Left Behind is a real-time strategy and adventure game. Players don't role-play like in Grand Theft Auto -- it's more like the board game Risk than Clue.

Frichner said more than 10,000 retailers -- including Sam's Club, Target, Best Buy, Circuit City, GameStop, EB Games and various Christian stores -- offer the game. He said sales are terrific, though he wouldn't reveal figures.

Protesters are targeting Wal-Mart, where the game retails for $39.96, because it is one of the biggest video game sellers in the United States.

More than 60 million copies of books in the series have sold since the first volume came out in 1996.

Jeff Gerstmann, senior editor at the online publication Gamespot.com, said the game isn't popular. The game itself, which Gamespot rated 3.4 out of a possible 10, has lots of glitches.

"And it's kind of crazy," Gerstmann said. "One of the evil characters is a rock musician. ... If you get too close to him your spirit is lowered."

But Plugged In, a publication of the conservative Christian group Focus on the Family, gave the game a "thumbs-up." The reviewer called it "the kind of game that Mom and Dad can actually play with Junior -- and use to raise some interesting questions along the way."

Frichner said that is precisely his company's ultimate goal in offering the game: to bring parents and kids together to talk about the Bible. He said most teens are playing video games, so it was natural to turn the books into one.

His business partner, Troy Lyndon, created Madden Football, one of the top-selling sports video games. Left Behind Games Inc. is based in Murrieta (Riverside County).

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So, What if Wal-Mart Made a Mistake?

by Jim Goodman
Tuesday, December 12 2006                [back to top]
 

That was the question asked by the host on a recent Public Radio call-in show. Her question to her guest from the Cornucopia Institute was in regard to recent charges that Wal-Mart was passing conventional grocery items off as USDA certified organic.

A mistake? I doubt it. Seriously, think about it, you start a big push in marketing a new line of high profit products and one of the first things you do is mislabel your products, “accidentally”? As Jim Hightower would say “Do they think we were born with sucker wrappers around our heads?”

Ever since Wal-Mart announced earlier this year that they planned to greatly increase their organic offerings at a cost of only 10 percent more than their conventional foods, those of us who grow organic food have been skeptical.

Now it appears our skepticism was well placed. I personally felt the worst we might expect would be imports of cheap “organic” food from China, but hey, why not go for the gold, just sell conventional food as organic.

There was much excitement about Wal-Mart expanding their organic sales and how it would do so much to help organic farmers, huh? did Wal-Marts entrance into the conventional grocery business help conventional farmers, did their profits go up? Hardly, but it did put lots of small grocery stores out of business and certainly added more black ink to Wal-Marts multi-billion dollar bottom line.

In its short history as an organic retailer Wal-Mart is already under scrutiny for sourcing its organic milk from a factory scale dairy that is under investigation by the USDA for failing to comply with federal organic regulations. It would also appear that they have no qualms about selling organic produce from China as long as it's cheaper and more profitable than sourcing from the US, but then Wal-Mart is an old hand at offshore sourcing, just ask the US textile industry they helped ruin.

I wonder if a Wal-Mart mistake was the reason 1.6 million women have joined in a civil rights lawsuit against Wal-Mart? This action, now the largest class-action lawsuit in history charges Wal-Mart with sex discrimination in pay and promotions.

When an Oregon jury found Wal-Mart guilty of systematically forcing workers to work overtime without pay, the evidence obviously pointed to more than just a “mistake” on the part of Wal-Mart.

On 10 separate occasions the National Labor Relations Board has ruled that Wal-Mart broke the law when it fired union supporters. A mistake, or are they just slow learners?

“A pattern of national disregard by Wal-Mart” was how Connecticut Attorney General Richard Blumenthal described the company's adherence to environmental protection laws. More mistakes, or just their way of doing business?

In Wal-Marts tightly structured business model everything is controlled (down to the temperature and in-store music) from the head office in Bentonville Arkansas. The home office knows exactly whats going on in the stores and they certainly didn't become the worlds largest retailer by making mistakes.

Everyday Low Prices, the Wal-Mart slogan, wins the hearts of many because “poor people can afford to shop there”. Those low prices are kept low by the exploitation of international sweatshop laborers, driving competitors out of business and paying their associates wages so low they must turn to Medicaid for health insurance and often buy their cloths at Goodwill.

Wal-Mart does have a history, a history of low wages, union busting, sweatshop exploitation, discrimination and doing whatever it takes to make a profit. So what's a little mislabeling? Like many of their business practices, a big mistake, but their most consistent mistake is thinking they can get away with it.

A caller to that same radio program asked the guest why he was picking on Wal-Mart. While the guest correctly focused on examples of Wal-Marts unethical and illegal behavior, in particular their flouting of organic standards, my answer would have been shorter, we're not picking on them, they're picking on us.

Jim Goodman is a dairy farmer from Wonewoc, WI

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Town unites to keep store open

By Judy Keen
USA TODAY
12/11/2006                 [back to top]

ANITA, Iowa — Bob Matthies walked two blocks from home to the Main Street Market to pick up coffee and ground beef. He no longer takes the easy trip for granted. The only grocery store in this town of 1,100 was on the verge of closing last month. Residents agreed it had to be saved, so they formed a cooperative and sold shares for $200 each to keep it open. Losing the store would have been "one or two steps below losing the school," says Matthies, 55.

The co-op board has raised more than $40,000 of its $50,000 goal by selling shares. That money and $150,000 in loans enabled the board to buy the store, pay eight employees and stock the shelves. The co-op warned investors they "probably won't see a return on their money," board President Don Karns says. "They got involved because they know we need the store."

Until the 1960s, Anita had five family-owned groceries. The Main Street Market, which has occupied the ground floor of a brick building since around 1900, is the sole survivor. Competition is from a gas station/convenience store a few blocks away and from three big grocery stores — including a Wal-Mart Supercenter that opened last year — 12 miles away in Atlantic.

William Kennedy, 55, stops at the Main Street Market every day or two. He shops reluctantly in Atlantic for items such as odd-sized light bulbs. "I only go to Wal-Mart as a last resort," he says. "I don't believe in corporate enterprises because they drive out family businesses."

Wal-Mart spokesman Dave Tovar says, "Working families shop at Wal-Mart because they like the service our associates provide, and they can buy the products they need at affordable prices in one convenient place." Tovar says Wal-Mart donated more than $53,000 in this area last year, including $1,000 to support Anita's teacher-of-the-year program.

Keeping prices competitive

Linda Harms, the new general manager of the Main Street Market, plans to keep prices of staples such as coffee and laundry soap competitive with Wal-Mart and grocery chains Hy-Vee and Fareway in Atlantic. "People's perception is that our prices are higher," she says.

Last week, a dozen eggs cost $1.16 at Wal-Mart, $1.39 in Anita. A gallon of milk was $2.29 at Wal-Mart and $2.95 in Anita. The Wal-Mart in Atlantic sells much more than groceries, plus there's a Subway sandwich shop, an eyeglass shop, a beauty salon and a tire/lube express.

The Main Street Market has clerks who know most customers' names, a 50-year-old glass meat counter with a full-time butcher, racks of rental DVDs and a liquor section. It delivers groceries every Friday, and regular customers can run tabs. Soon there will be a suggestion box so patrons can request that their favorite items be stocked.

Dean Carstens, a member of the co-op board, says the group quizzed area shoppers and found that Wal-Mart customers sometimes have to wait in long lines and dislike scanning their items.

Jim Dory, 68, bought four pork tenderloins at the store here. "I buy meat, milk and everything else I need here," he says. "Wal-Mart is too busy. I can get in and out of this store quicker. It definitely needs to be here."

Plenty of people here, including the co-op board, do shop at Wal-Mart. Karns says they are "staying away from telling people not to go to Wal-Mart."

Many small towns are shrinking as young people move away and residents age. Schools, post offices and businesses close, eliminating reasons for people living on area farms to come to town. Anita, which grew up around a railroad stop and was incorporated in 1875, has fought to prevent that from happening here.

People donated time and money to build a golf course, an airstrip, a nursing home and a library. They lobbied successfully for a state park that brings hundreds of campers to town. They repaired the decaying band shell in the town park. A recreation center is being built.

Results mixed elsewhere

When the grocery crisis happened this fall, people remembered that Fontanelle, a town of 700 about 25 miles southeast of here, had formed a co-op to finance its new grocery store.

After almost a decade with no grocery, Fontanelle sold $250 shares to raise almost $300,000 and opened the Nodaway Valley Market in April. Investors "aren't too worried about making a profit, but business is good," says store manager Tab Rasmussen.

The Nodaway Valley Market also competes with a Wal-Mart. Rasmussen says his customers don't expect to find the same array of merchandise. "Any Wal-Mart is going to hurt you," he says, "but this is a small-town grocer. It's a convenience to the community."

Iowa has about 550 food markets of all sizes, about half of them small independent stores, says Jerry Fleagle, president of the Iowa Grocery Industry Association.

More communities are forming co-ops, he says, because they know that "once a grocery store goes, it's real difficult for all the other businesses in town to survive. The grocery store creates all the traffic."

Some towns that formed co-ops have closed their grocery stores after a year or so, Fleagle warns.

That won't happen here, says Harms, the store manager. "This is a community store now. It's heartwarming to see how people really pull together."

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You won't find this shopper in the aisles of Wal-Mart

Company's reputation is a turnoff, despite the lure of low prices.

By William Moore
Star-Gazette
December 11, 2006                                    [back to top]

Drive along Chemung County Route 64 or Interstate 86 these days, and you'll see a Wal-Mart Supercenter slowly rising from what was once an abandoned food-processing plant. To many passersby, this might be a sign of economic progress. To me, it's a reminder of Wal-Mart's further grip on the American consumer by offering low prices at a high cost to its employees and the community. Media and congressional reports have pointed to how the retail chain has mistreated employees, hurt industry wage standards and put major strains on public health-care programs.

I'll admit that I never liked Wal-Mart stores in the first place, and I certainly don't shop there. However, I can see why some people would because of its low prices and convenience. What some people may not know, however, is that Wal-Mart has developed a notorious reputation for how it has treated employees, having been the target on several occasions of lawsuits.

In 2001, current and former female Wal-Mart employees filed a massive nationwide sex discrimination class action lawsuit in U. S. District Court against Wal-Mart Stores, Inc. The suit is seeking class action status that will make it the largest class action lawsuit ever with more than 1 million participants. Also in 2005 a class- action suit was filed in Los Angeles on behalf of 15 workers in Bangladesh, Swaziland, Indonesia, China and Nicaragua claiming that Wal-Mart ignored inhumane working conditions at many of its suppliers' factories around the world. Each of these incidents is reported on the BBC news Web site.

On another occasion, according to an article in the Wall Street Journal, Wal-Mart agreed to pay $135,540 to settle U.S. Department of Labor charges that the company had violated provisions against minors operating hazardous machinery.

Having employed minors in dangerous jobs and maintained factories with horrible work conditions are bad enough, but the reasons for my not supporting Wal-Mart don't end there.

Employees are not paid well and receive inferior benefits. Wal-Mart pays an average hourly wage of $8.23 an hour, a wage which falls below basic living wage standards as well as poverty lines. According to an article on the PBS Web site, although "Wal-Mart employees start at the same salary as unionized employees in similar lines of work, they make 25 percent less than their unionized counterparts after two years at the job."

In addition, the company's health plan has received close media scrutiny for being inadequate for many employees who can afford it.

The Wall Street Journal reported that in 2002, average spending on health benefits for each of Wal-Mart's covered employees was $3,500, or almost 40 percent less than the average for all U.S. corporations and 30 percent less than the rest of the wholesale-retail industry. Not only does this hurt Wal-Mart employees, but it affects the taxpayer as well.

A November 2004 New York Times article cited a study in Georgia that found thousands of children of Wal-Mart employees were in the state's health care program at a cost to taxpayers of $10 million a year. The same article said a hospital in North Carolina found that 31 percent of its 1,900 patients were Wal-Mart employees on Medicaid, and an additional 16 percent were Wal-Mart employees with no insurance. Also, a study in August 2004 by researchers at the University of California at Berkeley said that the health care expenses of uninsured Wal-Mart employees were costing the state $32 million a year in taxpayer funds.

Because Wal-Mart insists on mistreating its employees, I for one refuse to shop there. The low prices may continue to entice you into going to Wal-Mart but remember that whenever you spend a dollar there, you are supporting a company that could hurt a community as much as it might help it.

William Moore is a student at Elmira Free Academy and a member of the Star-Gazette Youth Editorial Board, which produces its own Opinion page -- ListenUp -- every other Monday.

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Exit of Flashy Marketer Rocks Wal-Mart's World

By Sandra O'Loughlin
and Jim Edwards
December 11, 2006                       [back to top]

NEW YORK -- Wal-Mart's advertising strategy was in disarray last week after the retailer sacked two of its top marketing executives and the lead creative agency it tapped in October.

The moves came after allegations that at least one of the pair—Julie Roehm, svp-marketing communications—violated Wal-Mart's strict ethics policy during its recent review of agencies, which she denies. Wal-Mart CMO John Fleming is now in the difficult position of overseeing a new review for the $570 million account, which the company is trying to wrap up by February.

Insiders say Roehm's taste for sexy ads, fast cars and late nights appears to have been too much for the conservative, buttoned-down Beast of Bentonville.

That culture clash reached its peak at the Sept. 20 Adforum agency consultant conference in New York. With her review of agencies ongoing, Roehm made a speech at DraftFCB's offices in the afternoon, which, despite her disclaimer, appeared to observers to be a glowing endorsement of CEO Howard Draft's operation.

According to multiple executives present, for a client in a major review to give such special treatment to one contender but not the others was a huge faux pas and a breach of review ethics, which requires agencies to be treated equally.

After the speech, in which she praised Draft's new agency model that combines traditional agency creativity with the muscle of a direct-marketer's database operations, Draft hosted 30 or so consultants and Roehm at the nearby Nobu 57, a trendy Japanese restaurant in New York's midtown.

The dinner featured Nobu's "Omakase" six-course tasting menu, which starts at $150 a plate before tax, tips and booze. And booze there was, guests of Draft told Brandweek, in the form of kiwifruit and kumquat martinis. Before the end of the night, Roehm had been photographed sitting in the laps of two of Draft's male guests. The photograph's owner declined to make the images available.

Draft was later spotted paying the check, a potential violation of Wal-Mart's ethics policy, which bars accepting or requesting a "gift or gratuity from a supplier, potential supplier or any person who you believe may seek to influence any business decision or transaction involving Wal-Mart." Examples of verboten gratuities include: "liquor or meals."

In a phone interview Friday, Roehm, 36, who sounded upbeat, said she paid for her drinks but expected to be billed later for the food: "I didn't check into it or check up on it, but I did pay for my drinks. My assumption was that [DraftFCB] would be billing us back." She said she didn't know if that happened.

As for the lap-photo, "It was completely innocuous," she said. "I'm sure I just sat there and was taking a picture with him. I don't recall, but there was nothing, certainly, nothing sexual about any of it."

The events of Sept. 20 were doubly shocking because Wal-Mart executives are renowned for their monkishness when it comes to corporate expenses and gifts. They have been seen paying for drinks at open-bar events and bringing their own food in brown paper bags to catered meals, sources said, in order to stay within their ethics rules.

Sean Womack, Wal-Mart's vp-communications architecture, who departed from the company at the same time as Roehm, also was at the Nobu dinner. Womack told Brandweek that he and Roehm both denied widely published rumors that the pair were having an improper relationship, which would be a violation of Wal-Mart's "fraternization" policy.

"Of course we have a personal relationship because we're friends," Roehm said. "But I think that, what is to be denied, is that there is anything improper about our relationship."

On one level, the rise and fall of Roehm is a case about being careful what you ask for: Wal-Mart hired her at the beginning of the year as it embarked on a massive marketing turnaround aimed at changing its image from a low-end discounter known to be stingy with employee healthcare into an environmentally sensitive company of the future with trendy offerings for upscale shoppers.

Roehm, a former Brandweek Marketer of the Year while at Chrysler, was to be, in her own words, Wal-Mart's "change agent." But the changes may have come too fast. During her 11-month tenure, Roehm proposed abandoning the TV upfront in favor of an eBay-style ad trading system, appeared on Fox News' O'Reilly Factor to defend Wal-Mart's use of the phrase "Merry Christmas," made the gossip columns by inviting contender agencies to an Eagles concert and then telling them they had not won her review, and gave the press details of her inspection of Howard Draft's nonfunctional Aston Martin.

Of course, Roehm's style was no secret when Wal-Mart hired her. It was Roehm who had Dodge sponsor—and then disavow—the "Lingerie Bowl" Super Bowl halftime show in 2004. It was also Roehm who ordered up Chrysler ads in which people alluded to having sex in their cars, and she who was behind a 2003 Dodge Durango spot that featured two men standing at urinals engaging in a double entendre-filled discussion about size. And at industry conferences, such as the 2003 Marketing Forum cruise in New York, it was Roehm who turned heads as she partied late at night in the ship's bar.

She's a force to be reckoned with," said one exec familiar with her. "Fire comes out of her eyes." That level of flamboyance never fit well at the Arkansas big box merchant.

Whether Wal-Mart will continue with its upscale strategy is now in doubt, not least because CEO Lee Scott told analysts in October that the results so far were "mixed." He added, "I think right now it's just choppier than it should be."

