Article

Families File Suit After Wal-Mart Construction

Sam's Club's head to be Wal-Mart International CEO

Associated Press
Jan 31, 2009                            [back to top]   

NEW YORK (AP) — The Boss is owning up to a mistake. In an interview with Sunday's New York Times, Bruce Springsteen says he shouldn't have made a deal with Wal-Mart. This month, the store started exclusively selling a Springsteen greatest hits CD.

Some fans were critical because Springsteen has been a longtime supporter of worker's rights, and Wal-Mart has faced criticism for its labor practices.

Springsteen told the Times that his team didn't vet the issue as closely as he should have, and that he "dropped the ball on it."

Springsteen went on to say: "It was a mistake. Our batting average is usually very good, but we missed that one. Fans will call you on that stuff, as it should be."

Springsteen released his new CD "Working on a Dream" this week and is performing the halftime show at the Super Bowl.

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Wal-Mart Doesn't Make the Cut

WakeUpWalmart.Com
January 29, 2009                           [back to top]  

Forbes has just released their list of the top 100 companies to work for. Guess which large retailer wasn't on the list...if you said Wal-Mart, you're right! Forbes compiles the list every year and uses pay, opportunities for growth, rates of layoffs, benefits, treatment of women and minorities, and low turnover as criteria. It is no surprise, then, that Wal-Mart wouldn't be on the list. They rank poorly in nearly all of those areas. Their executives may be making the big bucks, but most employees are making average hourly wages for retail work. Wal-Mart also gets exceedingly low marks in the benefits area, where health care is either inadequate or too expensive to afford, and other benefits are scant. Treatment of minorities and women gains Wal-Mart no points either, particularly with ongoing lawsuits for sexual and race discrimination. Yes, all around Wal-Mart is no model of a top company to work for. In fact, it's quite the opposite.

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British retailer to create 7,000 jobs

Associated Press,
01.28.09                               [back to top]  

British retailer ASDA Group Ltd., part of U.S.-based company Wal-Mart, said Wednesday it would add 7,000 jobs in Britain and recruit 3,000 long-term unemployed for existing positions, bucking the country's dismal retail climate.

The company said 3,700 jobs would be created at nine new food stores, five new non-food retail outlets and expansions of 15 other stores. The other positions would come at its home shopping unit ASDA.com and others through growth of existing businesses.

The world financial crisis and a collapsing real estate market have sent Britain into a recession, with the economy shrinking 1.5 percent in the fourth quarter and several retailers going into liquidation or reorganization after a disappointing Christmas shopping season marked by heavy discounting. Nonetheless, some large retailers have been adding jobs.

Leeds-based ASDA, which is Britain's No. 2 food seller behind Tesco (nasdaq: TESO - news - people ), employs 160,000 at 356 stores, including its ASDA/Wal-Mart Super Centers, ASDA Superstores, ASDA Living and George clothing stores. In addition to food and clothing, ASDA sells CDs, books, videos and housewares. It was bought by Bentonville, Arkansas-based Wal-Mart Stores (nyse: WMT - news - people ), Inc. in 1999.

Copyright 2008 Associated Press. All rights reserved.

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Associated Press,
01.27.09                               [back to top]  

Soft drink company Cott Corp. on Tuesday said it is phasing out an exclusive supply agreement with Wal-Mart Stores Inc., the world's largest retailer.

In June, Wal-Mart (nyse: WMT - news - people ) cut the amount of shelf space it allocated to Cott (nyse: COT - news - people )-made drinks earlier earlier in the year. Cott makes the retailer's Sam's Choice soda brand.

On Tuesday, Cott said it has been advised by Wal-Mart that the retailer wants to end its 10-year-old supply agreement. The termination is effective in January 2012.

Cott said conversations with Wal-Mart are ongoing, but the impact this move will have on its business is "unclear" at this time.

A representative for Wal-Mart could not be immediately reached for comment.

Shares of Cott dropped 23 cents, or 18.6 percent, to $1.05 in morning trading. The company's brands include Cott, RC, Vintage, Vess and So Clear.

Copyright 2008 Associated Press. All rights reserved.

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Wal-Mart teams with suppliers to lower phosphates

Associated Press,
01.26.09                                 [back to top]  

Wal-Mart Stores Inc. said Monday that it will work with its suppliers to try to reduce the amount of phosphates in laundry and dish detergents sold in some of its stores by 70 percent by 2011.

Phosphate compounds are a water pollutant, which can damage the aquatic ecosystems.

The company said it aims to make these changes in its second largest business unit, which includes Canada, Puerto Rico, Mexico, Central America, Brazil and Argentina, encompassing more than 2,300 stores.

Wal-Mart (nyse: WMT - news - people ) said it will work with detergent suppliers to determine the amount of phosphates that are currently on its shelves and then work with suppliers on how to reduce that amount.

Shares of Wal-Mart rose 25 cents to close at $48.60 Monday.

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Easton woman suing Pohatcong Township Wal-Mart for sexual harassment

Lehigh Valley Express-Times
January 24th, 2009                             [back to top]  

Amid an economic downturn, discount retailer Wal-Mart has been performing better than its peers, continuing to profit while others lose money.

An Easton woman who used to work at Wal-Mart's Pohatcong Township store may be looking to cut into the chain's profit. She is suing Wal-Mart for sexual and other workplace harassment.

In the lawsuit, Yuneysi Hernandez alleges the store's night manager directed crude, sexual remarks at her and routinely led her to secluded areas where he'd direct her to bend over and pick up boxes.

In one instance, the manager, identified as Sean Willits, wrapped his arms around Hernandez from behind and lifted her up, ignoring her protests, the suit says.

The store twice adjusted Hernandez hours, moving her to a day shift, but never fully addressed her reports of harassment, the suit says.

Wal-Mart hopes to open Patterson store

by John Saiz
Patterson Irrigator
Friday, 23 January 2009                 [back to top] 

The national retail behemoth has filed an application with the city to build what would be Patterson's biggest store. Representatives with Wal-Mart filed an application with City Hall on Friday to locate a store at Sperry and Las Palmas avenues.