DraftFCB had been hired because the agency promised a stream of fresh creative ideas coupled with a formidable direct-marketing data-crunching operation that would measure results down to the level of the individual store.

Wal-Mart has a massive data mining operation of its own, but the emphasis on new creative ideas was a change for a company that had primarily used television advertising to further its folksy image and to tout low prices.

Though DraftFCB is now out of the review, two incumbents—GSD&M in Austin, Texas, and Bernstein-Rein in Kansas City Mo.—along with contenders Ogilvy & Mather in New York and The Martin Agency in Richmond, Va., were in limbo last week, awaiting instructions.

Bernstein-Rein was still working on the client's business and will do so through the end of January. The independent agency's 32-year history with Wal-Mart could play to its advantage.

The agency created Wal-Mart's holiday campaign, a series of 17 spots around the theme "Be Bright" that launched Nov. 1 and will continue with hundreds of creative executions, including network, cable and in-store TV, national print, online and cinema. While its contract is due to expire on Jan. 31, the agency is in talks with the retailer.

We're actively doing their work today," said Kirk Kirkpatrick, svp and creative director. "We know their people and they know us. There would be no start-up time, no lag time, if they just continued with us and frankly with GSD&M as well.

We're hopeful that when they reconsider everything they remember the folks that actually got them there are still on board and are doing a pretty good job for them . . . but we just don't know because they are being pretty tight-lipped about it."

Kirkpatrick may have good reason to be optimistic. Wal-Mart execs were so pleased with a recent 60-second spot that they had added it to its cinema schedule.

That spot will run in theaters nationally beginning Dec. 15. In addition, a third flight of TV ads will break at about the same time, following commercials that launched on Nov. 24.

--with Andrew McMains and Aaron Baar

© 2006 VNU eMedia Inc. All rights reserved.

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Wal-Mart sets terms on 32-yr sterling bond -banker

Reuters
Mon Dec 11, 2006                           [back to top]

LONDON, Dec 11 (Reuters) - Wal-Mart Stores Inc. <WMT.N>, the world's biggest retailer, has set terms on its planned 32-year sterling bond, a banker familiar with the deal said on Monday.

The bond, due January 2039, will be priced to yield "low-90s" basis points over gilts, the banker said.

Citigroup, Goldman Sachs and Morgan Stanley are lead managers.

Wal-Mart holds AA credit ratings from Standard & Poor's and Fitch Ratings, and an equivalent Aa2 rating from Moody's Investors Service.

© Reuters 2006. All rights reserved.

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Airlines Enlist Wal-Mart, Cookies to Win China Route

By John Hughes
and Jonathan D. Salant
Bloomberg                                         [back to top]

Dec. 11 (Bloomberg) -- Continental Airlines has handed out 5,000 fortune cookies to members of Congress, Transportation Department officials and other Washington decision makers. Among the messages inside: ``Shanghai: The right route for the most people.''

American Airlines boasts the backing of Wal-Mart Stores Inc., the world's largest retailer. Northwest Airlines has the support of Michigan and Minnesota lawmakers. United Airlines does Northwest one better: It brandishes a letter signed by incoming House Speaker Nancy Pelosi.

The four U.S. based carriers are all after the same prize: rights to a single new U.S.-China air route authorized under a 2004 agreement between the two nations. At stake is annual revenue of more than $100 million, along with greater access to the world's fastest-growing economy in time for the 2008 Olympic Games in Beijing.

``This is about as public of a fight I've seen,'' says Jon Ash, president of InterVistas-GA2, a Washington-based consulting firm. ``The bidding gets pretty ferocious. It's a limited resource, and everybody wants it.''

The result is a competitive frenzy among the four airlines, and their supporters. Public letter-writing campaigns organized by the carriers have generated more than 400,000 messages to Transportation Secretary Mary Peters, who will make the decision any day now; at least 265 of the 535 members of Congress have already written her as well.

63 Trips

The four U.S. carriers, who are the only ones eligible to vie for the new route, are currently allowed only 63 round trips to China weekly; the only direct flights depart from Chicago, San Francisco and Newark, New Jersey.

The much-coveted additional non-stop route, to begin next year, was authorized under a 2004 revision to a 25-year-old treaty. Peters's role is to decide which of the carriers' proposals would accomplish the most good for the most people, her spokesman says.

Continental Airlines Inc. wants to add a flight between Newark and Shanghai; AMR Corp.'s American is proposing a route between Dallas-Fort Worth and Beijing, and last week -- in a move that might threaten its bid -- added a stop in Chicago to sidestep a dispute with pilots; UAL Corp.'s United, Washington and Beijing; and Northwest Airlines Corp., Detroit and Shanghai.

Aaron Taylor, an analyst with Eclat Consulting Inc. in Reston, Virginia, who studies airline data, says winning the route would mean $153 million a year for United or Northwest, $113 million for Continental and $106 million for American. The carriers decline to release their own revenue estimates.

`Particularly Profitable'

International routes are generally more lucrative than domestic ones, and ``the route to be awarded should be particularly profitable because traffic between the U.S. and China is growing rapidly,'' says Philip Baggaley, a Standard & Poor's analyst in New York. ``There are limited routes available, so there is a scarcity value as well.''

The Montreal-based International Air Transport Association says the number of China air passengers will grow at an average annual rate of 9.6 percent through 2009. Only Poland will grow faster among countries with at least 2 million annual passengers, the group said in its 2005 forecast.

To help make their cases, the carriers have enlisted companies that might benefit from having easier access to China. ``We're always interested in moving our people as conveniently and efficiently as we can,'' says Greg Martin, a spokesman for Detroit-based General Motors Corp., which wrote Peters to endorse Northwest's proposal. Having a direct flight from Detroit ``would certainly help,'' he says.

Backing for American

Similarly, Bentonville, Arkansas-based Wal-Mart is backing American's Dallas bid. ``We expect our need for air service to Beijing to increase,'' wrote executives Duane Futch and Beth Keck. ``It is important that our company have easy, convenient access.''

The carriers have also enlisted an array of Washington heavy-hitters. Chicago-based United, for instance, hired the public-relations firm that employs former Federal Aviation Administration chief Jane Garvey, and counts former Secretary of State Madeleine Albright among its backers.

The New Jersey congressional delegation endorsed Continental in a Sept. 20 letter. The number of Asian-Americans in the New York-New Jersey area ``is larger than the Asian-American communities of Texas, Michigan and the District of Columbia added together,'' the letter said.

`Good to New Jersey'

``Continental has been good to New Jersey as well as other places,'' says Democratic Representative Bill Pascrell, a member of the House Transportation and Infrastructure Committee. ``If they want to expand service, it's important that the delegation stand behind them.''

United's prominent backers include Pelosi, Majority Leader- designate Steny Hoyer of Maryland, Democratic Congressional Campaign Committee Chairman Rahm Emanuel of Illinois and Senate Deputy Majority Leader-designate Richard Durbin of Illinois.

United has a hub in Pelosi's hometown of San Francisco, wants to fly out of Dulles Airport adjacent to Hoyer's state and is based in Illinois.

``It's an important option for us to increase business travel to China,'' Durbin says. ``I hope we'll be able to expand our exports to that country, and I'm glad that United Airlines is offering that option.''

Michigan and Minnesota lawmakers have written on behalf of Eagan, Minnesota-based Northwest, which has a hub in Detroit. ``We're on Northwest every week,'' says Michigan Democratic Representative Sander Levin.

Broad Support

Letters and support are among the criteria the Transportation Department will consider, says Michael Whitaker, United's vice president of alliances, international and regulatory affairs. ``If you are trying to define a public benefit, you want to see how broad that support is,'' Whitaker says.

The public support ``shows the department that what we are saying about our case is true,'' says Hershel Kamen, Continental's vice president of regulatory affairs.

The Transportation Department's goal is ``to maximize public benefits,'' spokesman Bill Mosley says. Broad support, he adds, is ``something we take into consideration.''

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Clinging to its roots, Wal-Mart steps back from an edgy, new image

By Michael Barbaro
and Stuart Elliott                             
International Herald Tribune                       [back to top]

Sunday, December 10, 2006 It was the kind of bold advertising campaign that executives of Wal-Mart Stores agreed was needed to attract style-hungry consumers: a series of commercials featuring two sisters — one a regular Wal-Mart shopper, the other not — trying to redecorate their homes.

In commercials set to run throughout this holiday season, the sisters were to discover that Wal-Mart offered a lot more than low prices.

But in July, as gasoline prices spiked, senior executives abruptly scrapped plans for the so-called sisters campaign, sending a marketing team led by Julie Roehm scrambling to create a replacement, according to people involved in the process. The reason: The ads did not focus enough on low prices.

Wal-Mart fired Roehm — and rejected her choice for the chain's new ad agencies — last week after determining she had violated company policy by showing favoritism toward potential vendors and maintaining a personal relationship with a subordinate, according to people briefed on the matter. She has denied any wrongdoing.

But Roehm's near-operatic downfall exposes deeper tensions within the Wal-Mart empire, as a company that has been identified for four decades with working-class consumers tries to appeal to more affluent Americans.

A year ago, Wal-Mart surprised the marketing world by hiring brash outside executives like Roehm and introducing ads that emphasized style and played down price. Then, in a sudden reversal, the company began trumpeting price- slashing for the 2006 holiday season.

In an interview, John Fleming, the chief marketing officer at Wal-Mart, said the company had indeed begun to backtrack from sleeker advertising that emphasized style over price. Customer research, he said, showed that, rich or poor, Wal-Mart customers "care about unbeatable prices."

"I don't think Wal-Mart advertising is ever going to be edgy," he said Friday night. "I do not think that fits our brand. Our brand is about saving people money."

But Roehm was the very essence of edgy — and her hiring was widely viewed as a signal that Wal-Mart wanted to shake up its marketing.

As an executive at DaimlerChrysler, she approved a Chrysler commercial in which a mother explained to her daughter that her brother had been conceived in the car, spurring customer complaints that led to the spot's being dropped.

And after arriving at Wal-Mart, she referred to herself as a "change agent" and set about turning the company's annual shareholder meeting — a traditionally PowerPoint- and numbers-heavy affair — into a three-hour musical.

Roehm, in an interview, said she believed her job at Wal-Mart was to buck convention. "I had to assume they felt I brought the right skill set in this quest for transformation," she said.

But Roehm said it was clear from the start that she did not fit in.

"Culturally, I clearly was an anomaly," she said, likening her personality to a vacuum that can, at times, suck all the oxygen out of the room. "I come in and I am extremely high energy, and it can be overwhelming."

And, she said, her background at Chrysler — where her specialty was eye-popping, sexually charged ads to sell trucks — may have alienated her colleagues.

"My ideas were viewed with greater skepticism," she said. "People understood my background and where I came from, and they were probably more concerned about the kinds of ideas I might bring. It caused a greater level of pause when I suggested something."

In several cases, Wal-Mart approved her ideas, only to reverse course later.

After a few consumers complained about a holiday commercial that had been overseen by Roehm and focused on lingerie, the company stopped running it. Fleming said Wal-Mart changed the holiday ads every week and decided, after receiving negative feedback, "to move on" with new commercials.

He also replaced the holiday campaign focused on the two style-conscious sisters with commercials built around a family whose curmudgeonly father is obsessed with low prices.

In all of its advertising, he said, "we are looking for the right balance between price and products."

Advertising executives who have worked with Roehm at Wal-Mart said she never seemed at home there.

"Julie's one of those celebrity" figures in marketing, said an advertising executive involved in the review process, who asked not to be identified because he was not authorized to discuss the process publicly. "When Julie walks into the room, it's Julie's room."

"But Wal-Mart's never been a culture of stars," he added, noting that the philosophy of the founder, Sam Walton, "was about the team and the workers on the floor."

Wal-Mart has not confirmed why it fired Roehm, but people briefed on the issue said it was over her conduct during a search for new ad agencies, which concluded in late October. During that process, these people said, Roehm accepted gifts from agencies, attended events considered out of bounds for an executive choosing a new firm and maintained a relationship with an employee.

Wal-Mart also fired the employee with whom Roehm was said to have had the relationship, Sean Womack, who answered directly to her. Both deny having had a relationship that violated Wal- Mart policies or behaving in a way that tainted the search for a new ad agency.

Copyright © 2006 The International Herald Tribune

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HK group: Wal-mart suppliers abuse workers

China Post
2006/12/10                            [back to top]

Several Chinese suppliers of Wal-Mart Stores Inc. fail to pay legally required wages or provide health insurance and allow poor working conditions, a Hong Kong-based labor group says. A Wal-Mart spokesman said Friday it was looking into the claims in a report issued this week by China Labor Watch. Managers at two companies cited in the report denied the accusations.

China Labor Watch said a survey of 15 Wal-Mart suppliers found that some pay as little as half the minimum daily wage, require mandatory overtime or provide no health insurance. It said one company provides a single bathroom for 2,000 employees.

The status of employees at foreign companies or their suppliers is a sensitive issue in China.

"We treat the issues as mentioned in this report seriously and will look into them. If found true, we will address them in an aggressive manner," a Wal-Mart spokesman, Jonathan Dong, said in an e-mail.

"Wal-Mart is committed to ethical sourcing and works continuously to strengthen our efforts in monitoring supplier factories," he said.

Dong said he couldn't immediately confirm whether the companies cited by China Labor Watch were Wal-Mart suppliers.

The group said its report was based on a survey of 169 employees at 15 companies.

It said one employer, Winbo Industry Co., pays as little as 2 yuan (25 U.S. cents; 20 euro cents) per hour -- less than half the legal minimum of 4.66 yuan (58 U.S. cents; 46 euro cents) in Guangdong province, where its factory is located.

It said Winbo and others fined employees up to one hour's pay for being one minute late to work, are overdue in paying back wages and have threatened to fire those who fail to work overtime.

Winbo's foreign trade manager denied the accusations.

"The information you had is totally wrong and Wal-Mart is not our customer," said the manager, who would give only his surname, Zhuang.

The manager of another company cited, Yongfeng Shoe Manufacturing Co., also denied the claims.

"We never owed wages to workers and workers' wages are based on regulations," said the manager, Hu Tianfei. He said the company has been a Wal-Mart supplier for 10 years.

Phone calls on Friday to the other two companies identified by name in the report -- Taishan Watch Factory and Taiqiang Manufacturing Factory -- weren't answered.

All the companies cited in the report are located in the southern province of Guangdong, the site of thousands of small factories that supply China's export industries.

Wal-Mart is a prominent presence in China, with 68 stores and 36,000 employees, and in 2004 bought US$18 billion worth of Chinese goods, such as shoes and furniture, either directly or indirectly for sale abroad.

Worldwide, Wal-Mart audited 13,600 of its suppliers' factories last year, according to Dong, the spokesman at its China headquarters in the southern city of Shenzhen.

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Ad targets employee benefits at Wal-Mart

Bloomberg News
December 8, 2006                               [back to top]

A union-funded campaign attacking Wal-Mart Stores Inc. accelerated Thursday with the debut of its latest television advertisement in 42 cities, the organization's largest-ever broadcast effort. The TV spot sponsored by activist group Wake-Up Wal-Mart shows a woman shocked to hear it would take her 1,000 years to make the $17.5 million Chief Executive H. Lee Scott earned in fiscal 2005. Wake-Up Wal-Mart is funded by the United Food and Commercial Workers union.

Wake-Up Wal-Mart is spending $1 million for a four-week campaign that calls on the company to boost wages and benefits. The ad will air on network stations in Chicago, Atlanta, St. Louis and 39 other cities for about a week, Paul Blank, Wake-Up Wal-Mart's campaign director, said Thursday.

"We are targeting the people who don't yet know Wal-Mart's negative impact, who, if they knew, would look at Wal-Mart a different way," Blank said.

The group is also distributing 100,000 brochures with information about the largest-ever sex-discrimination lawsuit Wal-Mart is facing, involving 1.6 million workers.

"While our critics continue to offer nothing but negativity through these ads, Wal-Mart provides real solutions to the problems facing this country, and Americans see the positive impact we're having," said Wal-Mart spokesman David Tovar.

Wake-Up Wal-Mart has sponsored events by politicians including Sen. Barack Obama and former Sen. John Edwards (D-N.C.). They are two possible 2008 presidential candidates who have criticized the retailer's treatment of its workers.

The latest campaign by Wake-Up Wal-Mart comes at a time when sales growth at the company has slowed.

Wal-Mart expects December sales at stores open at least a year may rise between 0 percent and 1 percent. That would be the third month in a row gains failed to exceed 1 percent. Such sales, called same-store sales, are considered a key indicator of a retailer's health.

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Wal-Mart's China suppliers underpay

Firms deny charges leveled by Hong Kong-based labor watchdog

The Associated Press
Dec 8, 2006                                          [back to top]

BEIJING - Several Chinese suppliers of Wal-Mart Stores Inc. fail to pay legally required wages or provide health insurance and allow poor working conditions, a Hong Kong-based labor group says.

A Wal-Mart spokesman said Friday it was looking into the claims in a report issued this week by China Labor Watch. Managers at two companies cited in the report denied the accusations.

China Labor Watch said a survey of 15 Wal-Mart suppliers found that some pay as little as half the minimum daily wage, require mandatory overtime or provide no health insurance. It said one company provides a single bathroom for 2,000 employees.

The status of employees at foreign companies or their suppliers is a sensitive issue in China.

"We treat the issues as mentioned in this report seriously and will look into them. If found true, we will address them in an aggressive manner," a Wal-Mart spokesman, Jonathan Dong, said in an e-mail.

"Wal-Mart is committed to ethical sourcing and works continuously to strengthen our efforts in monitoring supplier factories," he said.

Dong said he couldn't immediately confirm whether the companies cited by China Labor Watch were Wal-Mart suppliers.

The group said its report was based on a survey of 169 employees at 15 companies.

It said one employer, Winbo Industry Co., pays as little as 2 yuan (25 U.S. cents) per hour — less than half the legal minimum of 4.66 yuan (58 U.S. cents) in Guangdong province, where its factory is located.

It said Winbo and others fined employees up to one hour's pay for being one minute late to work, are overdue in paying back wages and have threatened to fire those who fail to work overtime.

Winbo's foreign trade manager denied the accusations.

"The information you had is totally wrong and Wal-Mart is not our customer," said the manager, who would give only his surname, Zhuang.

The manager of another company cited, Yongfeng Shoe Manufacturing Co., also denied the claims.

"We never owed wages to workers and workers' wages are based on regulations," said the manager, Hu Tianfei. He said the company has been a Wal-Mart supplier for 10 years.

Phone calls on Friday to the other two companies identified by name in the report — Taishan Watch Factory and Taiqiang Manufacturing Factory — weren't answered. All the companies cited in the report are located in the southern province of Guangdong, the site of thousands of small factories that supply China's export industries.

Wal-Mart is a prominent presence in China, with 68 stores and 36,000 employees, and in 2004 bought $18 billion worth of Chinese goods, such as shoes and furniture, either directly or indirectly for sale abroad.

Worldwide, Wal-Mart audited 13,600 of its suppliers' factories last year, according to Dong, the spokesman at its China headquarters in the southern city of Shenzhen.

Wal-Mart was the target this year of a union-organizing campaign by China's government-sanctioned labor group.

After resisting unionizing efforts for two years, the company agreed in August to cooperate with the All-China Federation of Trade Unions to set up unions at all of its China outlets.

Also this year, Apple Computer Inc. was caught up in a controversy over claims of abuses at a Chinese factory run by a Taiwanese company that produces its iPod music players.

Apple issued a report in August saying it found some violations of its code of conduct at the factory run by a subsidiary of Taiwan's Foxconn Technology Group but no serious abuses.

© 2006 The Associated Press. All rights reserved.

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Group accuses Chinese suppliers to Wal-Mart of underpaying, mistreating workers

By JOE McDONALD
AP Business
Friday December 08, 2006                                [back to top]

BEIJING (AP) Several Chinese suppliers of Wal-Mart Stores Inc. fail to pay legally required wages or provide health insurance and allow poor working conditions, a Hong Kong-based labor group says.

A Wal-Mart spokesman said Friday it was looking into the claims in a report issued this week by China Labor Watch. Managers at two companies cited in the report denied the accusations.

China Labor Watch said a survey of 15 Wal-Mart suppliers found that some pay as little as half the minimum daily wage, require mandatory overtime or provide no health insurance. It said one company provides a single bathroom for 2,000 employees.

The status of employees at foreign companies or their suppliers is a sensitive issue in China.

``We treat the issues as mentioned in this report seriously and will look into them. If found true, we will address them in an aggressive manner,'' a Wal-Mart spokesman, Jonathan Dong, said in an e-mail.

``Wal-Mart is committed to ethical sourcing and works continuously to strengthen our efforts in monitoring supplier factories,'' he said.

Dong said he couldn't immediately confirm whether the companies cited by China Labor Watch were Wal-Mart suppliers.

The group said its report was based on a survey of 169 employees at 15 companies.

It said one employer, Winbo Industry Co., pays as little as 2 yuan (25 cents) per hour less than half the legal minimum of 4.66 yuan (58 cents) in Guangdong province, where its factory is located.

It said Winbo and others fined employees up to one hour's pay for being one minute late to work, are overdue in paying back wages and have threatened to fire those who fail to work overtime.

Winbo's foreign trade manager denied the accusations.

``The information you had is totally wrong and Wal-Mart is not our customer,'' said the manager, who would give only his surname, Zhuang.

The manager of another company cited, Yongfeng Shoe Manufacturing Co., also denied the claims.

``We never owed wages to workers and workers' wages are based on regulations,'' said the manager, Hu Tianfei. He said the company has been a Wal-Mart supplier for 10 years.

Phone calls on Friday to the other two companies identified by name in the report Taishan Watch Factory and Taiqiang Manufacturing Factory weren't answered. All the companies cited in the report are located in the southern province of Guangdong, the site of thousands of small factories that supply China's export industries.

Wal-Mart is a prominent presence in China, with 68 stores and 36,000 employees, and in 2004 bought $18 billion worth of Chinese goods, such as shoes and furniture, either directly or indirectly for sale abroad.

Worldwide, Wal-Mart audited 13,600 of its suppliers' factories last year, according to Dong, the spokesman at its China headquarters in the southern city of Shenzhen.

(Copyright 2006 by The Associated Press. All Rights Reserved.)

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Wal-Mart Confirms Ad Account Rumors

Chain Store Age
Friday, December 8, 2006                         [back to top]

Wal-Mart Stores has confirmed industry rumors that it plans to reopen bidding for its $580-million advertising account. The news followed the abrupt departure of Julie Roehm, senior VP of marketing communications, earlier this week. Roehm had led the review that led to Wal-Mart cutting ties with its longtime agency, Bernstein-Rein, and hiring DraftFCB, a division of Interpublic Group, to serve as the chain's agency of record. In addition, Aegis Group's Carat USA was hired to help with marketing. "We notified DraftFCB that we had decided to reopen the bid process for our advertising accounts and it will not be eligible to participate. This is the result of new information we obtained over the past few weeks," Wal-Mart spokeswoman Mona Williams said.

Williams said the new review should move quickly and that Wal-Mart expects a new agency to be on board by the end of January. While DraftFCB is not eligible to bid in the new process. Carat is, according to Wal-Mart.

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PR firm remakes Wal–Mart’s image

AP
Thursday 7th December, 2006                     [back to top]

(AP) – Over the last year, Lee Scott has appeared on the Rev. Al Sharpton’s radio show, talked about pro–environment policies and given speeches that repeatedly state his organization’s devotion to "working families."

If Mr. Scott, the chief executive of Wal–Mart Stores Inc., seems like he’s running for office, it’s no accident. For the last 15 months, the Edelman public–relations firm, led by seasoned political operatives, has been directing a campaign it calls "Candidate Wal–Mart." The goal: Rescue the battered image of the world’s largest retailer.

Edelman’s bipartisan team has been behind the curtain during Wal–Mart’s most visible recent initiatives – and some of its public stumbles. When Wal–Mart decided to sell an array of generic drugs for $4 a prescription, Edelman orchestrated a 49–state rollout, lining up local dignitaries in 79 places for publicity events. The PR giant also organized a grass–roots group called Working Families for Wal–Mart. But it had to scramble when the leader it helped recruit, Andrew Young, made derogatory comments about ethnic shopkeepers and was forced to resign.

Wal–Mart badly needs a boost. Its sales growth has waned in recent years and an effort to reach out to higher–earning shoppers has sputtered, partly because of the company’s beleaguered image. Sales at stores open more than a year fell 0.1 percent in the four weeks ending Nov. 24 – only the second monthly drop in 27 years. This year Wal–Mart scaled back expansion plans amid pressure from investors and political opposition in New York, Massachusetts, California and elsewhere.

As Edelman and Wal–Mart see it, image is crucial for drawing customers, smoothing the way for new stores in urban areas and beating back legislation that would raise costs. "This is not a public–relations campaign," says Michael Deaver, a former chief of staff for President Reagan who is now helping to oversee the Wal–Mart account as an Edelman vice chairman. "It’s a win–or–lose campaign. And if you’ve been involved in a presidential campaign, that’s the way you look at things."

Leslie Dach, a former adviser to Democratic politicians, led the campaign’s first year as an Edelman vice chairman. Now Mr. Dach is a Wal–Marter in full: In July, the retailer hired him as an executive vice president for communications and government relations, reporting directly to Mr. Scott, the CEO.

For years Wal–Mart did little to promote itself as a positive social force, believing its low prices would speak for themselves. But as it mushroomed to become one of the world’s biggest companies – with 6,700 stores and $312 billion in sales last year – it increasingly felt the sting of public criticism and pressure to fight back.

The pressure grew last year when unions started two organizations to hammer Wal–Mart: the Service Employees International Union’s Wal–Mart Watch and WakeUpWalMart.com, funded by the United Food and Commercial Workers union. At Wal–Mart’s annual meeting on June 3, 2005, Mr. Scott said: "Your company is the focus of one of the most well–organized and well–financed corporate campaigns in history ... A coalition of unions and others are spending over $25 million this year alone to try to do damage to this company."

A few weeks later, on June 28, two dozen Wal–Mart executives sat behind tables at a community–college conference center in Bentonville, Ark., Wal–Mart’s hometown. They heard pitches from three PR firms chosen as finalists – Edelman, APCO Worldwide and DCI Group.

In their "Candidate Wal–Mart" pitch, Messrs. Dach and Deaver of Edelman described a campaign with all the trappings of a U.S. presidential bid. A war room of publicists would respond quickly to attacks or adverse news. Operatives would be assigned to drum up popular support for Wal–Mart via Internet blogs and grass–roots initiatives. Skeptical outside groups, such as environmentalists, would be recruited to team up with Wal–Mart. Edelman won and quickly put its plan into practice, with three dozen staffers working on the account in Washington, D.C., and Bentonville.

Wal–Mart had been mulling the $4–per–prescription program before Edelman’s arrival, but the firm saw it as a chance to promote Wal–Mart as a catalyst for health–care change. In late September, Wal–Mart executives gathered with Florida officials, including Gov. Jeb Bush, to announce the program’s introduction in the Tampa area. That generated national coverage, despite Wal–Mart’s initial statements that it wouldn’t expand the program beyond Tampa until 2007. Then the company rolled it out in rapid–fire succession to 48 other states, declaring that the low–cost pills were so popular it didn’t want to keep people waiting.

The acceleration of the program earned new national coverage, but even more important were local news outlets. The 79 news conferences arranged by Edelman across the country helped the effort win notices from The Dallas Morning News, Vermont’s Burlington Free Press and others.

Privately held Edelman is the largest U.S. public relations firm with 2005 revenue of $254 million and clients such as Microsoft Corp. and Pfizer Inc. (Dow Jones & Co., publisher of The Wall Street Journal, has also been a client.) Both Wal–Mart and Edelman decline to disclose Edelman’s fee, but outside estimates put it in the millions of dollars annually.

Mr. Dach, a slightly built 52–year–old, was born and raised in the New York City borough of Queens, son of a homemaker and a small–business owner in Manhattan’s garment district. He studied neurobiology at Yale but quickly was drawn to politics, working on the advance teams of Sen. Edward Kennedy and President Carter during their 1980 presidential bids.

He went on to play prominent advisory roles for Democrats in five of the next six presidential campaigns. He prepared Al Gore for debates in 2000 and handled publicity for Democratic efforts in 2004 to keep Ralph Nader off the ballot in several states. In between campaigns, he spent 17 years at Edelman advising clients such as a Fujifilm Corp. division and the Nature Conservancy.

Mr. Dach believes his experience trouble–shooting for political candidates can be applied to the corporate world. "Every crisis is an opportunity," he said in a recent interview. "The American people understand imperfection. But what they want to see is a company taking responsibility and then moving forward."

Soon after getting hired by Wal–Mart, Edelman found an opening. In the wake of Hurricane Katrina, Wal–Mart rushed to reopen its stores and speed supplies to the storm–damaged areas. Edelman helped Wal–Mart get coverage for its efforts and spotlighted Jason Jackson, the retailer’s emergency–planning director. Mr. Jackson gave interviews, spoke on a conference call with reporters and gave some a peek into his command center for tracking weather and routing supplies.

After the storm, evacuees and local officials proclaimed in the news that Wal–Mart had outhustled the federal government. Also, Wal–Mart quickly made a $15 million donation to the hurricane–relief fund organized by former Presidents Clinton and Bush. The two ex–presidents praised Wal–Mart’s generosity.

Another early Edelman initiative was Working Families for Wal–Mart, the grass–roots organization. The idea was to allow Wal–Mart’s defenders to strike back against critics without requiring the company’s own PR staff to enter the fray. Wal–Mart provided the group’s funding and Edelman staffed it.

Edelman executive Greg St. Claire played a leading role in recruiting Mr. Young, the former U.S. ambassador to the United Nations, as the group’s chairman, according to people who spoke with Mr. St. Claire. They say Mr. St. Claire told colleagues how Mr. Young had praised Wal–Mart in public comments. Wal–Mart says its diversity department came up with the idea of bringing in Mr. Young. Mr. St. Claire declined to comment and Mr. Young’s office didn’t return phone messages.

Others recruited by Edelman for the group’s 14–member steering committee include Wheelchair Foundation vice president Chris Lewis, the son of entertainer Jerry Lewis, and singer Pat Boone. In its first year, Working Families for Wal–Mart reports amassing 150,000 supporters and assembling steering committees of local dignitaries in six states.

Yet the Working Families group has produced some of Edelman’s worst fumbles, too. Union–backed Wal–Mart Watch swooped in to claim the workingfamiliesforwalmart.com Web address, and posted statements there mocking the company–backed group as artificial. In August of this year, Mr. Young raised a stir when he told an African–American newspaper in California that Jewish, Korean and Arab shopkeepers overcharged inner–city African–Americans for stale food. He had been asked about Wal–Mart’s impact on mom–and–pop businesses. Mr. Young apologized and resigned from Working Families for Wal–Mart.

In October, bloggers and mainstream media criticized Working Families for Wal–Mart for not disclosing the full identities of two people – one the sister of Edelman’s Mr. St. Claire – whom it enlisted to write a pro–company blog. The two drove an RV around the country and posted happy accounts of the Wal–Mart customers and employees they encountered. Edelman’s chief executive, Richard Edelman, apologized on his own blog for the lack of disclosure.

The faux pas had union groups crowing. "Edelman stumbled badly on the Wal–Mart account, and the fake–blog episode is fast becoming a case study on the importance of PR transparency," said Wal–Mart Watch spokesman Nu Wexler.

In its pitch for the account, Edelman had warned Wal–Mart that Google results for a "Wal–Mart" search yielded mostly unflattering material, potentially overshadowing the company’s own sites. Edelman sought to balance that equation by funneling positive information about Wal–Mart to bloggers. For example, news that 24,500 people applied for 325 jobs at a new Wal–Mart outside of Chicago made its way onto some blogs.

Edelman has also tried to help Wal–Mart gain some control over the issue of health care. In October 2005, Wal–Mart Watch distributed an internal Wal–Mart document detailing strategies for cutting health–benefit costs by discouraging unhealthy job applicants. In January, Maryland enacted a law targeting Wal–Mart that required large employers to spend certain amounts on health–care benefits for workers in the state. The law spurred similar bills prompted by labor groups in more than two dozen states.

Mr. Dach pushed Mr. Scott to discuss health in a February speech to the National Governors Association. "Everybody was telling Leslie, ’We can’t do health care now. We don’t want to talk about health care.’ But Leslie just kept at it," says Mr. Deaver. Mr. Scott took Mr. Dach’s advice, announcing in his Edelman–drafted speech that Wal–Mart would improve health benefits for its workers by such steps as loosening eligibility requirements for part–timers.

Company officials are heartened that none of the bills modeled on Maryland’s law survived this year, although that may have more to do with a federal judge’s decision in July to strike down the Maryland law because he said it encroached on federal authority.

In Mr. Scott’s speech at this year’s annual meeting, he used an Edelman–inspired line with political echoes: "This company is committed to working families." In all, Mr. Scott used the expression "working families" 10 times in that speech, which Edelman wrote, and 11 times in two other talks around the same time. Since Edelman’s hiring, Wal–Mart has issued at least 44 press releases mentioning working families to describe its customers and employees.

Later in the summer, Edelman booked Mr. Scott in several unfamiliar forums, such as Mr. Sharpton’s radio show, where the CEO fielded questions from listeners. In July, Mr. Dach arranged for former Vice President Al Gore to speak about environmental issues and screen his global–warming movie "An Inconvenient Truth" at a quarterly meeting of Wal–Mart employees and environmental groups. Mr. Gore’s camp initially had concerns about Wal–Mart’s sincerity on the issue, but Mr. Dach helped allay them. "Leslie brings some credibility and integrity," said Roy Neel, Mr. Gore’s chief of staff.

This summer, Wal–Mart decided to bring Mr. Dach in–house. Mr. Dach was already so intimately involved in planning that he sometimes heard of key developments within Wal–Mart prior to the company’s own senior PR staffers, according to people familiar with the situation. Wednesday, Robert McAdam, who has been a top Wal–Mart PR executive since 2000, told colleagues he is leaving the retailer. In an interview, Mr. McAdam said his departure has nothing to do with Mr. Dach’s arrival.

In hiring Mr. Dach, Wal–Mart granted him stock then valued at $3 million and nearly 169,000 options. The retailer allows him to split his time between Bentonville and Washington, D.C., with Washington remaining his primary residence. He also gained oversight of the $1 billion Wal–Mart Foundation, a charitable group. "I’m convinced Wal–Mart is changing and the change is real," Mr. Dach wrote in an email to friends announcing the move.