Plans state the 158,173-square-foot facility would have a large area for groceries, space for a pharmacy and would be open 24/7. If built, the store would be the largest retail development in Patterson.

“We have continued to monitor Patterson for some time,” Wal-Mart spokesman Aaron Rios said. “We believe the population in the area would support it.”

Before the store becomes a reality, there are a series of hurdles to negotiate. City planners are reviewing the application and will eventually determine if the project requires an environmental impact report — a lengthy and often costly study that describes the project and its effects on issues like traffic, wildlife and air quality.

A project of this size would likely need an environmental impact report, though it won’t be known for certain until staff has time to review the application, said Rod Simpson, director of the Patterson Community Development Department.

PATTERSON’S FUTURE?  Wal-Mart has submitted an application to build a proposed 158,000-square-foot store on this lot off Sperry Avenue. The proposed store, shown in an artist’s rendering below, would be the city's biggest retail outlet. Photo by James Leonard The Wal-Mart would be adjacent to the recently constructed Taco Bell and Longs Drugs in the Patterson Plaza retail center. Plans indicate space for four other 5,000-square-foot buildings nearby, which could be used for other stores.

Sperry Commercial LP owns the land the store would go on. Joe Hollowell, a representative of Sperry Commercial, said they’ve been in talks with Wal-Mart since late 2007. In the fall of 2008, he said it looked like the company was serious about submitting an application. If plans continue to go forward, Wal-Mart intends to purchase the land, he said.

The Patterson Wal-Mart would be the largest in the county. Two Modesto stores tally in at 124,170 square feet and about 117,000 square feet; a Ceres store is 140,523 square feet; and a Turlock store is 135,351 square feet, according to the county assessor’s office.

The facility would also dwarf stores on the other side of Sperry Avenue. Save Mart Supermarkets is about 49,500 square feet, less than one-third the size of Wal-Mart. The portion of Wal-Mart dedicated to groceries alone would be almost that size, at 33,047 square feet.

Wal-Mart’s marketing campaign has already kicked off. Shortly after the Irrigator reported Tuesday on its Web site that a Wal-Mart application had been filed, a Patterson Wal-Mart Web site was unveiled.

Portions of the site are dedicated to generating support for the proposed project, including letter-writing campaigns to newspapers and city officials. Several people who visited the site reported they received e-mails from Wal-Mart shortly thereafter, even though they did not provide their addresses.

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Wal-Mart Adds Chile To Its Mix

Miriam Marcus,
Market Scan
01.23.09                              [back to top] 

Retailer acquires controlling stake in Chilean grocer D&S. Wal-Mart Stores, Inc. 01/26/2009 1:26PM ET$48.85$0.501.03%

The quintessentially American retailer Wal-Mart Stores extended its reach abroad on Friday, closing a deal to acquire control of a Chilean retailer.

The Bentonville, Ark.-based compoany said its December tender offer to buy a 58.2% stake in Chilean retailer Distribucion y Servicio D&S (nyse: DYS - news - people ) successfully closed on Thursday, furthering Wal-Mart’s international strategy of focusing on “portfolio optimization, global leverage and winning in every market.”

The 40.8 cents per common share friendly offer values D&S at $1.5 billion, analysts said. Ibanez Scott and Nicolas Ibanez Scott, sons of founder Manuel Ibanez Ojeda, will retain 40.1% of D&S shares, leaving 1.7% held by the public.

"Partnering with D&S, with its strong brands and its position as Chile's largest food retailer, is an important step in implementing Wal-Mart's international strategy," said Craig Herkert, Wal-Mart’s chief executive of the Americas.

Wal-Mart launched its bid for all of the issued and outstanding shares in D&S, including American depositary shares, in December. The original tender offer valued D&S at $2.7 billion. The final results of the offer, including the actual number of shares tendered to Wal-Mart, will be revealed on Sunday, TradeTheNews.com reported. Still, Wal-Mart has effectively taken the company private.

"It is a lot to have secured," said Antonio Cruz, a retail analyst at Santander's research arm GBM. "The liquidity of D&S’ share will fall sharply."

D&S controls one-third of Chile’s supermarket industry, operating more than 180 supermarkets, hypermarkets and convenience stores, 10 shopping centers and 85 financial services branches, with more than 34,500 associates.

Wal-Mart Stores (nyse: WMT - news - people ) already has a global procurement office in Santiago and exports Chilean products to its stores throughout the world. The discounter has been shifting focus away for mature markets in favor of its international business, its fastest-growing division, and emerging markets like Brazil and India. (See "Wal-Mart's Eastern Bloc Czar.")

Similarly, GlaxoSmithKline (nyse: GSK - news - people ) said Friday it would buy a portfolio of drugs in emerging markets for $667.2 million to counteract weakening results in developed nations. (See "Glaxo Grows Off The Beaten Path.")

The D&S takeover may prompt more consolidation in Latin America’s supermarket and grocery industry, particularly in the southernmost countries of the continent, where players are battling for market share in a retail sector that is maturing.

Analysts say Chile-based retail rival Cencosud (other-otc: CSUDF - news - people ) , which operates supermarkets, department stores and home improvement stores, probably is most at risk with Wal-Mart's arrival in Chile.

"Wal-Mart is a retailer which is known for its efficiency and for passing that efficiency on through prices, so it is tough competition," Cruz said. "The market is already pretty competitive," he added, "and this will now increase."

Shares in Wal-Mart closed down 1.1%, or 52 cents, to $48.35, in trading in New York.

The Associated Press and Reuters contributed to this article.

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Greece Walmart foes appear in court

By Jessica Spies,
MPNnow.com
January 23rd, 2009                           [back to top] 

The case of the Northgate Walmart Supercenter was in court Friday, and a decision is expected in six weeks to four months.