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Wal-Mart Plans to Revisit Review; Hispanic Finalists Await Decision

By Mariana Lemann,
Marketing y Medios;
Aaron Baar and
Andrew McMains,
Adweek
December 07, 2006                                          [back to top]

Just weeks after hiring DraftFCB in one of the year's most closely watched reviews, Wal-Mart is splitting with the Interpublic Group agency and plans to put its $570 million ad account back in play "based on new information that has come to light in the past two weeks," said client representative Mona Williams.

Wal-Mart has not decided if the new competition is open to all comers or just finalists from the fist review, Williams said. The process will be completed by the end of January.

Also in flux are the four Hispanic advertising agencies that have been kept on hold by Wal-Mart. The retailer's decision for its Hispanic agency of record was expected Dec. 1, but finalists were informed the announcement would occur this week. They are still awaiting word.

Long Beach, Calif.-based Grupo Gallegos, Austin, Texas-based LatinWorks, Coral Gables, Fla.-based Accentmarketing, and incumbent Lopez Negrete Communications are pitching for the estimated $50 million account. Sources at the agencies say they are also in the dark.

In a statement late Wednesday, before today's breaking news was released, Alex Lopez Negrete, president and CEO of Lopez Negrete, which has been handling creative and media planning and buying for the retailer since 1995, stated: "We have no update at all, other than Wal-Mart has notified us that they have delayed announcing their agency selection decisions until later this month. They did not cite a reason for the delay, nor did they specify a date for an announcement."

LatinWorks, a shop that was partly acquired by Omnicom in September, declined to comment and referred queries to Wal-Mart and search firm SelectResources International of Santa Monica, Calif., which has been conducting the agency review process.

Grupo Gallegos and Accentmarketing could not be reached for comment.

The move to reopen the general-market review comes two days after the abrupt departures of Wal-Mart executives Julie Roehm, senior vice president, marketing communications, and Sean Womack, vice president, communications architecture. But sources familiar with the situation say that the departure of the two top marketing executives should not affect the Hispanic agency reviews or selection decision and that the retailer plans to announce its decision shortly.

Williams would not say if those departures and the decision to part with DraftFCB were linked, but she said the agency was ineligible to re-pitch the account. Roehm had been a key decision maker in the review, in which DraftFCB and Aegis Group's Carat unseated incumbents GSD&M, an Omnicom Group shop in Austin, Texas, and Bernstein-Rein, an independent agency in Kansas City, Mo.

Julie Roehm, formerly a DaimlerChrysler and Ford Motor Co. marketing executive, was tapped in February by Wal-Mart as an agent of change. Among the retailer's plans for change was to appeal to a slightly more upscale audience. But in light of disappointing sales for a three-month period ending in November and skepticism on Wall Street, Wal-Mart's directive was to return to its roots.

In the review that finished in October, DraftFCB won creative duties, while Carat picked up media chores.

In a brief statement Monday, Roehm said, in part, "One of my first orders of business was to help spearhead a comprehensive agency review. Now that I have established the marketing communications organization and completed the agency review, it's time to tackle my next challenge."

Roehm reported to Wal-Mart evp and CMO John Fleming.

© 2006 VNU eMedia Inc. All rights reserved.

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Canadian Court Denies Wal-Mart Appeal

Chain Store Age
Thursday, December 7, 2006                       [back to top]

A provincial appeals court in Montreal has refused to hear an appeal by Wal-Mart Stores over the union certification of its store in Gatineau, Quebec. According to reports, the retail giant asked the court to force provincial labor authorities to conduct a secret ballot of employees at the store, which was certified last year after between 35% and 50% of its workers at the store signed union cards. A union vote was canceled when the United Food and Commercial local withdrew its request, but another union local submitted its request for accreditation the following day, according to the Canadian Press report. The report also said that Wal-Mart challenged the decision by objecting to the legality of the withdrawal.

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Wal-Mart supercenter for Fairfield gets green light

Pia Sarkar,
SF Chronicle
Thursday, December 7, 2006                          [back to top]

FAIRFIELD -- The Fairfield City Council unanimously approved a controversial plan late Wednesday to enlarge Wal-Mart's presence in the city with a huge new store.

Wal-Mart will now be allowed to build a 200,000-square-foot Supercenter on North Texas Street in the Solano County city. The plan, drawn up more than two years ago, has aroused complaints from residents fearful of potential noise, pollution and traffic, but has been endorsed by the Fairfield-Suisun Chamber of Commerce, which would like to see a new business on the blighted 18 acres.

The Supercenter, which combines a traditional discount store with a grocery, is part of Wal-Mart's plans to open 40 such stores throughout California in the next several years. So far, the Bentonville, Ark., chain has opened 21 Supercenters in the state, including eight in Northern California.

The Fairfield City Council's decision comes on the heels of the Planning Commission's deadlocked 3-3 vote over whether to approve the project. City planning staff has recommended moving forward with the Supercenter, provided that Wal-Mart meets some 100 requirements, including truck delivery limitations and noise restrictions.

The site, known as the Mission Village Shopping Center, is currently designated for mixed use, having been designated previously for community commercial use. Wal-Mart must obtain a special permit to build the Supercenter, as required by an ordinance passed in August that limits the size of retail projects in Fairfield to 80,000 square feet.

The shopping center on North Texas Street has been largely vacant since 2000, after an Albertsons supermarket -- the anchor tenant -- closed its doors. Wal-Mart proposes to demolish all existing structures with the exception of a church building and about 6,000 square feet of occupied commercial space.

In their place, the company wants to construct a Supercenter that includes 108,505 square feet of general merchandise, 45,989 square feet of grocery, a 754-square-foot pharmacy area and a 15,130 square-foot garden center.

If the proposed Supercenter opens, Wal-Mart would shut down its store on Chadbourne Road in Fairfield.

©2006 San Francisco Chronicle

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Wal-Mart slashes prices to lure Canadian shoppers

MARINA STRAUSS
Globe and Mail                                        [back to top]

Wal-Mart Canada Corp. is slashing prices on a range of its most popular holiday gift items in a move that is expected to force other retailers to follow suit.

The giant retailer said today that Canadians are delaying their holiday shopping, prompting it to move swiftly to try to stimulate business by cutting prices. As well, customers are starting to expect price reductions earlier in December, said Jim Thompson, senior vice-president of merchandise at Wal-Mart.

“Retailers know that customers have options, and that price is a major factor in gift-buying decisions,” Mr. Thompson said. “That means we're setting the price standard earlier, giving customers an idea of the deals they can expect in our stores.”

As examples of the price cuts, it said the price of a flat-panel high-definition plasma television has been chopped by about $400 to $1,400. A Trivial Pursuit board game is now about $29, down from $39.

Consumers will even see savings on home staples: Tide laundry detergent now costs $13, a $4 cut.

The move follows price cuts at Wal-Mart's U.S. parent last month as business slowed. The Bentonville, Ark-Based discounter, the single biggest retailer on the planet, said same-store sales fell for the first time in more than a decade in November, down 0.1 per cent from a year earlier. And company executives warned that its December sales would also be flat.

In Canada, the company is slashing prices immediately on toys, electronics, home decor products, fashion, food and other key merchandise. It will mean “tens of millions of dollars” of savings for Canadians this month, it said.

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Ohio Wal-Mart closes because of methane gas fumes

Associated Press
Thu, Dec. 07, 2006                                   [back to top]

GARFIELD HEIGHTS, Ohio - A Wal-Mart store built atop a landfill closed during the busiest shopping time of the year because of a methane gas leak.

Employees at the store in suburban Cleveland reported a bad smell, evacuated customers and shut the doors Tuesday night.

Wal-Mart says it doesn't know when the store will reopen, and fire officials say the methane fumes are not enough to be dangerous.

The retailer is part of the new City View shopping center, which is built on top of an old landfill.

Developer John McGill said faulty floor drains installed by Wal-Mart's engineer had been emitting sewer gas, which typically includes mixtures of methane and rotten egg-scented hydrogen sulfide. He said the problem would be corrected.

"It's a minimal issue," McGill said. Wal-Mart "acted on the side of safety."

Wal-Mart officials and the Ohio Environmental Protection Agency said the source of the methane had not been identified.

Mia Masten, spokeswoman for Wal-Mart's Midwest division, said she did not know how long the store would be closed and that employees will continue to be paid.

"Trust me, it's the holiday season, and we want to reopen as soon as possible," she said.

Ohio EPA spokesman Mike Settles said an enforcement action is pending against McGill because regulators say he has not corrected seeping water from a hill on which the development sits.

Bill Skowronski, the EPA's district chief for Northeast Ohio, said methane is not toxic but can cause an explosion.

© 2006 AP Wire and wire service sources. All Rights Reserved.

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China may be next job engine in Wal-Mart's hometown

Foreign businesses may flock to NW Arkansas

Associated Press
Wednesday, December 6, 2006                                  [back to top]

BENTONVILLE, Ark. – Chinese companies may be the next source of job creation in Wal-Mart's hometown, following in the footsteps of U.S. companies that have flocked to northwest Arkansas to work more closely with the world's largest retailer.

A leading executive search firm, Cameron Smith Associates, and another area company that works with foreign producers will host a conference in China next month to show manufacturers there how they can boost business by opening local offices to manage their accounts with Wal-Mart.

Trade experts say the timing is right. Chinese producers, who so far mainly sell to the U.S. market through intermediaries, are expected to start moving into the U.S. in coming years with their own offices to bypass importers, to keep a larger slice of sales revenue for themselves and to gain a better sense of what their U.S. customers want.

"Wal-Mart is a very important customer for Chinese producers," said Myron Brilliant, vice president of the Asian-U.S. Chamber of Commerce in Washington, D.C. "One can only expect that Chinese companies are going to do what U.S. companies do, which is to get closer to their customers."

No official registry of Wal-Mart suppliers with local offices exists. And Bentonville/Bella Vista Chamber of Commerce officials say they know of no Chinese firms in the area that do business with Wal-Mart, although some from Taiwan and a handful of other foreign nations have local offices.

The latest figures available, in 2004, show Wal-Mart bought about $9 billion in goods from China directly and another $9 billion indirectly, or goods produced in China for another company and then sold to Wal-Mart.

Chief Executive Lee Scott has said Wal-Mart wants to buy more products directly from Chinese producers rather than going through importers, although he has declined to publicly set any targets by percentage or dollar amount.

Cameron Smith, whose firm in nearby Rogers specializes in hiring for Wal-Mart supplier teams, expects 2,000 new executive-level positions could be created over the next three to five years by Chinese manufacturers opening local offices.

His firm and Global Supplier Development are hosting the two-day conference in the southern Chinese manufacturing center of Dongguan that will feature speakers with a professional background in U.S. retail and in working with Wal-Mart.

"The goal is not to increase Chinese imports. The goal is to show Chinese companies how they can optimize their business by working directly with their customer, Wal-Mart," said Gary Dunn, a former Wal-Mart international executive and now partner in Global Supplier Development, a Rogers-based company that targets foreign suppliers.

Smith said Wal-Mart doesn't tell its suppliers to locate in northwest Arkansas. But competitive pressure among suppliers has kept the number growing steadily from less than 50 in 1994 to over 1,200 companies today.

That growth is one of the main factors that has driven a red-hot economy in the Bentonville-Fayetteville corridor, economists say.

Average house prices in the region have risen from about $97,000 in 2000 to about $218,000 now, according to the Bentonville/Bella Vista Chamber of Commerce. Per capita income rose 19 percent, nearly twice the national rate, to $27,112 in 2004 from $22,834 in 2000.

Many of the thousands of jobs at the local offices are executive-level positions with salaries over $100,000, analysts say. Local offices range from one-person home enterprises to the roughly 300 people managing Proctor & Gamble's account with Wal-Mart.

By opening offices near Wal-Mart's Bentonville headquarters, U.S. companies can work more closely with the retailer on issues like product development, delivery schedules and quality control. Smith says Chinese companies can profit as U.S. companies do from a closer physical presence to buyers at Wal-Mart headquarters.

"The idea is to recruit Chinese producers to open offices here that would be staffed by specialists hired in the United States," Smith said.

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Wal-Mart's Indian Connection

The world's largest retailer is teaming up with India's largest mobile-phone marketer to revolutionize retailing on the subcontinent

by Steve Hamm
BusinessWeek                                        [back to top]

At first blush, it seems like the strangest of pairings—the world's biggest retailer teaming up with the world's fastest-growing phone company. News on Nov. 27 that Wal-Mart Stores (WMT) had tapped Bharti Enterprises as its partner on a new venture to take on India's huge but fragmented retail market left many scratching their heads. What does a cellular carrier know about selling saris or sodas?

Possibly a lot. Bharti's Airtel is ubiquitous in India, much as Wal-Mart's stores are in the U.S.: Its black, red, and white logo is plastered on the sides of buildings in countless cities and villages. The Delhi company has grown to be the largest Indian mobile player, with 29 million subscribers and $2.5 billion in annual revenues, by perfecting its own "everyday low prices" formula.

By outsourcing off the technical aspects of the operation to established players such as Nokia (NOK), Ericsson (ERIC), and IBM (IBM), Airtel succeeded in driving down its price-per-minute charge to less than 2 cents. The company is an aggressive marketer, roping in customers at a rate of 1.5 million a month through hundreds of thousands of shops that sell Airtel services and recharge phones. "To play in India, you play to the 1 billion population, and you cater to all," says founder and Chairman Sunil Bharti Mittal.

End Run Around Regulation Now the 49-year-old Punjabi entrepreneur is making a bet that could elevate his company to the ranks of India's most important conglomerates, such as Tata and Reliance. "We're at a tipping point," says Mittal. "India is becoming a consuming nation."

With India's economy growing at 8%-plus annually, retail sales are set to soar from $300 billion today to some $637 billion by 2015, estimates local consultancy KSA Technopak. But the market is now dominated by millions of tiny mom-and-pop shops. An antiquated transportation system and an army of middlemen have hobbled the development of homegrown retail chains with nationwide reach. And foreigners have been shut out by laws barring them from operating anything other than single-brand outlets.

Bharti and Wal-Mart have found a way around that prohibition. The partners will set up a 50-50 joint venture to handle logistics, warehousing, and haggling with suppliers. A separate company, owned entirely by Bharti, will run the retail end of the business. Bharti expects to have its first stores up and running within 12 months.

The behemoth from Bentonville, Ark., isn't the first multinational to court Bharti. French insurance giant Axa Group (AXA) recently formed a joint venture with the Indian company to sell life insurance. Retailers Carrefour of France and Tesco (TESOF) were each conducting their own mating dance with Bharti when Wal-Mart cut in. The American company wouldn't comment on the tieup except to say that it chose Bharti because of its knowledge of the Indian consumer.

Stiff Competition Ahead India hands say an even bigger asset is Mittal's entrepreneurial drive. The son of politician, Mittal started his first business, a bicycle-parts maker, shortly after graduating from university in the 1970s. In the 1980s, he switched to importing portable electricity generators from Japan. Bharti was manufacturing push-button phones in the early 1990s, when India began deregulating its telecommunications sector. Mittal won bidding for a cellular license in 1992, and over the next decade, proceeded to buy out many of his struggling competitors.

Despite that impressive track record, Mittal and his new partner, Wal-Mart, had better brace for some stiff competition. Investment in India's retail sector is projected to total $25 billion over the next five years, up from a mere $2 billion in the past decade—with slightly over a third coming from foreign players.

Dreaming Big Among Indian conglomerates, the race is already on. First out of the gate was Reliance Industries, which has already opened 30 produce stores and plans thousands of outlets in the next few years. "The size of the opportunity is huge, and there's room for a lot of players," says Venugopal Komanduri, chief executive for customer operations at Reliance Retail in Andhra Pradesh, the state where it's piloting store concepts.

Not everything Mittal touches turns to gold. In late 2004, Bharti teamed up with British investment bank Rothschild to take advantage of India's low-cost farming to export fresh fruit and vegetables to Europe. So far, the business has been a major disappointment. Crop yields are poor, and the company hasn't developed the cargo-carrying capacity to export to Europe.

Nonetheless, few would bet against Mittal. "Now is the time for people who dream big and have the ability to make it happen," says Ajit Rangnekar, deputy dean at the Indian School of Business in Hyderabad. "Sunil Mittal is one of those people."

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Ahead of the Bell: Wal-Mart execs leave

The Associated Press
December 6, 2006                                  [back to top]

Senior marketing executive Julie Roehm has left Wal-Mart Stores Inc. after less than a year on the job, at a time when the world's largest retailer is struggling to prove to Wall Street it can get out of a sales slump.

Wal-Mart said Tuesday that Roehm, who as senior vice president of marketing communications helped lead Wal-Mart's switch to advertising agency Interpublic from Omnicom, left the company this week. Sean Womack, who was hired just this spring to work under Roehm as vice president of communications architecture, also left at the same time.

The company declined to give a reason for the sudden departures, which follow statements by CEO Lee Scott in October that Wal-Mart had gone too far in pushing trendy goods and planned to refocus on promoting low prices.

Last week, Wal-Mart riled the markets by reporting its first monthly sales decline in a decade and warning its holiday sales would disappoint Wall Street.

How Roehm's departure will affect Wal-Mart's ad accounts with Interpublic Group's DraftFCB and Aegis Group's Carat, reportedly worth more than a half a billion dollars a year, remains to be seen.

Wal-Mart shares closed Tuesday at $46.48 on the NYSE.

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Fairfield divided over Wal-Mart Supercenter

It would add taxes and jobs, plus traffic and competition

Pia Sarkar,
SF Chronicle 
Wednesday, December 6, 2006             [back to top]

This time, it's Fairfield's turn to decide what to do when the world's biggest retailer wants to expand.

Wal-Mart proposes to build a 200,000-square-foot Supercenter on North Texas Street in the Solano County city. As in several other places in the Bay Area and around the nation, the plan is drawing complaints from residents fearful of potential noise, pollution and traffic. But it's winning support from the Fairfield-Suisun Chamber of Commerce, which would like to see a new business on the blighted 18 acres.

The City Council is set to vote on the issue at 7 tonight after the Planning Commission deadlocked 3-3 over whether to approve the project. City planning staff recommends moving forward with the Supercenter, provided that Wal-Mart meets some 100 requirements, including truck delivery limitations and noise restrictions.

The proposal is in keeping with Wal-Mart's designs to construct 40 California Supercenters -- which combine a traditional discount store with a grocery -- over the next several years. So far, the Bentonville, Ark., chain has opened 21 Supercenters in the state, eight in Northern California.

But the company has hit some major snags. Although some Supercenter proposals have sailed through, others have met with staunch resistance.

In Hercules, for instance, the City Council invoked eminent domain to stop Wal-Mart from building a Supercenter near the city's waterfront. In American Canyon, a state appeals court overturned the approval of a Supercenter deemed to be in violation of the California Environmental Quality Act. In Antioch, the council put off until January a vote on whether to expand an existing Wal-Mart into a Supercenter.

In Fairfield, the issues are much the same. Because Wal-Mart is nonunion, organized labor fears it will undermine gains made by retail employees. Small businesses worry they can't compete and will be forced to close. Residents decry increased traffic, not just from customers, but delivery trucks.

At the same time, senior citizens welcome the prospect of paying less for prescription drugs at Wal-Mart. And the city stands to benefit from a sales tax infusion.

Kevin Loscotoff, a spokesman for Wal-Mart, points out that the North Texas Street site, known as the Mission Village Shopping Center, has been largely empty since 2000. The shopping center was formerly anchored by an Albertsons supermarket, which closed.

"This site has been blighted for a number of years and left vacant by retailers," Loscotoff said. "This is an opportunity for us to revitalize it."

Linda Faivre, who has lived three blocks from the site for 20 years and heads up a group called the Fairfield Neighbors Promoting Smart Growth, said Wal-Mart should expand its existing store on Chadbourne Road instead of building a Supercenter that will be open 24 hours a day, seven days a week, right near an elementary school and a high school.

"Our group is not trying to stop Wal-Mart coming into Fairfield," Faivre said. "We just want them to go into another location."

Wal-Mart plans to close the Chadbourne Road store if the proposed Supercenter receives approval. Loscotoff said the company prefers North Texas Street because of its visibility.

"We saw this as a opportunity to be closer to our customers," he said. "It's a more convenient location."

Leslie Fay, president and chief executive officer of the Fairfield-Suisun Chamber of Commerce, said her organization endorsed the Supercenter after surveying its 700 members and finding that 60 percent of the 130 who responded favor the project.

Fay said most felt that Wal-Mart would boost the economy and that they themselves would shop there. Although she acknowledged that small businesses had expressed concern, the chamber has encouraged them to distinguish themselves from Wal-Mart by creating a niche market for their goods and services.

Councilwoman Marilyn Farley said she has her own concerns about the Supercenter, especially whether the city will become oversaturated with grocery stores. There are about half a dozen supermarkets in Fairfield, with the possibility of one more in addition to Wal-Mart. But she is still not sure which way she will vote.

"One day I'm leaning one way and the next day I'm leaning the other way," she said. "There's so many different factors that have come to mind."

Councilman John Mraz, who ran for office on an anti-Wal-Mart platform this year, said he too is torn about the issue. On the one hand, he objects to Wal-Mart's supposed predatory practices. On the other, the store could bring jobs as well as much-needed revenue.

Mraz predicts he will make friends and enemies no matter which way he votes. He points out that if he approves the project, some will accuse him of going back on his campaign comments.

"It doesn't matter," he said, "because I'm going to do what's best for the city."

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Wal-Mart abuses female employees

By Thalia Syracopoulous
Seattle Post-Intelligencer
December 6, 2006                                 [back to top]

As a mother, grandmother and now even great-grandmother I have lots of shopping I want to do for this holiday season. This is a busy time of year and there is much I'd love to buy. Like many others, I don't have enough money to do it all, so I have to think before I shop. I have to think about what to buy and where to shop. Good quality and affordable price are major considerations but they are not the only important things. I want my choices to be for the good of my family and my community, and women are an incredibly important part of my community.

So, despite the lure of low prices, I'm joining other women in Seattle on Thursday to urge shoppers to think before they shop at Wal-Mart.

I won't be shopping at Wal-Mart because Wal-Mart really is bad for women.

Of course, discrimination against women is common in corporate America and I can't guarantee that every place I shop treats women well. But Wal-Mart is the world's largest employer and one of the worst abusers of its women employees in the U.S.

It isn't just that Wal-Mart doesn't pay a living wage; it's that they pay women even less than men in the same positions. Women make up more than 70 percent of Wal-Mart's hourly employees but less than one-third of its store management. Only one of its top 20 officers is a woman. And, in 2001, the few women who become managers earned $14,500 less than their male counterparts. Women hourly workers earned $1,100 less than men. These are a few of the reasons Wal-Mart is the subject of the largest class-action suit ever in this country. The lawsuit represents more than 1.5 million present and past employees of Wal-Mart and its affiliate, Sam's Club.

It goes beyond that. This year, Wal-Mart instituted a salary cap on its employees so they can only earn so much. Wal-Mart now uses more part-time workers. If you work fewer than 34 hrs/week, you have to wait a year before being eligible for health insurance and, even then, your children cannot be included in the coverage. Full-time employees have to wait 180 days before they become eligible for health benefits. That's six months before you or your children can go to a doctor for any reason, even an emergency. Should a woman be one of the lucky ones who is eligible, and can afford to buy the insurance, she will learn that her health plan does not cover contraception.

We women are the shoppers in this country. In particular we are the ones who are most likely responsible for buying the basics -- food, clothing, shoes, school supplies, toilet paper and toys. These are the things Wal-Mart sells. If I choose to save money on each item by shopping at a Wal-Mart where the woman waiting on me can't afford day care, health care, food or even the contraceptives that might keep her family from growing larger than she can support, I am hurting her and a lot of other women. That is not good for me, my family or my community.

I know most of the women working at Wal-Mart are thankful they have a job, even one that underpays and possibly mistreats them. That is no reason for us to sit back and let the abuse continue.

Together, we can change Wal-Mart. Please think before you shop. You can learn about NOW work at now.org/issues/wfw/wal-mart.html

Thalia Syracopoulos is a member of the board of the Seattle chapter of the National Organization for Women.

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Wal-Mart $4 generics program launched in California

Philippine News
Dec 06, 2006                                 [back to top]

BENTONVILLE, Ark. – Wal-Mart Stores, Inc. announced that its 189 pharmacies in California began participation in its $4 generic prescription program starting Tuesday, November 28, 2006.

“When we made our initial announcement in Florida back in September, we never imagined that in addition to our 3,800 pharmacies, thousands of others would join us in bringing more affordable medicines to our nation’s seniors, working families and the uninsured. We are proud to have introduced competition to an area where it has been too scarce for too long,” said Wal-Mart President and CEO Lee Scott. “And, we hope others will continue to join us in making prescription medicines more affordable and accessible for all Americans.”

The latest announcement brought 11 new states with a total of 811 pharmacies into the $4 generics program. Along with California, the new states are Colorado, Connecticut, Hawaii, Louisiana, Minnesota, Montana, Pennsylvania, Tennessee, Wisconsin and Wyoming. The program kicked off in Florida in September, with plans to spread outside the state in January 2007. However, customer demand led Wal-Mart to accelerate the rollout of the program – now available in all 3,810 pharmacies in 49 states.

With the announcement, Wal-Mart has expanded the program to include 331 generic prescriptions available for up to a 30-day supply at commonly prescribed dosages. The list is made up of as many as 143 compounds in 26 therapeutic categories. According to www.rxlist.com, the list also includes 14 of the top 20 prescribed medications in the United States.

Response to the program has been considerable. Between September 21 and November 12, as the first 27 states were added to the program, 2.1 million more new prescriptions have been filled in those states as compared to the same time periods last year. Generic medicines generally cost between 30 percent and 60 percent less than equivalent brand-name products, and Wal-Mart estimates that its list of $4 generic prescriptions represents more than 25 percent of prescriptions currently dispensed in its pharmacies nationwide.

Bill Simon, executive vice president of Wal-Mart’s Professional Services Division, said the customer response has been significant. He said that he has heard hundreds of stories from customers and pharmacists about the program’s value. He also noted that many customers have greatly benefited from the savings.

“This program has had a positive impact on millions of Americans. We have received hundreds of letters and e-mails from customers over the last few months telling us how this program has changed their lives,” said Simon. “There are so many folks out there who are living on limited budgets and have paid too much for their medicines for too long. Their stories drove us to expand this program as quickly as possible, and it drove our competitors to meet our $4 price. This program is good for our customers, our communities and our healthcare system.”

Savings on top-selling prescription medications in the program are projected to be significant. For specific medications, the company estimates the following approximate savings to Wal-Mart, Neighborhood Market and Sam’s Club customers and members in the 38 states based on September average retail prices from www.myfloridarx.com:

• Metformin (500 mg), a diabetes medication: about $1.3 million monthly and $16 million annually on this medication.

• Warfarin (5 mg), a medication to prevent blood clots: about $750,000 monthly and $9 million annually on this medication.

Generics contain the same high quality active ingredients as their brand-name counterparts and are equally effective, but cost significantly less. Consumers interested in saving money on prescriptions through the program should ask their doctor if a generic is available for their prescription and is right for them.

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Wal-Mart Braces for a Blue Christmas

The discount chain is struggling as competitors match its prices and once-loyal shoppers snub its attempt to go glam. Seriously, high fashion with a smiley face?

By Keith Naughton
Newsweek
December 6, 2006                                           [back to top]

Dec. 6, 2006 - Jamie Bartosch used to be a Wal-Mart regular. Several times a month, the Arlington Heights, Ill., mother would drop $100 or more at her local Wal-Mart to stock up on staples like diapers, milk and cleaning supplies. Last Christmas, many of the gifts under her tree came from Wal-Mart. But that won't be the case this year. She's begun to notice other retailers matching Wal-Mart's low prices. And she's happy to shop the competition, rather than suffer through what she views as Wal-Mart's downscale atmosphere. "Why endure the crowds, the clogged aisles and the riffraff?" says Bartosch, 39. "Why not just go to Kohl's or Target and get the same things for the same prices?" It's turning into a blue Christmas for Wal-Mart. While many of its rivals ring up healthy holiday sales, Wal-Mart is struggling. In the critical shopping month of November, the nation's largest retailer suffered its first decline in same-store sales in more than a decade. And December isn't shaping up to be much better. Wal-Mart recently warned that sales at stores open at least a year will either be flat or up to only 1 percent this month. That's despite a costly image overhaul. Wal-Mart is spending billions sprucing up its stores and injecting some hipness into its dowdy image by selling items like skinny jeans, chandeliers and plasma-screen TVs. It's also moved away from its simple smiley face advertising that touted low prices, to ads that highlight its new stylish approach. That effort hit a snag this week when Wal-Mart's top marketing exec, Julie Roehm, abruptly left the company after only 10 months on the job. Wal-Mart confirmed the departure, but offered no explanation.

Instead of attracting more upscale shoppers, though, Wal-Mart is losing business at the time of year when it needs it most. Last month, the number of shoppers in its aisles declined every week, bottoming out during the crucial week of Thanksgiving, says Goldman Sachs retail analyst Adrianne Shapira, who called the retailer's lackluster December outlook "particularly disappointing."

What's wrong with Wal-Mart? For one thing, America's largest retailer is reaching shopping saturation now that it has nearly 4,000 stores in the U.S. Nearly every American now lives within 25 miles of a Wal-Mart. The retail giant recently announced plans to throttle back its aggressive expansion plans. Instead of opening a store a day in the U.S., it now will open 305 to 330 new big boxes a year. That's not enough scaling back, say some analysts, who warn that Wal-Mart's new stores are mostly competing with other Wal-Marts. "Wal-Mart is overstored," says retail consultant Burt Flickinger III. "They need to go down to 100 to 125 new stores a year."

With little new territory left to conquer, Wal-Mart now is trying to lure new shoppers who have more to spend. Currently, Wal-Mart's average shopper has a household income of $50,000 a year, while those who don't shop there have annual earnings averaging $64,000, according to WSL Strategic Retail. Those lower-income shoppers have been hurt most by volatile gas prices, and they're cutting back this holiday season. "Wal-Mart is relying on a shopper whose purse has to be pried open," says WSL retail analyst Candace Corlett. "We call her Prudence."

To land the big spenders, Wal-Mart is remodeling 1,800 stores to try to improve its much-maligned shopping experience. It's rolled out a line of urban fashions called Metro7, which include form-fitting jeans trimmed with faux fur and pleather patches. And it is adding higher ticket items like iPods and $3,000 plasma TVs. So far, the results are decidedly mixed. One of the company's most successful merchandising moves is a $4 deal on generic drugs, which plays to its regular customers who rely on its rock-bottom prices. But the fancier goods risk alienating that crowd. "They're getting too big with what they're offering," says Cincinnati social worker Becky Grome. "They need to stick with the basics." Jill Shields, a mother of four boys from Park Hills, Ky., feels the same way: "Kids’ socks, yes, but not a TV. It just doesn't feel right to buy a TV at the same place I buy groceries and underwear for my boys."

Wal-Mart actually reports it is doing well in home electronics. But it admits it is struggling to find its groove in fashions and housewares—two areas for which trendy Target is much better known. "The home and apparel business is challenging and this will continue through the fourth quarter," Wal-Mart's U.S. chief Eduardo Castro-Wright said in explaining November's sales decline, which was less than 1 percent but still significant since it was the first drop in such a long time. Wal-Mart also says its sales currently look particularly sluggish because it's up against tough comparisons with last year, when receipts were boosted by the post-Hurricane Katrina rebuilding boom.

But that Katrina phenomenon gets to the heart of Wal-Mart's conundrum. Consumers naturally think of the thrifty retailer for staples to fill the pantry, but not as a place to find a hip outfit or fine furnishings. And yet, Wal-Mart must cross over into that new territory if it wants to keep its torrid growth going—and Wall Street happy. (Wal-Mart's once hot stock is down 30 percent so far this decade; it closed at $46.48 in New York Stock Exchange trading Tuesday.) "Wal-Mart needs to figure out what it wants to be and who it wants to serve," says Sandy Skrovan, an analyst with the Retail Forward research firm.

When it comes to fashion, Wal-Mart is clearly confused. The Metro7 line sold well in some of its urban stores, so Wal-Mart rolled it out nationwide. But skinny jeans just didn't fit in its rural and suburban strongholds, where its average shopper wears a size 14. "These jeans they have now are really tight," says Shawn Wiggins, 50, of Elk Grove, Ill., who has stopped shopping for clothes at Wal-Mart. "The quality is much cheaper now, and I think the style is for younger people." Not, though, for younger people like 25-year-old Stacy Greenberg, a diminutive singer-songwriter in suburban Chicago who still isn't skinny enough to fit in those Metro7 jeans. "You have to be a size nothing and have no hips," she huffs.

But size is only one problem. Wal-Mart, which made its fortune moving a lot of merchandise, simply isn't adept at stocking stylish apparel, analysts say. "They just hang this stuff on the rack and they're all wrinkled and rumpled," says Corlett. "The item might be fun and cute, but no one will notice if it's all wrinkly."

Wal-Mart is now pulling back on its Metro7 rollout, but it's too late to save the season. Still, the lumbering giant is learning from its missteps and now plans to more carefully tailor the merchandise it sells by region. Gone are the days when Wal-Mart could just drop one of its big boxes anywhere and sell out the store on a simple formula of cheap, steep and deep. "We'll see them move away from the cookie-cutter approach," says Skrovan. "A one-size Wal-Mart no longer fits all." For now, finding the right fit is proving elusive for Wal-Mart.

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Wal-Mart loses court fight against union drive at store in Gatineau, Que.

Canoe Network
Tue, December 5, 2006                       [back to top]

MONTREAL (CP) - Wal-Mart has lost a battle in the Quebec Court of Appeal to fight the unionization of its store in Gatineau.

The world's largest retailer wanted the court to order the province's labour relations board to order a secret ballot by the store's employees. But the court refused to hear the appeal. The board ordered the certification of one United Food and Commercial Workers local after between 35 and 50 per cent of workers signed union cards.

The local withdrew its union request in May 2005. But another local submitted its request for accreditation the following day.

The labour board cancelled a union vote because the original local had withdrawn its request.

Wal-Mart challenged that decision, saying it should have been allowed to present arguments on the legality of the withdrawal.

A company lawyer said the union can't withdraw the vote without the employer's consent.

Wal-Mart spokesman Yanik Deschenes said the company is "disappointed and surprised" by the court decision and is seriously considering an appeal to the Supreme Court.

Union spokesman Louis Bolduc called the decision a victory and said the labour board can deal with the accreditation effort of the second local.