The community group that has sued the town over the project, Residents Against Walmart (RAW), has also appealed a decision by state Supreme Court Judge John Ark this past April that said the town’s approval process was a “thoughtful” one.

Donn Rice, spokesman for RAW, said based on what happened in court Friday, the group’s attorney — David Seeger — said RAW is “still in the game.” Eight members from the group were in court.

The plans for Walmart at Northgate Plaza were approved by the town planning and zoning boards in September 2007. RAW later sued the town over the decision and also sued DeWitt-based The Widewaters Group, which manages Northgate Plaza. RAW members said Widewaters has been a poor owner in terms of keeping the Northgate area vital.

In the lawsuit, RAW claimed the boards overlooked the impact the Walmart addition would have on traffic, the environment and the neighborhood.

Ark ruled in April that the town did its job and said the court can’t “overrule the thoughtful decision making of the boards.”

An attorney from Walmart argued Friday that RAW does not have standing.

“They have had their day in court and it was dismissed on proper ground,” he said.

Widewaters’ approval was for a 146,000-square-foot supercenter at the aging Dewey Avenue plaza. Besides a 24-hour Walmart, the project calls for a McDonald’s, a bus shelter and demolition of the plaza’s south wing and rehabilitation of its north one.

Though Northgate Plaza is in a commercial area, the area behind it is residential. Critics say big-box stores like Walmart belong on West Ridge Road, not Dewey Avenue.

They also argue that there is no need for two Walmarts in one town; there is already one on Ridge Road. Supporters say the store will help rejuvenate the aging, mostly vacant plaza.

A decision on the case isn’t expected until mid-March at the earliest, and could take up to four months.

“We are fighting for the rights and quality of life in our part of Greece,” Rice said.

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Woman sues Wal-Mart after stampede

By BILL MASON
AND JOIE TYRRELL,
Newsday
January 23rd, 2009                    [back to top] 

The family of Jdimytai Damour, the Wal-Mart employee killed in a shopper stampede at Wal-Mart in November, found some comfort knowing that he died helping another, their attorney said Friday.

A South Jamaica woman who was five months pregnant at the time of the stampede at the Valley Stream store recently spoke out crediting Damour, 34, with saving her life and that of her unborn daughter.

"The family takes some measure of solace that at the end of his life, he was helping someone else," said Andrew Libo, a Manhattan-based attorney representing Damour's family. "It doesn't surprise them. He was always looking out for other people."

Leana Lockley, 28, said she did not know where she could contact Damour's family, but she said: "I would like to give my condolences to them on the death of their son and my appreciation in him saving my life ... and also the life of my daughter."

Lockley's lawyer, David Sloan, of Hicksville, has said that Wal-Mart failed to provide proper crowd control and they are preparing a lawsuit against the store. Libo said the Damour family is also planning a suit against Wal-Mart, the security company and the Green Acres Mall where the incident took place.

If Lockley files suit against Wal-Mart, she will not be the first to do so. Last month Emmanuel Moultrie, of Jamaica, Queens, filed suit saying store managers ignored dangerous conditions, Moultrie's lawyer, Ken Mollins on Melville said.

Another attorney, Bruce Baron of Brooklyn, also filed lawsuits on behalf of two people: Theresa Sgro, who says her 14-year-old daughter suffered multiple fractures in the stampede, and Jennifer Jones, who Baron said suffered neurological damage.

A Wal-Mart spokeswoman declined Friday to discuss the incident but Wal-Mart officials have maintained in the past that it is closely working with law enforcement and government officials to put security measures in place.

Lockley said she arrived at the store at 1 a.m. with her husband, Shawn, and two other family members. She said the crowd swelled to more than 2,000 when the store opened at 5 a.m.

She said she tried to pick up an older lady who fell and she ended up falling to her knees.

She said she could see Damour trying to push people back.

"I was screaming that I was pregnant, I am sure he heard that. . . . He was trying to block the people from pushing me down to the ground and trampling me," said Lockley, a nursing student at LaGuardia Community College in Long Island City.

"Mr. Damour was to the right of me, he was on his knees I could look at him eye to eye and he was trying to push them back and the crowd pushed him down and he fell on top of me."

Eventually on a second try, her husband was able to pull her out and free her.

She was taken to the hospital and treated for injuries where doctors examined the baby who appeared to be OK. Lockley said she suffers from back and neck pain, eye problems and also has insomnia.

Representatives from the Wal-Mart store did send her some baby items about two weeks later, along with a card that read: "May angels carry your little one through life upon their wings."

Staff writers Sophia Chang and Ann Givens contributed to this story.

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Wal-Mart Settles Disability Lawsuit

By Suzanne Robitaille,
Suit101
January 23rd, 2009                     [back to top] 

The world's largest retailer was charged with violating Title III of the Americans with Disabilities Act (ADA) and has promised to improve access for persons with disabilities at its stores nationwide. The agreement resolves an investigation that was initiated after the U.S. Department of Justice received several complaints alleging that Wal-Mart had refused to make reasonable modifications to its rules, policies, practices, and procedures for customers with disabilities. Allegations of ADA Violations

In particular, several complainants alleged that Wal-Mart denied equal access to its stores for people with disabilities who use service animals; at least five complainants alleged a failure to provide disability-related assistance, two complainants alleged that Wal-Mart denied equal access by failing to make reasonable modifications in order to accept payment by people with disabilities at different stores; and one complainant alleged that a Wal-Mart auto service department denied him equal access to its services because he was deaf and did not have a cellular telephone. New Policies to Be Adopted

The settlement agreement covers all facilities located in the United States where Wal-Mart sells any good or service to members of the public, including all Wal-Mart stores, Supercenters, Sam's Clubs, and Neighborhood Markets. The agreement, which will be effective for three years, requires Wal-Mart to take several steps to improve access for customers with disabilities, including:

- an undertaking by Wal-Mart not to discriminate in violation of Title III of the ADA and to provide reasonable modifications to individuals with disabilities as required by Title III of the ADA, such as disability-related assistance such as helping customers in locating, lifting, and carrying items;

- the adoption and implementation of an ADA-compliant policy of welcoming persons with disabilities who use service animals into Wal-Mart stores with little or no questioning and without repeated challenges by Wal-Mart employees;

- training for all employees on Wal-Mart's obligations under Title III of the ADA to make reasonable modifications for individuals with disabilities and Wal-Mart's new ADA-compliant service animal policy;

- additional training for store management and People Greeters, since employees in these positions have additional responsibilities under Wal-Mart's new service animal policy;

- the posting of Wal-Mart's new service animal policy on its website and in employee areas at its stores;

- the establishment of a grievance procedure in which Wal-Mart will receive complaints alleging violations of Title III of the ADA at a toll-free hotline, investigate such complaints, and take appropriate corrective actions to resolve any noncompliance with Title III of the ADA, including relief to complainants where appropriate. Wal-Mart Will Start Awareness Campaign

Under the settlement agreement, Wal-Mart will also pay $150,000 into a fund to compensate certain individuals with disabilities who filed administrative complaints with the Department alleging Wal-Mart's refusal to make reaonable modifications, including the denial of equal access to persons with disabilities who use service animals. Wal-Mart will also pay an additional $100,000 into a fund that will be used by the Civil Rights Division to finance a public service announcement campaign to increase public awareness of the access rights of persons with disabilities who use service animals.

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Pregnant Wal-Mart Stampede Victim Remembers Horror

By Jennifer McLogan,
WCBSTV
January 23rd, 2009                          [back to top] 

A post-Thanksgiving stampede claimed the life of a Wal-Mart employee assigned to open the door on "Black Friday." Now, another stampede victim, a pregnant woman, is speaking out for the first time and expressing her thanks to the security guard who gave his life to save hers.

Leana Lockley calls it a miracle she did not lose her baby in the "Black Friday" stampede.

"There were so many people on top of me it just went silent," Lockley said. "I started hearing my teeth grinding in my mouth and my body being crushed. I really thought I lost my baby."

Lockley, her husband and young son, were in line at 5 a.m. at the Green Acres Mall in Valley Stream when Wal-Mart opened its doors for the post-Thanksgiving Day sale blitz.

"Everyone started to push," Lockley said. "There was glass on the side of doors that started cracking and the hinges broke off. People were pushing. I was literally being carried into the store."

As Lockley became separated from her family she started screaming she was pregnant. One employee she now recognizes as victim Jdimytai Damour was crushed trying to rescue her.

"My back was to the crowd. His chest was facing the crowd. He had his hands up. Unfortunately, the crowd overpowered him. He fell back on me. That's when I fell to the ground. My whole body was flat, my face to the ground. It was dark," she said.

A grateful and emotional Lockley said Damour lost his life saving hers. Photos were taken by Hicksville attorney David Sloan just after she was released from the hospital. They are suing Wal-Mart.

"I just thought I was going to die," Lockley said.

Lockley is due to give birth to a baby girl on April 7. She said she wants to return to Wal-Mart to thank employees, but she doubts she will ever shop there again.

Lockley and her attorney say Wal-Mart has contacted them and is already sending baby diapers, baby food and clothing.

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Wal-Mart settles lawsuit in Cecil man's death

The Associated Press
January 23rd, 2009

An attorney representing the family of a Cecil County man says Wal-Mart has settled a lawsuit filed after the man received the wrong prescriptions from a Wal-Mart pharmacist and subsequently died.

Attorney Harry Barnes told the Cecil Whig it is "a favorable settlement," but says the details were sealed by a federal judge in Baltimore.

George Smith, 66, of North East died in March 2007. He became ill eight days after receiving prescriptions intended for someone else and died at Union Hospital in Elkton. Smith's two adult children sued Wal-Mart last year for $3 million, citing their severe emotional suffering.

Wal-Mart Completes Takeover of Chilean Grocer D&S

By James Attwood ,
Bloomberg
January 23rd, 2009                        [back to top] 

Wal-Mart Stores Inc. acquired a controlling interest in Distribucion y Servicio D&S SA, Chile’s largest grocer, completing its biggest acquisition in Latin America.

D&S shareholders submitted acceptances representing 58 percent of the Chilean company by the Jan. 22 deadline, Bentonville, Arkansas-based Wal-Mart said today in a statement. The world’s biggest retailer offered 40.8 cents per common share Dec. 20, valuing Santiago-based D&S at about $2.66 billion, a premium of 37 percent over the average close for the preceding 30 days.

Wal-Mart, which acquired D&S’s more than 180 stores, 10 shopping centers and 85 financial-services offices, is expanding into emerging markets faster than in the U.S. The deal shows the financial strength of Wal-Mart, with $5.92 billion in cash on Sept. 30, as overseas chief Mike Duke prepares to take charge as chief executive officer on Feb. 1.

“We see an opportunity to grow in Chile as part of our strategy of being a significant retailer in all major markets of the Americas,” Wal-Mart Executive Vice President Craig Herkert said today in a telephone interview from Miami.

Wal-Mart fell 52 cents to $48.35 at 4:15 p.m. in New York Stock Exchange composite trading. The shares advanced 18 percent last year, better than any other stock in the 30-company Dow Jones Industrial Average.

Ibanez Family

Felipe Ibanez Scott and Nicolas Ibanez Scott, sons of D&S founder Manuel Ibanez Ojeda, will retain 40 percent of the grocer’s shares, with the remaining 1.7 percent held by other investors, Wal-Mart said.

Sales by Wal-Mart’s U.S. stores open for at least a year rose 1.7 percent in December, outpacing competitors. Target Corp.’s same-store sales fell 4.1 percent in December, and Costco Wholesale Corp.’s slipped 2 percent.