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Wal-Mart settles class-action suit

Associated Press
December 5, 2006                            [back to top]

TULSA, Okla. - Wal-Mart has settled a nearly $5.1 million class-action lawsuit brought by the estates of 73 former employees in Oklahoma. A federal judge in Tulsa gave final approval Monday to the settlement, which calls for about a third of the money to go to the plaintiffs' attorneys and for each of the plaintiffs to receive about $35,000 to $50,000.

The plaintiffs had sued to recover life insurance benefits they said Wal-Mart Stores Inc. wrongfully received upon the employees' deaths.

"It was a fair result for these Oklahoma families," said Michael D. Myers of Houston, one of the plaintiffs' lawyers.

Wal-Mart, the world's largest retailer, had taken out life insurance policies on its employees, making itself the beneficiary, and the lawsuit alleged that Wal-Mart had no "insurable interest in the lives of its rank-and-file employees."

Myers said Tuesday it may seem unusual that an employer would name itself the beneficiary of life insurance policies covering thousands of employees, but the situation is not that uncommon.

"Several million Americans are covered by these policies," he said. "Most were probably never told about the insurance on their lives, meaning that their families may not know that a claim may exist for policy benefits."

Wal-Mart chose to settle after U.S. Chief District Judge Claire Eagan decided last December not to dismiss the lawsuit.

Wal-Mart had claimed it spends millions of dollars annually to recruit, screen, train and retain its employees because its success depends on a trained, experienced work force, according to a document the judge entered into the court record last December.

The agreement to settle the case was reached this summer.

"Corporate-owned life insurance policies were products offered by life insurance companies, they were common and well-intentioned but are no longer available at Wal-Mart," company spokesman John Simley said Tuesday. "With regard to the settlement, it's the best possible resolution under the circumstances."

The $5.1 million represented 100 percent of the policy benefits Wal-Mart received from the deaths of the Oklahoma employees, according to a motion plaintiffs' attorneys filed last week.

Myers said paperwork will be sent to the class members and that the claim forms and supporting documentation will be due back by May 31.

Any unclaimed funds will be turned over to the state of Oklahoma in the name of the deceased.

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Free speech is up against a Wal-Mart

By Jim Spencer
Denver Post
December 5, 2006                          [back to top]

They came by the dozens to the Littleton City Center on Monday night. They proudly wore anti-Wal- Mart T-shirts and stickers. Many spoke. Not a one tried to intimidate. Still, in their civilized and civic-minded debate, they each made fools of overbearing politicians and bureaucrats who had tried to stifle the most fundamental American right. Last week, the powers-that-be in Littleton decreed that opponents of a Wal-Mart on Santa Fe Drive could not wear anti-Wal-Mart T-shirts or carry protest signs to a public hearing. By order of city leaders, police at a rezoning hearing ordered people to take off their T-shirts and stickers or face arrest. It took embarrassing publicity and the threat of a lawsuit to make the city relent at a continuation of the hearing Monday night. Given the open-ended - and perhaps unconstitutional - rule the city applied at the first hearing, it's not clear that Littleton's leaders get it. The rule lets the city manager restrict free expression any way he wants if he says it is "necessary for the administration, protection and maintenance ... of public buildings and property."

What distinguishes this country from the rest of the world is not free-market capitalism that lets tax-hungry towns cram big-box retailers between neighborhoods and a park. It is the ability of folks to passionately agree to disagree.

Sure, free speech comes with the responsibility to respect others. But in Littleton, a quaint burg in Denver's southwest suburbs, leaders didn't even give citizens the benefit of the doubt.

That's more important than whether Wal-Mart comes to town.

"Last week, the core group (of opponents) decided that speakers would not wear their T-shirts because we didn't want to be in-your-face obnoxious," Wal-Mart opponent Debbie Brinkman said. "We asked non-speakers to wear T-shirts in silent protest. No one was rabble-rousing."

Nevertheless, she said, the cops told anyone with a T-shirt on to take it off.

It was not the officers' fault. They followed orders from the bully-boys running Littleton. Left to deal with bad behavior instead of management's paranoia, the cops had nothing to do Monday.

Hours of testimony were a call to sleep, not a call to arms. They included endless dissections of Littleton's comprehensive plan and such narcotic bureaucratese as "sales tax leakage."

Boring? You bet. That's the only way democracy works. Everybody gets a say.

After watching T-shirt-wearing pals rebuffed last week, Brinkman and dozens of other good citizens dressed to protest Monday night. They spoke while wearing T-shirts or stickers that said "Littleton Against Wal-Mart" or "Save South Platte Park. Stop Littleton Wal-Mart."

The park, a crown jewel of the city's recreation system, sits beside the proposed Wal-Mart site. So does Brinkman's Wolhurst Landing neighborhood. She spoke for 200 of her neighbors when she told the planning commission, "This site is sandwiched between two low-profile residential neighborhoods, a busy highway on the east and South Platte Park on the west. Who would care if this (site) was rezoned and a huge cement monument to low prices was built?"

"No one wants a semi-truck turnaround outside their bedroom window," Brinkman added. "Littleton would be ... the only Wal-Mart in the metropolitan area where the neighbors' back doors are closer to Wal-Mart's front door than the handicapped parking spaces."

If that kind of attitude comes with a T-shirt or a protest sign, Littleton's leaders should live with it. Just like Brinkman and hundreds of other Wal-Mart opponents may have to live with an intrusive, big-box retailer.

If the City Council goes along with the planning staff's recommendation and approves the Wal-Mart on Santa Fe, Brinkman and other foes will try to put the issue on the ballot. If a majority of Littleton voters decides they want Wal-Mart, Brinkman said, she won't be happy, but at least she'll know that she did what Americans are supposed to do.

As long as they keep an open-ended censorship rule in their code, the same cannot be said of Littleton's leaders.

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Hercules vs. Wal-Mart

ContraCostaTimes
Mon, Dec. 04, 2006                             [back to top]

ONCE AGAIN, THE city of Hercules has given Wal-Mart the boot.

For the second time this year, the City Council voted unanimously last week to invoke eminent domain to block the giant retailer's plans to build a megastore at the future Bayside Marketplace along John Muir Parkway.

The city says it is within its legal rights to force Wal-Mart to sell the 171/4-acre parcel because the land is afflicted with "blight."

The legality of the city's use of the eminent domain law is questionable. City officials recently offered to pay Wal-Mart $14.5 million for the land --$1.5 million more than its offer earlier this year.

The hefty price tag hardly supports the argument that the land is a physical eyesore or economic drain on the city.

The matter ultimately will have to be resolved in the courts. In the meantime, the land will sit vacant and neither the city nor Wal-Mart will be able to develop it.

Yet one can't blame the city for using every weapon in its arsenal against a bully with unlimited pockets that seems determined to proceed with a development many Hercules residents want no part of.

Mayor Trevor Evans-Young and the rest of the City Council are to be commended for standing firm in their fight against the world's largest retailer in a David-versus-Goliath struggle.

Hercules residents drafted a plan for their city and what they want it to look like. Residents envision a pedestrian-friendly waterfront with small shops.

They don't want to look like every other town and city in the United States that has been overrun by big-box stores that run local shops out of business.

For that very reason, city officials set a 64,000-square-square foot-store limit at Bayside.

Wal-Mart was well aware of that limit when it submitted plans for a monster, 168,000-square-foot store. But company officials showed disregard for the local regulations.

When the city rejected that application, Wal-Mart returned with a proposal for a 99,000-square-foot store.

Which part of "no" does Wal-Mart not understand?

Wal-Mart has accused Hercules officials of acting in bad faith through their "illegal" use of eminent domain. They may be right on that score, but it is Wal-Mart that has been acting in bad faith.

If the company wants to build a store in Hercules, it needs to work with the local community, rather than attempting to bulldoze its way to what it wants.

© 2006 ContraCostaTimes.com and wire service sources.

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CPM not for Wal-Mart entry

Deccan Herald                                       [back to top]

CPM Central Secretariat member Nilotpal Basu has said his party is strongly opposed to the entry of MNCs like Wal-Mart in the retail business in the country.

He told a press conference here on Sunday that the party attached ‘tremendous’ importance to the issue of FDI in the retail business. “The Central government has stated that it is investigating whether the Bharti-Wal-Mart deal is within the existing rules”, he added but parried questions on whether the CPM would allow Wal-Mart to set up shop in the Left-ruled states of West Bengal and Kerala.

“I don’t want to answer the question when the Centre itself is investigating the issue, because if I do either way, it would amount to legitimising the deal”, he said.

He did not agree with the view that his party had diluted its stand on Special Economic Zones.

“We’ve only suggested certain changes so that the interests of farmers are protected and the land is not misused for real estate purposes. The Centre has accepted those suggestions and brought in necessary changes to the policy”.

However, on issues concerning the farmers, Mr Basu was not happy about the progress made so far. The Left Front has made it clear that food security is ‘must’.

“Those who have taken to cash crop cultivation are in trouble. “We’ve suggested certain steps but the government hasn’t yet adopted them. In fact, we want the country’s agriculture policy overhauled”, Mr Basu said.

Mr Basu strongly criticised the “principal Opposition party” at the Centre -- BJP -- for not raising its voice for “pro-people” policies in Parliament. “It is not concentrating on the burning issues of people; but is only interested in polarising the society”, he added. Left parties, he claimed, have been successful in pressurising the UPA Government “to attend to the problems of people”.

The Left was ‘instrumental’ in enacting the National Rural Employment Guarantee Scheme.

“In the last two and a half years, we’ve tried to bring issues concerning the people to the fore while strictly adhering to the Common Minimum Programme”, he remarked.

CPM State Executive Committee member Maruthi Manpade was present at the meet.

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Employees Launch Anti-Wal-Mart TV Ads

By Len Ramirez
CBS 5
December 4, 2006                                     [back to top]

(CBS 5) Wal-Mart employees are calling on their company to improve working conditions in a series of television commercials that begins airing Tuesday. Meanwhile, Wal-Mart is offering its workers incentives designed to let employees know the company appreciates them.

Wal-Mart employs over 300 associates at its San Jose Supercenter, part of its 1.3 million-person U.S. workforce.

But to many shoppers, the company's reputation for employee relations is not as famous as its prices.

"I like to shop in Wal-Mart because the prices are lower," said Angie Castro. "I find very good deals, but, really, about the employees, I don't know nothing."

Now, a labor union is trying to change that with a national television ad campaign just in time for the holidays. It features Wal-Mart employees speaking out against their employer.

"What are Wal-Mart's values? I'll tell you. Salary caps, poverty wages, unaffordable health care, locking employees in the stores," say some workers in an ad. "We even get punished if we have to leave to take care of a sick child."

The ads are funded by the United Food and Commercial Workers International Union, which does not represent Wal-Mart employees because the company is a non-union shop.

"We're not trying to unionize them," said Tony Alexander of UFCW Local 428. "What we're trying to do is make sure that people know, make sure that Wal-Mart does the right thing."

A Wal-Mart spokesman said the ads' message would fall on deaf ears.

"Our customers see these attacks as part of a tired and failing campaign. Americans know that Wal-Mart creates thousands of jobs each year," said Wal-Mart spokesperson David Tovar in a statement.

The company is also launching an incentive program to show it values its workers with perks like a 20-percent employee discount during the holidays and a special polo shirt after 20 years of service.

Wal-Mart is also setting up plans to have more regular meetings between managers and workers to talk over concerns.

The company said its new policies were not being rolled out in response to the ad campaign, but rather to build on employee relations that it says are already good.

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Wal-Mart to open stores in India

India's retail market is currently dominated by more than 12 million mom-and-pop shops

Casual Living
12/4/2006                              [back to top]

Wal-Mart Stores Inc., Bentonville, Ark., will partner with Bharti Enterprises Ltd. to open stores in India, despite government rules that prevent foreign companies from operating multi-product retail chains, the Associated Press reported. Wal-Mart has partnered with the Indian business conglomerate, which is focused mostly on telecommunications, to set up hundreds of stores across the country.

"We have signed an MoU (memorandum of understanding) for a joint venture and a franchise agreement," said Sunil Bharti Mittal, chairman and CEO of Bharti Enterprises. He declined to comment on the financial terms of the deal, but said it "will be a partnership of equals."

It will take several months before the first of the stores opens its doors. "My own wish is August next year," Mittal said, adding eventually there will be "several hundred stores across the country (that) will probably carry both brand names."

Mittal said the deal complies with existing government rules. Although India does not allow foreign companies to open multi-product retail stores, they can still make wholesale purchases to support their global supply chains.

Wal-Mart already operates a procurement center in the southern Indian city of Bangalore. The company is expected to source products worth nearly $2 billion from India for Wal-Mart stores worldwide this year.

India's booming retail market, estimated at more than $200 billion, is currently dominated by more than 12 million mom-and-pop shops. Sales through company-owned network stores currently total about $8 billion, or less than 5% of the market.

© 2006, Reed Business Information, a division of Reed Elsevier Inc. All Rights Reserved.

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Wal-Mart shoppers doing more comparison shopping

By Chantal Todé
December 4th, 2006                       [back to top]

A new survey conducted by Bigresearch for the National Retail Federation that compared Wal-Mart shoppers with Macy’s shoppers found that 38 percent of Macy’s shoppers said fluctuating gas prices have had no major impact on their spending, while only 28 percent of Wal-Mart shoppers said the same.

Wal-Mart shoppers are coping with this uncertainty by shopping closer to home (48.2 percent), taking fewer shopping trips (49.5 percent) and shopping for sales more often (42.1 percent).

In addition, 32.2 percent of Wal-Mart shoppers are doing more comparative shopping with ad circulars and 19.3 percent are doing more comparison-shopping online.

Consumers are doing more comparative shopping this year, both online and using advertising circulars, said Phil Rist, vice president of Worthington, OH-based Bigresearch, who spoke during a Dec. 1 conference call organized by NRF.

“There is a sector of the economy that has a lot of money and that will always be impulsive,” Mr. Rist said. “For the rest of the folks that are pressured by energy prices and reading about housing values, they’re not being impulsive. They’re being more practical and purposeful this holiday season.”

Approximately 60 percent of U.S. adults, or roughly 125 to 130 million people, regularly shop at Wal-Mart throughout the year, while only 9.2 percent of U.S. adults regularly shop at Macy’s, according to the survey.

The average Wal-Mart shopper plans to spend $764.09 on presents this holiday season, which is close to the national average of $791.10. Macy’s shoppers plan to spend $1,102.15.

The preferred payment method for Wal-Mart customers this holiday season is debit cards, while the preferred method for Macy’s customers is the credit card.

The survey showed the best-selling categories this holiday season will be clothing; books, DVDs, CDs and video games; gift cards; toys; and electronics

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Wal-Mart Says Thank You to Workers

By MICHAEL BARBARO and
STEVEN GREENHOUSE
December 4, 2006                                                [back to top]

Faced with public demonstrations of discontent by its employees, Wal-Mart Stores has developed a wide-ranging new program intended to show that it appreciates its 1.3 million workers in the United States and to encourage them to air their grievances.

As part of the effort, Wal-Mart managers at 4,000 stores will meet with 10 rank-and-file workers every week and extend an additional 10 percent discount on a single item during the holidays to all its employees, beyond the normal 10 percent employee discount.

The program, described in an internal company document, was created during a volatile six months period, starting when the company instituted a set of sweeping changes in how it managed its workers.

Over that time, Wal-Mart has sought to create a cheaper, more flexible labor force by capping wages, using more part-time employees, scheduling more workers at nights and weekends, and cracking down on unexcused days off.

The policies angered many long-time employees, who complained that the changes would reduce their pay and disrupt their families’ lives. Workers even staged small rallies in Nitro, W. Va., and Hialeah Gardens, Fla., the only such protests in recent memory.

The portion of the new outreach program called “Associates Out in Front” is described in company documents as a way for Wal-Mart to show workers “that we do appreciate you and that we have an ongoing commitment to listening to and addressing your concerns.”

The documents were provided to The New York Times by WakeUpWalMart.com, a group funded by the United Food and Commercial Workers union, which fears that Wal-Mart will undermine unionized stores.

The program includes several new perks “as a way of saying thank you” to workers, like a special polo shirt after 20 years of service and a “premium holiday,” when Wal-Mart pays a portion of health insurance premiums for covered employees. Sarah Clark, a spokeswoman for Wal-Mart, said the program was a “a more formalized, contemporary approach” to communicating with and collecting feedback from its fast-growing work force.

But she said it was not a response to workers’ concerns about new company policies. The Associates Out in Front program, much of which is not described in the documents, she said, “is about building on something that is already very good.”

In interviews, half a dozen Wal-Mart workers said there was a growing perception within the company that managers did not respond to employees’ ideas and complaints.

Kory Uselton, a 35-year-old overnight floor cleaner at a Wal-Mart in Tyler, Tex., said his store manager offered “robotic” company-approved responses during a recent meeting when workers questioned the new attendance policy, which originally called for disciplinary action after three unauthorized absences (although it was later revised to four unexcused absences).

Asked if absence for a family emergency, like a sick child, would be authorized, Mr. Uselton recounted, the manager said, “No, it’s not.”

“Many of the associates were very upset,” Mr. Uselton said. “Management is just not listening anymore.” Some Wal-Mart employees said workers might be afraid to speak up because they have seen coworkers retaliated against — for instance, transferred to worse shifts when they voiced their complaints.