Wal-Mart runs 3,355 stores in 13 markets outside the U.S. The D&S purchase is twice the size of its 1997 acquisition of Mexico’s Cifra SA for $1.2 billion. International sales accounted for 24 percent of Wal-Mart’s revenue of $374.5 billion in the 12 months through January 2008. A Mexican joint venture in 1991 was its first expansion outside the U.S.

The retailer is grabbing market share in Chile, South America’s fifth-largest economy, which continues to grow even in the face of a global recession. President Michelle Bachelet may tap the $22 billion saved during the four-year boom in copper, the nation’s largest export, to maintain economic expansion.

‘Growth Opportunities’

“If Wal-Mart set its sights on Chile and was willing to invest at high price-to-earnings ratios, it’s because it sees growth opportunities,” said Hugo Aravena, who helps manage $660 million at Scotia AGF in Santiago and runs Chile’s best- performing equity fund of the past year.

Wal-Mart may help D&S boost earnings at its Lider supermarkets, creating a “tough competitor” for rival Cencosud SA, Credit Suisse Group analysts wrote in a Dec. 23 note.

The acquisition has raised some hackles in Chile, where unions representing D&S employees said Dec. 30 that they’ll take action if Wal-Mart fails to respect labor conditions.

“If they try to impose policies they have in other countries, we have to apply a boycott to this company,” Cristian Cuevas, a negotiator for Chile’s central trade union organization, said in an interview last month.

Wal-Mart is in a legal dispute with a Canadian union for closing a store after workers there organized. The retailer won approval this month of a $54.3 million settlement of a suit brought by Minnesota employees who claimed the company didn’t pay them for all hours worked.

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Canadian court to rule by summer in Wal-Mart case

Associated Press,
01.22.09                                  [back to top] 

The Supreme Court of Canada is expected to rule by the summer on a union challenge against Wal-Mart Stores Inc. and its 2005 closing of a Quebec store seven months after workers voted to become the first Wal-Mart in North America to unionize.

Justices questioned attorneys for both sides during oral arguments Wednesday in Ottawa, quizzing them on laws ensuring business prerogative while protecting against worker reprisal.

The world's largest retailer, based in Bentonville, Ark., closed its Jonquiere store in north-central Quebec in April 2005, citing a loss in profitability. The closing came just before an arbitrator was to impose a collective agreement for some 190 recently unionized employees.

Justice Marie Deschamps asked whether the court must find that Wal-Mart (nyse: WMT - news - people )'s main reason for closing the store was the union or whether it was enough that unionization merely "tainted" the decision, the Arkansas Democrat-Gazette reported Thursday.

Union attorneys and lawyers for the Canadian Civil Liberties Association and the Workers Federation of Quebec said Wal-Mart must prove it had a "good and sufficient" reason for shuttering its Jonquiere store, other than its recent unionization.

Bernard Philion, an attorney for the Quebec United Food and Commercial Workers Union, argued that Wal-Mart violated the federal Charter of Rights and Freedoms, which guarantees freedom of association.

"It's difficult to conceive of a worst violation of these provisions than to close a business - a closure designed to cover up an anti-union animus," Philion said.

Wal-Mart attorney Roy Heenan of Montreal and attorneys for the Canadian Chamber of Commerce and other pro-business groups said the union must prove Wal-Mart was specifically discriminating against employees. Heenan noted that several nonunionized Wal-Mart managers also lost their jobs with the store closing.

The legitimate reason for the employees losing their jobs was that "the company closed its doors. We didn't have work for you," he said.

Chief Justice Beverley McLachlin noted that Quebec labor law would not force Wal-Mart to reopen the store and give union employees their jobs back. Rather, the Supreme Court could remand the case to Quebec's labor court, which could order Wal-Mart to pay penalties and damages to employees for their lost wages. A court ruling is expected in five to six months.

In October, Wal-Mart closed an auto shop at its Gatineau, Quebec, store two months after an arbitrator imposed a contract for unionized workers there. Last month, the Saskatchewan Labor Relations Board granted union certification to workers at a Wal-Mart in Weyburn, and the board is considering the same for workers at two other Wal-Marts. In southern Quebec, Wal-Mart workers at Hull, St. Hyacinthe and Gatineau also have gained union certification but do not yet have a contract.

Wal-Mart employs 77,500 people in Canada. Among its North American operations, only bakery and restaurant employees in Mexico are represented by a union. Unions operate in Wal-Mart stores in Brazil, China, Japan and the United Kingdom.

Copyright 2008 Associated Press. All rights reserved

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Wal-Mart Asks Canada’s High Court to Dismiss Suit Over Closing

By Joe Schneider ,
Bloomberg
January 21st, 2009                           [back to top] 

Wal-Mart Stores Inc., the world’s biggest retailer, urged Canada’s highest court to reject a lawsuit that seeks to restrict businesses from closing when employees join unions.

The court’s intervention would undermine Quebec’s Labor Relations Act, Roy Heenan, a lawyer for Wal-Mart, told the nine judges of the Supreme Court of Canada at a hearing today in Ottawa. Unionized employees at a Wal-Mart store in Quebec sued after the company shut the site.

“Don’t constitutionalize labor relations,” Heenan said. “If one wants to amend the Act, then the Quebec legislature should do that.”

Employees at the store in Jonquiere, Quebec, about 470 kilometers (290 miles) north of Montreal, were organized in 2004 by the United Food and Commercial Workers, becoming Wal-Mart’s first workers in North America to form a union. Several employees alleged that their firings violated freedom of association rights guaranteed by Canada’s constitution.

A ruling in the union’s favor would bolster its efforts to organize about 100,000 Wal-Mart workers at more than 300 stores in Canada. The Alliance of Manufacturers and Exporters, Canada’s biggest industry association, the Coalition of British Columbia Businesses and the Canadian Chamber of Commerce have sided with Bentonville, Arkansas-based Wal-Mart, arguing that businesses ought to retain the freedom to make operating decisions.