Ms. Clark said Wal-Mart already had several systems in place that allowed employees to criticize company practices. Among other things, she said, there was a toll-free hotline workers could call to report ethical lapses, a Web site on which chief executive H. Lee Scott Jr. answered questions and a policy, known as the “open door,” that permitted anyone to bring complaints to officers at the highest level of the company.

Industry analysts and labor experts generally praised Wal-Mart’s new employee outreach effort, which they said appeared to imitate practices from companies known for cultivating a healthy relationship between managers and employees.

“When you look at the list of best employers,” said Richard W. Hurd, a professor of industrial and labor relations at Cornell University, “you will find programs that look something like this.”

The question, he said, “is how sincere the effort is and how much change you see in workers’ lives.”

But he said the perks, like the 10 percent discount and the shirt for long-time workers, are “a very token, modest form of appreciation. It is not sufficient.”

Adrianne Shapira, a retail analyst at Goldman Sachs who tracks Wal-Mart, cautioned that, whatever the reasons for the new program, the pace of change at the company carried its own hazards.

“I think they are asking a lot of their people right now,” she said. “It’s a lot of change in a short period of time at an already hectic time of year. It has to be pretty challenging for workers.”

The Associates Out in Front program, which Wal-Mart is introducing over the holiday season, was developed by company executives about seven months ago, Ms. Clark said. It is, in part, the result of recommendations from a group called the Care Council, 700 Wal-Mart workers who advise executives on ways to improve working conditions.

Under the program, store managers are to meet each week with 10 employees who sign up to discuss concerns, suggestions and ideas for improving operations. The program also requires regional general managers to conduct monthly town-hall meetings that are open to every worker in the area.

A new management training program, called “Leaders Out in Front,” is intended to encourage hourly workers to advance their careers and help existing managers become “better ambassadors and mentors,” according to the memo.

Not all of these perks are new. During previous holiday seasons, Wal-Mart has paid health care premiums and offered an additional 10 percent discount. But they were sporadic or at store managers’ discretion, rather than offered annually across the chain, said Ms. Clark, the spokeswoman.

Other perks, like a shirt that states length of employment in five-year increments starting with 20 years of service, appear designed to build morale, but might do the opposite.

Cleo Forward, a 37-year-old support manager at a Wal-Mart in Dallas, said the new program was promising, but that it fell short in recognizing long-time workers who felt unappreciated by the changes.

“They are going to spend $15 on a Polo for you after 20 years? Give me a break,” he said. “We would rather they lift the wage caps.”

Still, Mr. Forward said, he would like to be able to resolve his problems inside the company — and viewed Associates Out in Front as step in the right direction. “Maybe the company is willing to listen,” he said. “If that is so, I am happy. I want to be part of that process.”

Copyright 2006 The New York Times Company

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Wal-Mart Girds for Showdown With New Congress on Unions, Trade

By Kim Chipman and
Lauren Coleman-Lochner                                                 [back to top]

Dec. 4 (Bloomberg) -- Wal-Mart Stores Inc., long an ally of Republicans, has spent the last two years ramping up political donations to Democrats. The company will soon find out whether that bet will pay off.

The world's largest retailer will contend next year with a Democratic-led Congress with close ties to organized labor. Democratic leaders say one of their priorities is a bill opposed by Wal-Mart making it easier for workers at the non-union company to organize. Lawmakers may also block Wal-Mart's plans to operate a bank and thwart trade deals that allow the company to import goods at low prices.

Bentonville, Arkansas-based Wal-Mart says it wants to persuade lawmakers that criticism of its labor practices is unwarranted and that free trade helps consumers. The company has enlisted at least one Democratic ally, Senator Blanche Lincoln of Arkansas, and has given money to the Congressional Black Caucus, a group of 43 Democratic lawmakers.

``We're optimistic,'' says Lee Culpepper, who heads lobbying efforts in Washington for Wal-Mart. ``Our opportunity to build relationships will probably lead to an increase'' in donations to Democrats.

Wal-Mart has one of the nation's biggest corporate political-action committees, giving $1.2 million to federal candidates for the 2006 elections. While only 32 percent went to Democrats, that was up from 1.7 percent 10 years ago, according to PoliticalMoneyLine, a Washington-based company that tracks money in politics.

``One of the things we decided to do at the beginning of 2005 was to try to do a better job building relationships and political support on both sides of the aisle, but in particular with Democrats,'' Culpepper says.

Arkansas Ally

In the Senate, Lincoln is considered Wal-Mart's strongest Democratic advocate. Over the last decade, she received almost $100,000 in campaign cash from Wal-Mart, its executives and the heirs of company founder Sam Walton, according to Federal Election Commission data. Lincoln has supported the company's efforts to suspend tariffs on imported goods sold at Wal-Mart's U.S. stores.

Wal-Mart is the ``largest employer in my home state,'' Lincoln said in a statement. ``I know they understand their responsibility as an industry leader to set a higher standard with regard to employee and customer benefits, corporate citizenship and community involvement.''

Wal-Mart's attempts to woo members of the Congressional Black Caucus include endowing a $1 million scholarship grant administered by the group. Last year, eight members of the caucus who received contributions from Wal-Mart voted against a measure that would have ended the Labor Department's policy of giving the company notice before starting any investigations of alleged wage-and-hour violations. The measure was defeated.

Black Caucus

Members of the caucus, including Representatives Bennie Thompson of Mississippi and Al Wynn of Maryland, didn't return calls seeking comment.

Wal-Mart's efforts to reach out to more Democrats may not be enough to soften the anti-Wal-Mart stance of critics such as Representative George Miller of California and Senator Edward Kennedy of Massachusetts, who will head panels overseeing labor issues. Both have said they will try to pass the Employee Free Choice Act, which would force companies to recognize unions when employees sign a card expressing their desire to organize.

Wal-Mart, which has fought prior attempts to unionize its U.S. workers, says it would oppose such a bill.

Investigations

The company also may be subject to investigations of its labor practices by the labor panels, which have the power to subpoena executives, says Andy Laperriere, political economist at International Strategy & Investment, a Wall Street advisory firm.

``Wal-Mart may get the tobacco-industry treatment from this new Congress,'' Laperriere says. The company may also face opposition from newly elected lawmakers who benefited from union support in their campaigns.

Democratic Senator-elect James Webb of Virginia says Wal- Mart is a symptom of the failure of U.S. trade policy, which penalizes American workers and industries by flooding the market with cheap imports and making it too easy for companies to export jobs overseas.

Webb and other Democratic lawmakers who seek stricter labor provisions in trade deals may hurt Wal-Mart's ability to get trade-related concessions that help the company curb costs.

`Difficult'

``Trade might be more difficult'' with the new Congress, Culpepper says.

Democrats such as Kennedy say voter concerns about job security, flat wage growth and a widening gap between rich and poor were part of the reason Democrats were able to sweep both chambers of Congress for the first time in 14 years in last month's elections.

``Wal-Mart already is in the crosshairs of a lot of Democratic gunslingers these days, and we can expect a lot more rhetoric about the company being irresponsible,'' says Robert Reich, secretary of labor under former President Bill Clinton.

For now, Wal-Mart, the country's largest private employer, says it supports one of the Democrats' top priorities -- raising the national minimum wage of $5.15 an hour for the first time in almost 10 years. Chief Executive Officer H. Lee Scott has said an increase would be good for his customers.

Democratic leaders have said they will try to pass a minimum-wage measure in the first 100 hours of the new session in January.

Banking Application

One of the company's first congressional fights may center on its application with the Federal Deposit Insurance Corp. to own an industrial bank.

Representative Barney Frank, the Massachusetts Democrat who is in line to become chairman of the House Financial Services Committee, has said he opposes allowing commercial companies such as Wal-Mart to own industrial banks, which offer services such as processing credit-card transactions.

``There's a sense that when they do expand into a field, they start a race to the bottom,'' Frank said in an interview earlier this year.

Culpepper says he expects the FDIC to announce a decision in January and won't comment until then. The company says it wants to own a bank so it can save on the fees it pays third parties to process transactions.

The 2008 presidential race may bring new headaches for the company. So far, at least two Democrats considering White House runs, Senator Barack Obama of Illinois and former Senator John Edwards of North Carolina, have criticized the company's wages and health-care benefits.

`Vital' Battle

``The battle to engage Wal-Mart'' is ``absolutely vital,'' Obama said on a Nov. 15 conference call hosted by Wake-Up Wal- Mart, a Washington-based group funded by labor organizations. Culpepper says he met with Obama before the call, though he declined to comment on what was said. Obama spokesman Tommy Vietor says the company tried to persuade the senator that his views about the company were misguided.

Edwards last week refused to hold a book signing at a Wal- Mart in Manchester, New Hampshire, choosing a nearby Barnes & Noble instead -- even though the book store pays its employees $7 an hour to start, less than the $7.50 an hour paid by Wal-Mart, according to the Manchester Union Leader newspaper.

``Democrats running for president are lining up to bash Wal- Mart because they want the support of the unions,'' Laperriere says.

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Wal-Mart again tops Washington state health care subsidy list

The Associated Press                                      [back to top]

TACOMA, Wash. (AP) -- Wal-Mart again has been listed as having more workers on Medicaid and Washington's Basic Health Plan than any other private employer in the state.

According to a state compilation of enrollments in June, Wal-Mart had 3,194 employees in the two taxpayer-subsidized health care programs out of 16,000 employees in the state, while McDonald's was second with 1,932 and Safeway - also with a work force of about 16,000 in Washington - was third with 1,302.

By comparison, the figures in a confidential report for 2004 showed Wal-Mart with 3,180 workers in taxpayer-supported health care programs, McDonald's with 1,824 and Safeway with 1,712.

Union leaders and their supporters around the country have sought legislation to require that large employers spend at least 9 percent of their payrolls on health care or pay the difference to help finance state health care plans. Otherwise, they have argued, businesses essentially can push health care costs onto taxpayers.

A bill that was enacted in Maryland was struck down in federal court this summer. A similar measure died in the Washington Legislature after House Speaker Frank Chopp, D-Seattle, refused to advance it.

The report presented to legislators Thursday estimated that assistance for Wal-Mart employees will cost the state around $9 million this year out of a total of $600 million for all workers in Washington who receive such aid.

"I hope this report will serve as a kind of catalyst," said state Rep. Steve Conway, D-Tacoma, chairman of the House Commerce and Labor Committee and secretary-treasurer of United Food and Commercial Worker's Union Local 81.

When the earlier report was leaked last spring, Wal-Mart officials said the Bentonville, Ark., company's health plan had improved since 2004.

Wal-Mart spokeswoman Jennifer Holder questioned the latest figures.

"I don't think its an accurate picture of who is using the system most," Holder told The News Tribune on Thursday.

She also said Wal-Mart hires many people who are on public health assistance and has found some are reluctant to switch health plans.

© 2006 The Associated Press. All rights reserved

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Gas prices still big concern for Walmart shoppers 

By Aarthi Sivaraman                                  [back to top]

NEW YORK, Dec 1 (Reuters) - Fluctuating gas prices may be driving away shoppers and affecting sales for discount retailer Wal-Mart Stores Inc. <WMT.N>, which reported disappointing November same-store sales this week, according to a survey commissioned by the National Retail Federation.

About 28 percent of Wal-Mart consumers said fluctuating gas prices had impacted their spending, according to Phil Rist, vice president of BigResearch, which conducted the survey for NRF, in a conference call on Friday.

"The real issue we are seeing is still the impact of gas prices. And even though gas prices are down from last year of post-Katrina of over $3 a gallon, they are still high and still fluctuating," Rist said, referring to Hurricane Katrina.

About 125 to 130 million people shop at Wal-Mart annually, and nearly half of them said this year that they had cut down on their trips to the store or that they were shopping closer to home to spend less on fuel, he said.

Wal-Mart, the world's largest retailer, said on Thursday that its November same-store sales fell 0.1 percent, their first monthly decline since April 1996.

The Bentonville, Arkansas-based retailer has not been able to beat last year's strong sales performance, which shot up after the hurricane season.

Wal-Mart also said it did not expect any big improvement in December same-store sales, which would likely be flat to up 1 percent. That is still below the 2 percent growth analysts said was needed for the company to meet its fourth-quarter sales forecast.

How much shoppers spend at the world's biggest retail store depends on how much money they make, Rist said. Wal-Mart regulars, on average, make $48,500 a year, $24,000 less than those who frequent Federated Department Stores Inc.'s <FD.N> Macy's and earn an average of $72,500 annually, Rist said.

Macy's shoppers are also feeling more confident this holiday season and are using their credit cards more often, whereas many Wal-Mart shoppers are sticking to debit cards, Rist said.

This year, fewer shoppers are going to discount retailers, while more are going to department stores, according to the survey.

Wal-Mart shares fell 23 cents, or 0.5 percent, to close at $45.87 on the New York Stock Exchange. The stock reached a 52-week high of $52.15 on Oct. 23.

© Reuters 2006. All rights reserved.

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Prisoners of envy: Wal-Mart nihilism versus the punk rock of blogging

By Phil Rockstroh
Commentary - Online Journal
Dec 1, 2006                                                            [back to top]

The Holiday Season has arrived, unfolding before us, like a cheap vinyl wallet, here in the United States of American Express. The days spill forth, their hours comprised of shopping and shooting sprees, of retail and retaliation. Jingle Bells and the crackle of gunfire. This is the way an empire falls, with armies of confused killers abroad and legions of killer clowns at home.

A decade and half ago, we watched smugly as the Kremlin came undone. Yet, somehow we believe ourselves to be immune from the rot that causes empires to collapse from within.

The Social Realist poets of the former Soviet Union made themselves the objects of much (deserved) derision, when, in the service of the dogmatic dictates of state communism, they penned poetic odes to crop yields, tractors and other farm implements.

When a Russian attempts to convey his passions, his soul is prone to reach inward seeking poetic depths. In contrast, nowadays, in situations of crucial importance, such as the anxious waiting in long lines involved when attempting to procure PlayStation 3s among the throngs of their fellow Home Entertainment Unit-lusting Fred C. Dobbs types, Americans express their ardor by reaching for a gun. For we all know, the Baby Jesus would find the sound of Yuletide gunfire to be as soothing as a celestial lullaby.

Back down here on earth, while it was damn silly for Soviet aesthetes to go into a poetic swoon over farm equipment, somehow the act of going collectively round-heeled over electronic appliances (including jealous rages that lead to homicidal outbursts) doesn't seem like the sort of communal practices that will allow an empire to endure for long.

The former Soviet Union had the risible excesses of her Social Realists, but what is one to make of our culture of Wal-Mart Nihilists. Although, these acts are revelatory: These are the kinds of "crimes of passion" that contemporary Americans perpetrate. Such actions reveal what it is we truly care about, deep down. And, sadly, our concerns have little to do with being the keepers of Liberty's flame -- or even being good stewards of our children's future.

The frustrations of a life defined by the narrow confines of corporatism produces these lethal states of mind, whereby the homicidal urges that are encoded into the genetic makeup of all human beings become magnified into impulses both monstrous and preposterous: Resultantly, many Americans view life and death issues as having the weightless consequences of a thrill-kill video game.

Yet, most citizens of our moribund republic, because they've internalized the system, remain in denial regarding the authoritarian deathscape the nation has become. Moreover, they have nothing to contrast it with . . . What they feel is a sense of underlying unease which the consumer state (palliatively) remedies with meds and media distractions. What else could drive people insane enough to shoot each other over consumer goods? Not to mention the emptiness and desperation involved with the compulsion to line up lusting after electronic junk in the first place. I just want to shout out to such folks: I'm so sorry your life has come to this.

And don't bandy back at me inane platitudes such as, "these are the necessary risks and excesses inherent to 'the free market' system" -- and other such manifestations of willful ignorance and flat-out deceit. Your so-called free market has caused our nation to become imprisoned in debt, including our collectively becoming obeisant to China, who now owns our shabby asses and dwindling assets, like some global village pawn broker, by the purchase of our national debt.

(And we know those in positions of power in China lie awake at night ruminating on the well being of the citizens of The United States. Yes, probably about to the same degree Dick Cheney lies awake at night agonizing over the effect of a blast of buckshot delivered to the face of an elderly hunting companion.)

To escape the knowledge of our enslavement and its concomitant sense of powerlessness, emptiness and hopelessness, we have become obsessed with the pursuit of piffle. Yet we cannot consume away the pervasive sense of unease. Moreover -- following Eric Hoffer's dire dictum -- "You can never get enough of what you really don't want" -- we're driven to "develop" more soulless subdivisions, open more lifeless Big Box stores and compulsively throw ourselves into the thrall of even more mindless consumerism.

Ivan Illich averred: "In a consumer society there are inevitably two kinds of slaves: the prisoners of addiction and the prisoners of envy." Hence, like all hopeless addicts, in reality, what we're seeking is the serenity of the grave.

Look at the evidence: We're engaged in an ongoing act of murder/suicide by our engagement in a state of perpetual war termed the War on Terror. In this way, our unconscious wishes are being granted in Iraq and Afghanistan -- and we're, most likely, not done yet. Accordingly, our need to relieve our sense of emptiness and powerlessness has grown so insatiable that we roam the world, relentlessly, in search of the means of mollification: But wherever we go, we leave a wasteland in our wake, including the manner in which we have fouled our own nest.