Quebec’s provincial labor commission dismissed the workers’ complaint that they were fired for union activities, saying Wal- Mart showed good and sufficient cause for the decision to close the store. The commission’s ruling was upheld by a Quebec Superior Court judge and the provincial court of appeal.

“There is no right to close a business in Canada,” said Robert Laurin, a lawyer for the Federation des travailleurs du Quebec, the province’s biggest labor union. “A business that sets up in Canada has to abide by the laws of Canada.”

The court reserved its decision.

The case is Gaetan Plourde c. Compagnie Wal-Mart du Canada Inc., 32342, Supreme Court of Canada (Ottawa).

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Wal-Mart Stores shares decline on downgrade

Associated Press,
01.21.09                         [back to top] 

Shares of Wal-Mart Stores Inc. fell on Wednesday, after an analyst said the company's momentum is slowing and downgraded his rating of the world's largest retailer's stock.

Shares fell $1.55, or 3.1 percent, to $49.01 during afternoon trading. The stock has traded between $4.01 and $8.39 during the past 52 weeks.

As consumer spending has dropped sharply, Wal-Mart Stores Inc. (nyse: WMT - news - people ) has fared better than other retailers by focusing on low prices and offering necessities such as food. However, recent results have shown that even Wal-Mart is taking a hit.

It posted a smaller December sales gain than Wall Street expected and cut its earnings outlook for the fourth quarter this month.

Credit Suisse (nyse: CS - news - people ) analyst Michael Exstein said in a note to investors that the December results show momentum slowing for Wal-Mart.

"The incremental benefit it realized from consumer trade-down in 2008 might not repeat itself in 2009," Exstein said. "Target (nyse: TGT - news - people ) is focusing on reducing prices to gain market share, which we believe presents an added competitive threat to Wal-Mart."

Bentonville, Ark.-based Wal-Mart's slowing store-footage growth and aging stores may also challenge sales-growth expectations, Exstein predicted.

He lowered his rating to "neutral" from "outperform" and cut his target price to $53 from $60.

Copyright 2008 Associated Press. All rights reserved

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For 2nd straight day, a Wis. Wal-Mart is evacuated

Associated Press
01.16.09                         [back to top] 

A southeastern Wisconsin Wal-Mart has been evacuated because of a strange odor, a day after a chemical released in a nearby Wal-Mart sickened nearly 50 people.

West Bend Fire Capt. Jon Coutts says investigators have not determined the cause of the odor at the local Wal-Mart (nyse: WMT - news - people ) early Friday.

Police in nearby Germantown say they'll review surveillance video for clues as to who released a chemical at a Wal-Mart there on Thursday that sickened at least 47 people.

That store was evacuated after customers began feeling ill.

Germantown authorities say 47 people were treated at hospitals for respiratory and other health problems.

Authorities have not said what chemical was released.

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Wal-Mart Canada Unveils Environmental Demonstration Store

By Andy Georgiades,
Dow Jones Newswire
January 15th, 2009                     [back to top]

At Wal-Mart Canada Corp.'s newest store, almost nothing is left to waste.

The Canadian division of Wal-Mart Stores Inc. (WMT) is billing its new supercenter in Burlington, Ont. as an "environmental demonstration store," the second in a line of marquee projects from the retailing giant after the September launch of its new zero-waste head-office outside Toronto.

The highlight of the Burlington project is its use of a geothermal technology that the company is calling a "first" for any large-scale Canadian retail operation. The system uses 15 kilometers of piping under the parking lot to exchange heat from the earth into the store in winter. In summer, heat from the store is returned underground.

A machine called a "spider plough" was used by Canadian engineering firm Stantec Inc. (STN) to lay the massive amount of plastic piping for the system, helping to reduce costs.

In an interview immediately following a store tour, David Cheesewright, Wal- Mart Canada's president and chief executive, said some of the store's environmental features will work and some won't, but he likes the odds of using the geothermal system elsewhere. He said the costs have already come down significantly - to about C$500,000 from C$1 million - and are expected to be cut in half again.

"It's quite easy to see how it could be a viable business proposition for us," Cheesewright said.

He said sustainability is a business philosophy for the entire company and remains a priority despite the economic downturn.

In the U.S., Wal-Mart has similar "living laboratories" at stores in Texas and Colorado. As with those stores, Wal-Mart Canada will use the Burlington location to test features before deciding what makes sense to incorporate into the rest of its 300-plus store network.

The Burlington store, which at 129,000 square feet is significantly smaller than the average Canadian supercenter, boasts several energy-saving features. They range from having one entrance instead of two and using LED lights inside and out, to the installation of a complex "daylight harvesting" system that controls light levels in the store based on skylight sensors.

Wal-Mart estimates the store will use 60% less energy than its typical stores and will be able to divert 85% of its waste from landfill.

Because the store's sustainability features aren't easily apparent to customers, the company has a large sign near the entrance listing its environmental attributes.

Below the sign is a recycling depot that will accept, in addition to bottles and newspapers, such items as CFL bulbs and plastic bags.

Other interesting features include the refrigeration system, which uses non- traditional refrigerants that are 90% more environmentally friendly. Waste heat from refrigeration is also reclaimed and used to heat the rest of the store. Refrigerator and freezer cases can be covered at night to lock in the cool temperatures and are equipped with motion-activated LED lights to save energy during the day.

The store also has in-floor radiant heating and cooling, and sources 100% of power from Bullfrog Power, a provider of "green" electricity in Ontario and Alberta.

Starting later this year, all new Wal-Mart Canada stores will be 30% more efficient, and over the next four years, retrofits will make existing stores 20% more efficient.

Customers will notice the green products, including 800 organic food items, green cleaning products under its new private-label brands, CFL bulbs for all parts of the home, and leaner product packaging.

Separately, on the subject of sales, Cheesewright said December was a bit slower than expected, but the company's market share is gaining, which he said is a more important measure in this economic climate. He also said there has been a good "bounce-back" in sales so far in January.