Furthermore, I'm willing to hazard a guess that neither industry, nor thrift, nor a PlayStation 3's razzle dazzle, nor another round of lowered interest rates, nor a surge of consumer spending, nor a miracle military victory in Iraq, nor a sleepless fleet of terrorist-spotting spy satellites in space, nor a billion surveillance cameras trained on every person, place and thing on the planet could keep the oceanic vicissitudes of earthly existence from rising, nor the gales of contretemps from blowing, nor the casuistry-sundering storms of uncertainty from making landfall and could, at this late date, keep the American Empire from collapsing from the rot festering within its spoiled rotten populace.

This is due to the sad fact that, thus far, all our attempts to defeat our feelings of powerlessness and sate our emptiness have been vain, shallow, self-serving and authoritarian; hence, our acts have only managed to defeat and suppress the life-vivifying forces of freedom and imagination within us. We may give lip service to Jesus, but we outright worship the spurious Eros of the corporatist advertising/entertainment/consumer paradigm -- and it has risen before us as manifest Thanatos.

In spirit-desiccating accommodation to this punitive and petty age, we have merely managed to submerge our fires of authentic human passion. This is a gambit fraught with hidden danger. I've heard stories of fires that burned unseen in sealed-off, abandoned mines -- wherein years later, miles from the original location of the blaze, dead trees burst into flames . . . the fire having traveled underground the length of the mine and up the dry kindling of the tree's root system to explode in open air. We witness these sorts of sudden conflagrations, constantly: road rage, workplace and school shooting sprees, spittle-spraying right-wing pundits, George Bush's oscillations between dead-eyed blankness and prickly anger (I don't know which state is more terrifying) and a culture that willingly accepts the outright murder of civilians for no discernible reason. As if there exists a good one.

If the fires of passion burn, unseen and untended, in subterranean denial, how can an individual or a culture learn to temper those raging fires of passion into warmth and compassion? Hence: the coldness of the corporate culture and the lifelessness of existence in contemporary America, resulting in chronic dissatisfaction (the feeling something is missing) and the attempts to ameliorate the discomfort with the dark Eros of perpetual war and enslavement to the shallow distractions of the consumer state.

The fire, next time -- indeed.

The corporate media is never going to level with you on the subject: It would put them out of business. Such a development is about as likely as the arising of a mass social movement, led by pimps, called, "The Pimps' Crusade For The Promotion of Universal Abstinence."

Accordingly, in our shallow and self-defeating era, a million lies are told; a million promises are broken. The poor starve; the rest of us rot from within. As everything we hold precious is imperiled, we engage in a planet-destroying struggle for the attainment of junk.

Yet, it need not play out this way: For our minds are honeycombed by multiple universes of possibilities, ideas, and imaginings. Accordingly, we sense that the "information" we receive from the commercial media, official Washington, and the business sector is far from complete; that it is merely a few, meretricious fragments of a subjective account, splintered from a small shard of a hasty conclusion, broken from a vast mosaic of a larger prevarication.

But like the dimwit protagonists of a Country and Western song, too many of us plead to be plied with sweet lies. Pervasive corporatism creates the illusion we have little choice in the matter. Freedom is no more available to us than finding undying love in a Honky Tonk.

Moreover, the ideas contained in the Bill of Rights and the tenets of The Enlightenment are quaint notions to corporatists. Within our empire of mammon, cant and incommensurate privilege, concepts such as freedom and liberty lie forgotten, languishing like the statues of forsaken gods within the crumbling temples of some dead religion.

I often receive emails from readers who ask, in essence: And what of those of us -- those who remember and grieve our republic's passing? Is there some place of sanctuary where we could rally our spirits; a place where we might gather our strength -- where we might have a rapprochement with our own hopeful hearts, where we might rise in the cool air of morning in some location no longer haunted by the malicious and manipulative spirits who have usurped our names and stolen our country? Is there any place on earth where we might dodge the mind-grinding, soul-killing, death-worshipping legacy of the militarist/corporatist/consumerist state?

Don't you see, Phil, these readers implore and admonish me, we're besieged and outnumbered by the mindless worshippers of Death around us? And, by the way, fella, your incantatory prose will not move, nor even interest them.

I'll answer these entreaties by quoting from a documentary, "Punk: Attitude," I viewed, recently, in which independent filmmaker Jim Jarmusch posited that art movements (and political ones, as well) don't need the masses, they just need a committed 5 percent . . . the masses will follow. There is no need to inform the mob; a mob, by its very nature, is uninformed -- and unteachable. The belief in the existence of an informed mob is like believing in the existence of that chimera called compassionate conservatism and we've seen where credulity to that sort of crazy talk leads.

As was the case with Punk, which Jarmusch termed, "do it yourself art" -- one needs passion, commitment, conviction tempered by an ability to apprehend and uniquely interpret changing realities and circumstances, plus an inner reservoir of courage and follow through. These things can't be bought retail: And that is exactly the advantage we hold.

Hence, it might be instructive to look at the mode of being evinced by the pioneers of Punk Rock . . . Tired of endless guitar solos and of Arena Rock and Roll's egomaniacal inanities, they learned to play three cords -- real fast -- and would play for little or no money in shot-out downtown clubs, thereby, reintroducing the danger and allure of the subversive intimacy of early Rock and Roll to a new generation and forever establishing the enduring principle that being an imbecilic Rock and Roll egoist should be a democratic process, not limited to only corporate, guitar technocrats (or even those individuals possessed of the tyranny of talent).

Point of clarification: I'm not speaking here of literally becoming a punk rocker. (Although, a convincing argument can be made that: independent websites and blogs are the new Punk Rock.) I'm talking about the initial passion of the progenitors, not the conformist banalities displayed by their mindless followers . . . I'm speaking of the mode of being of the folks who created the art form, not the hollow mimicry of those who mummify it into dogma.

The do-it-your-self-art idea being the key that unlocks the barred door of the commodified prison of a corporatist state of mind and allows one's life to be created, not by narrow careerist agendas but by the surrender to all it takes to be free.

To do this, sometimes, you must follow your inspiration so far off the path you have to blaze your own path to make your way back.

It's not the outcome of your endeavors, but the life lived. If you live with such ardor, who knows who and what you'll effect. We must be like the monks of The Dark Ages, copying books for generations yet unborn, preserving what we can of our humanity and passing it on.

I believe hope arises in organic ways before it makes its way into political platforms, is implemented into policy, and, finally, imprisons us in dogma, thus allowing a new generation to engage in the soul-making of sedition against its ossified order.

Let's get to it.

Or else, pack your firearm of choice and line-up for a PlayStation 3. Although it's all good: Because, someday, an era may arrive when sanity prevails and future generations will have a nice laugh at your expense -- a generation of clowns who would kill (even destroy the world) for an appliance.

Copyright © 1998-2006 Online Journal

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Bharti will be benefitted from Wal-Mart

Murthy
PTI
FRIDAY, DECEMBER 01, 2006                         [back to top]

BANGALORE: Chief Mentor of Infosys N R Narayana Murthy on Monday supported the Joint Venture between Bharti Enterprises and Wal-Mart, saying the Indian partner would benefit from the world's largest retail chain's expertise and technology.

"What's unique about Wal-Mart is its ability to leverage the power of technology for bringing in efficiency..bringing in customer comfort in an unheard of manner", the non-executive chairman of the Bangalore-based software major said.

"...that technology..that expertise and that environment will be made available to Indian partner", Murthy said in response to questions at a press conference on the sidelines of an international conference on 'managing technology innovation in IT', organised by the Institution of Engineering and Technology (IET) here. "It's a very important progress".

He said the NASDAQ-listed firm draws 15 per cent its revenues from the retail sector, adding, it works with all 'famous retail names', including Tesco and Wal-Mart.

Bharti announced last week that it had signed a Memorandum of Understanding with Wal-Mart Stores Inc, for the telecom major's foray into the retail segment

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Wal-Mart's Woes

By RACHEL BECK
The Associated Press
Friday, December 1, 2006                          [back to top]

NEW YORK -- Remember when Wal-Mart was talked about as the retailer where America shopped? At least in recent months, it looks like consumers increasingly have taken their money elsewhere.

Wal-Mart Stores Inc. should be a dominant force during the all-important holiday season, but instead it has tallied terrible results. Its same-store sales fell for the first time in a decade in November and it is forecasting anemic growth this month as well.

Blame for such missteps can't go just to the slowing U.S. economy. Wal-Mart's reputation as a difficult employer and the growing perception that it doesn't always offer the lowest prices have led consumers to shop at competitors of the world's largest retailer.

Given Wal-Mart's size and power, what it does matters. With more than 6,600 stores worldwide and sales for 2006 estimated to average out to just under $1 billion a day, the Bentonville, Ark., discount chain has long been considered an industry and economic bellwether.

But its recent woes show a vulnerable side to this retailing behemoth. Maybe Wal-Mart's problems are just Wal-Mart's problems.

Its November same-store sales dipped 0.1 percent, marking the third consecutive month of disappointing results. Those weak sales came despite Wal-Mart's price cuts on toys, electronics and other items in an attempt to draw shoppers.

For the heart of the holiday season, Wal-Mart is expecting December same-store sales to be flat to no more than 1 percent higher than a year earlier. The company blamed weak sales of apparel and a slump in its home furnishings business.

The initial take on Wall Street earlier in the week _ when Wal-Mart tipped its hand that November wasn't looking good _ was that the weakness was symptomatic of a slowdown in overall economic growth. The stock market sold off on the idea that the housing market correction coupled with an uncertain jobs outlook might be spurring consumers to hold off on some spending.

But for that argument to hold up, there should be other warning signs as well _ and there aren't. Consumer spending has picked up in recent months as gas prices have dropped, and new retail sales show strong results from other merchants.

Rival discount chain Target Corp. tallied better-than-expected same-store sales of 5.9 percent in November. Shoppers scooped up its trendy offerings even though they bypassed them at Wal-Mart. The department store chains also fared well, including the 8.9 percent gain at Federated Department Stores Inc., which also boosted its December sales forecast.

"We are beginning to question if its (Wal-Mart's) sales issues are broader and more secular than we are currently being led to believe," JPMorgan retail analyst Charles Grom said.

One big issue plaguing Wal-Mart has to do with its prices. Consumers long believed if they shopped at Wal-Mart, they got the best price. And they were willing to put up with dated stores and sloppy displays so long as they were paying less.

But this year, that might not have held true. While the company has started remodeling _ which also has turned off shoppers because of the disruption to the stores _ most stores haven't been redone yet. At the same time, Wal-Mart hasn't always offered the lowest prices.

The discounter failed terribly when it attempted to attract higher-income shoppers by offering more fashionable items such as clothes that were sold at higher price points. It also shifted its advertising away from a low-price focus, but now is emphasizing cost again.

In the meantime, its competitors intensified their price-cutting on the same or similar items sold at Wal-Mart, including food and grocery items. That was especially true over Thanksgiving weekend.

Wal-Mart started discounting toys in October and electronics in early November, hoping to "gain mind share" as the low-price leader over the holiday season, according to Goldman Sachs analyst Adrianne Shapira.

But then it failed to deliver as competitors offered better deals on Black Friday and through last weekend. "The rest of the world caught up in promotions when it mattered and margins were hit across the board," Shapira said, noting that its biggest declines in customer traffic came during the week of Thanksgiving.

Also at issue is whether Wal-Mart has expanded so much over the last four decades that finding new store locations and capturing additional sales in certain categories are becoming increasingly difficult.

As Merrill Lynch's Virginia Genereux noted, Wal-Mart could have hit a "market-share wall" _ since it might not be able to see much more upside to its 30 percent of share of such things as men's underwear and pet food, or in certain markets like Springfield, Mo.

Then there is Wal-Mart's publicity problem. Two years ago, a poll of 1,800 shoppers found that 2 percent to 8 percent of respondents said they had stopped shopping at the retailer because of negative press. The findings came in a report to Wal-Mart by consulting firm McKinsey & Co.

That decline was before the recent onslaught of attacks from two union-backed groups, WakeUpWalMart.com and Wal-Mart Watch, which have gotten lots of media attention for taking on Wal-Mart's treatment of workers so publicly. Wal-Mart bashing was also popular on the campaign trail during this election season.

Wal-Mart has fought back through its own intensified public relations effort. "We continue to create jobs, advance careers and enhance communities across the country," Wal-Mart CEO Lee Scott said during the Nov. 14 third-quarter earnings call.

Of course, no one should write off Wal-Mart yet. It is big. It is strong. It is resilient. It is in many of the nation's neighborhoods, catering to many of the nation's shoppers. No other chain comes even close to the sway that it has over American consumers.

A year from now a different Wal-Mart story could be told, one of better times ahead. For that to really happen, though, the retailer might want to review how it got where it is today, and what shoppers have long looked for in its stores.

© 2006 The Associated Press

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Tiptoeing Around Wal-Mart

Matthew Rand
12.01.06                            [back to top]

Wal-Mart has a reputation for crushing its competition on pricing. But find a retail business that can survive Wal-Mart’s onslaught, and you’ve likely found a stock winner.

The fabrics business illustrates. For years, thread-sellers have been spinning yarns about Wal-Mart (nyse: WMT - news - people ) getting out of the fabric-by-the-yard business. Inventory is expensive and turns slowly, and the store has to employ people to cut the fabric for customers, all contrary to Wal-Mart’s fast-turning and low-overhead mantra. Laura Richardson, a crafts, home décor and leisure analyst with BB&T (nyse: BBT - news - people ) in Vienna, Va., says that now the rumors are true: Wal-Mart told suppliers to expect the chain to close fabric departments in 80% of its 3,000 stores, starting in January. Wal-Mart denies the shutdowns.

Result: Jo-Ann Stores (nyse: JASA - news - people ) and Hancock Fabrics (nyse: HKF - news - people ) are well-positioned for gains. There are 2,165 Wal-Mart stores within 30 miles of Jo-Ann’s 815 stores and 1,815 Wal-Marts within 30 miles of Hancock’s 401 outlets. That is a considerable weight off their shoulders and a potential $540 million in annual sales that non-Wal-Mart stores can divide amongst themselves, says Richardson. She expects Jo-Ann to pick up $69 million of those revenues (4% of its 2005 sales) and Hancock $56 million (13% of its 2005 sales).

Jo-Ann Stores shares are now valued at 0.3 times sales. That’s expensive relative to the stock’s five-year average sales multiple but compares favorably for an industry aggregate of 0.7 for North American specialty stores. Hancock Fabrics goes for only 0.2 times sales.

In home décor, Wal-Mart’s entry has hurt Williams-Sonoma (nyse: WSM - news - people ), the San Francisco retailer of pillows and silverware. Williams-Sonoma shares are off 27% year-to-date. Contrast that with Restoration Hardware (nasdaq: RSTO - news - people ), whose stock has climbed 48% in 2006. To combat sales declines, the seller of bedspreads and lighting has gone back to the low-ticket holiday gifts that it was known for a decade ago.

Last week, says Richardson, there were novelty gift items all over Restoration stores and long lines to buy them--visiting the stores, she says, is one of the best parts of her job. The daughter of a McCall’s pattern designer, Richardson was a crafts and home décor fan long before she got her MBA at the University of Michigan. Over the Thanksgiving weekend she used her mother’s sewing machine to put a “Pop-Tarts Crazy Good World” logo onto a T-shirt for her 6-year-old son, because they couldn’t find one in stores.

Waiting on line at Restoration, she says, she saw a definite turnaround from the past few years, when crowds have ignored the beleaguered store every time the holidays come around. “Towels and bedding are great from January to Thanksgiving, but come the holiday season, a Slinky or harmonica has a lot more gift appeal to their baby boom customer than does a towel,” she says.

Beating Wal-Mart on selling tchotchkes sounds like a challenge, but Richardson says that Restoration’s impulse gifts fly under Wal-Mart’s radar at this point, and that should mean a banner fourth quarter, good enough to make Restoration deliver the best quarterly sales growth amongst its peers. Restoration shares currently retail for 6.5 times their Thomson IBES consensus estimate of operating income for fiscal 2007 (ending in January 2008).

The accompanying table lists retailers from Richardson’s coverage area, along with their enterprise multiples. Calculate this metric by dividing enterprise value (market value plus net debt) by operating income, or earnings before interest, taxes and depreciation. Richardson likes to see enterprise multiples at ten or less.

Another consideration is the Oct. 31 leveraged buyout of crafts retailer Michaels Stores (nyse: MIK - news - people ) of Irving, Texas, for 12 times earnings before interest, taxes and depreciation, a higher number than Richardson prefers. What Bain Capital and the Blackstone Group paid for an entire comparable company in the crafts industry is a good gauge of how to value these stocks. The only stock meeting that criteria is Williams-Sonoma. If you think the company can withstand the Wal-Mart treatment, its stock looks cheap.

Home Improvement Williams-Sonoma, the cheapest of these home décor companies based on its enterprise multiple, is the most threatened by competition from Wal-Mart.

Company Price Enterprise Value* ($mil) Enterprise Multiple** EPS Growth*** Market Value ($mil)

Hancock Fabrics (nyse: HKF - news - people ) $3.19 $124 NM**** 15% $61

Jo-Ann Stores (nyse: JAS - news - people ) 19.73 670 NM 15 479

Restoration Hardware (nasdaq: RSTO - news - people ) 8.51 414 19 30 323

Williams-Sonoma (nyse: WSM - news - people ) 31.72 3,497 7 16 3,599

Prices are as of market close on Nov. 30, 2006

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Wal-mart entry in India 'as per the guidelines'

Mittal
Business Line                                          [back to top]