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Mystery chemical causes evacuation of Wal-Mart

By Don Behm ,
Milwaukee Journal Sentinal
January 15th, 2009                               [back to top]

Police are investigating the possible intentional release of a chemical inside the Wal-Mart Supercenter on Appleton Ave. that forced a midday evacuation and sent nearly 50 people to area hospitals with complaints of breathing problems and other health effects.

Germantown Deputy Fire Chief John Delain said 25 people were taken by ambulance to area hospitals and 22 others went on their own to Community Memorial Hospital in Menomonee Falls for treatment.

All patients were released or expected to be released, hospital spokesmen said.

Germantown Village Police Chief Peter Hoell said that a substance believed to be responsible for the evacuation was found on the floor of the store, and that investigators believed they had found the possible source.

Hoell would not identify the substance, where it was found in the store or the source.

This is a criminal investigation, Hoell said Thursday. He declined to comment on whether any Wal-Mart employees were suspected of a crime.

Emergency responders had not determined how to clean up the substance, Hoell said. Authorities decided not to ventilate the store immediately, however.

The substance was contained inside the store, and there was no danger to anyone outdoors, Hoell said.

Hazardous materials units from Washington County and a few other area communities were dispatched to the store. Germantown firefighters and police were assisted by ambulances from fire departments throughout the region, the Washington County Sheriff's Department and the State Patrol.

Hoell said he did not know if the store would reopen today.

An estimated 200 customers and 20 employees were in the store at the time of the incident, he said.

Wal-Mart spokeswoman Kelly Cheeseman, in Bentonville, Ark., issued a statement Thursday that said:

"Some kind of irritant was in the air inside our store which caused discomfort for some people inside the store. The safety of our customers and associates is our top priority. We are working with the police and fire department to investigate. The store will remain closed until officials give us the clearance to reopen."

A customer who was inside the store when several people started becoming ill around 12:40 p.m. Thursday said an unknown chemical had affected her nose and throat.

Debbie Block said she didn't see or smell anything while she was shopping at the store in the candle section on her lunch break. But her nose and throat became "extremely irritated."

"I thought I was coming down with something," she said.

She headed to the checkout lanes and by the time she got there, an announcement was made over the store's public address system, saying, "All Wal-Mart customers at this time please evacuate the building," she said.

"I asked what was going on and the cashier said there was smoke in the building. But I didn't see or smell anything," she said.

Outside, at least 100 shoppers were lined up when the first ambulance arrived, she said.

Darren Drewek, 21, said he and his girlfriend began coughing as soon as they entered the store.

"Right as you walked in there, you got a tickle in your throat," Drewek said. "It felt like you had a hairball in your throat, and you just had to cough."

Drewek said he was buying a bottle of Listerine when customers were ordered to evacuate. He and his girlfriend drove out of the parking lot as ambulances began to arrive, he said.

Another Wal-Mart customer, Michael Holzem, was in the checkout line, buying one item for one of his children and one for himself, when the announcement to evacuate the Germantown store came over the public address system, he said.

"I paid for the first item and then there was the announcement and they said, just leave it there, you have to leave," said Holzem, who lives in Clyman and works in Menomonee Falls.

Holzem said he didn't smell or see anything and didn't suffer any irritation or coughing.

Holzem was outside the store for about half an hour when a hazardous materials team arrived, he said.

He said a store associate told him there had been a chemical spill in the store, but the employee didn't elaborate.

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Defective car seat re-sold at Wal-Mart

By Annie Cutler ,
ABC 4
January 13th, 2009                          [back to top]

RIVERTON, Utah (ABC 4 news) - It's a product meant to protect your baby, but a Riverton family is upset. The car seat they bought from Wal-Mart had been returned and labeled defective. So they called ABC 4 to take action and get results so this doesn't happen to any other Utah families.

The McKeeths need a car seat for Audrey, their eight month old daughter. They bought a Safety 1st model they liked from Wal-Mart Monday. They were shocked when they opened it up and found a return receipt stapled to the back of a registration form.

Description: Car seat Reason: latch comes open Exchange.

But somehow the defective car seat made it back on Wal-Mart’s shelf. Kristine McKeeth says, “It's scary to think I could put my child in this, get in an accident, and then have the seat come out of the car.”

We tried to strap the seat into the back of the family car. Having dealt with car seats before, Dave McKeeth realizes something's not right. He demonstrates by shaking the seat back and forth. The family says they want to make sure a mistake like this doesn't happen to anyone else. Dave McKeeth says, “We're the lucky ones that got a receipt on it that said it's defective. There could be others out there or it could be a one time case, we don't know.”

We asked Wal-Mart about their procedures and if this is an ongoing mistake. A representative said, "It is our protocol to send returned items to the manufacturer. After talking with the store, it appears this is an isolated incident."

Wal-Mart didn't go into any detail about how they would ensure that this doesn't happen again... or whether any employees were disciplined. Wal-Mart will work with the McKeeths when they return this car seat for another.

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BRIEF-Stork Craft recalls 535,000 cribs due to faulty mattress brackets

Thomson Financial News
January 13th, 2009                            [back to top]

WASHINGTON, Jan 13 (Reuters) - The U.S. Consumer Product Safety Commission:

* Says Canadian-based Stork Craft Manufacturing Inc recalls about 535,000 cribs due to risk of faulty mattress support brackets.

* Says recalled cribs were sold at major retailers including JCPenney, Wal-Mart (nyse: WMT - news - people ) and Kmart from May 2000 to January 2009.

* Says agency is aware of 10 incidents in which one or more mattress support brackets broke.

* Says posted details of recalled cribs at www.cpsc.gov

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Families File Suit After Wal-Mart Construction

WOWK TV
January 13th, 2009                        [back to top]

More than half a dozen Putnam County families filed a lawsuit, after construction of the a new Wal-Mart allegedly causes damage to their property. Seven families who live in Hurricane, near the new Wal-Mart, filed suit earlier this month. According to published reports, the families allege blasting by the construction company, caused damage to their property and diminished the value of their property. The families are asking for compensation for the damage to their property and court costs.

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Wal-Mart Moves Closer to Russia

The Moscow Times
12 January 2009                     [back to top]

Wal-Mart, the world's largest retailer, has registered a legal entity in Russia and joined a local retailers' organization, the latest in a series of moves indicating its interest in expanding into the country.

The company registered a subsidiary under the name WM Eastern Europe Holdings and joined the Russian Association of Retail Trade Companies, or AKORT, which includes the 28 largest commercial organizations in the country.

"Wal-Mart is working on the Russian market," Ilya Belonovsky, the executive director of the 28-member industry group said Dec. 29. He declined to elaborate.

Members of the association include French retail giants Carrefour and Auchan, Germany's Metro, as well as local firms X5 Retail Group and Magnit.

In April, Wal-Mart appointed an executive to head its efforts to explore business opportunities in Russia and neighboring markets.

In June, the company said it was "exploring opportunities in Russia," weeks after it acknowledged taking "active steps" to research Russia and nearby countries in Eastern Europe.

A source with an investment bank advising Wal-Mart said Dec. 29 that the U.S. company was in acquisition talks with Russian chains that may need a cash injection.

"It's a very opportune moment for Wal-Mart now that assets are getting cheaper," he said.

The Russian retail sector has been badly hit by a credit squeeze triggered by the global economic crisis, which analysts say could speed up consolidation within the fragmented sector.

A source with a headhunting agency familiar with Wal-Mart's expansion plans in Russia said the U.S. giant had been hiring administrative staff. "There are already about 30 managers working in their team," the source said.

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Wal-Mart CEO sees no quick rebound for US economy

Reuters
January 12th, 2009          [back to top] 

The chief executive of Wal-Mart Stores Inc (WMT.N) said on Monday he expects the U.S. economy to remain extraordinarily challenging in the first half of the year and that he was not expecting a quick turnaround.

Lee Scott made the comments at the National Retail Federation's annual conference being held in New York. He described it as his last public speech as head of the world's largest retailer before retiring on Feb. 1.

Scott said the U.S. government's efforts to stimulate the economy should have "some impact," but added: "I don't see anything that tells me it's going to turn around quickly."

"The second half of the year, you would hope, would be better," he said. "We all hope by next Christmas it certainly isn't any worse."

Wal-Mart, the discount giant, has been gaining market share in the last year as consumers seek out its low prices on items such as food and medicine to stretch limited budgets.

But a year-long recession, mounting job losses and tighter access to credit combined to produce the worst holiday sales season in nearly four decades, according to the International Council of Shopping Centers.

Wal-Mart was not immune to the harsh climate and last week posted lower-than-expected December sales and cut its fourth-quarter profit forecast. [ID:nN08350904]

FUNDAMENTAL SHIFT IN SPENDING

Scott said this downturn may fundamentally change people's spending habits.

"I'm not necessarily convinced that just when all this liquidity and things hit, if you're going to have the same immediate desire to go back to consumption and debt," he said, referring to a potential U.S. government stimulus plan.

"There are a lot of young people who have learned what it's like when you are living on the edge and the bad times come."

Consumers may not be as inclined to splurge or accumulate debt after having lived through such a difficult economic period, he said.

That could spell more bad news for retailers who are already slowing growth plans, closing underperforming locations and laying off workers as consumer spending diminishes.

NRF President and CEO Tracy Mullin said more than a dozen retailers, including Circuit City (CCTYQ.PK) and Sharper Image, filed for Chapter 11 bankruptcy protection in 2008.

Adding to the gloomy outlook for the start of 2009, on Monday customer traffic tracking firm ShopperTrak forecast that total foot traffic to retail stores would fall 16.4 percent in the first quarter and U.S. retail sales could fall 4 percent in that same period.

"Although consumers will continue redeeming gift cards and taking advantage of some post-holiday sales throughout January, slow first-quarter shopping levels will have the industry scrambling," Bill Martin, co-founder of ShopperTrak, said in a statement.

TACKLING TOUGH ISSUES

Scott said business leaders should not use the downturn as an excuse to avoid tackling tough issues, like the soaring cost of health care or pushing for alternative sources of energy.

"There is no conflict between delivering value to shareholders and helping solve bigger societal problems," he said.

Making reference to a "problem-solving vacuum" in Washington, he pushed for government and business leaders to work together to solve these problems.

The speech echoed comments Scott made a year ago, when he said Wal-Mart would use its heft as the world's largest retailer to push for changes in health care, energy consumption and sourcing.

Under Scott, the retailer has vowed to one day create zero waste and use only renewable energy. In October, Wal-Mart said it would begin tightening controls on its Chinese suppliers by requiring them to meet tougher quality standards or face losing the retailer's business.

Wal-Mart shares rose 25 cents to $51.85, outperforming a 2 percent decline for the Standard & Poor's Retail Index .RLX.

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Area construction firm wins suit against Wal-Mart

By Matt Burns,
Columbus Business First
January 9th, 2009                    [back to top]

A Central Ohio construction company could be in line for a more than $2 million payout from Wal-Mart Stores Inc. after winning a jury trial in a breach of contract lawsuit against the retail giant.

Thomas & Marker Construction, which has offices in Bellefontaine and Marysville, was awarded $1.55 million Dec. 23 under a unanimous jury verdict in Dayton federal court. The company had sued Bentonville, Ark.-based Wal-Mart (NYSE:WMT), alleging the retailer breached a $9.6 million contract by not paying for extra costs for removing bedrock during construction of a Springfield store.

Thomas & Marker accused Wal-Mart of failing to indicate the hard-to-remove bedrock in a geotechnical report it provided before construction. Wal-Mart countersued, alleging a subcontractor didn’t properly install a water line during construction, but the jury also ruled in the firm’s favor on that count.

Randy Marker, the firm’s president, said in a statement that the company is “extremely pleased.”

Wal-Mart spokeswoman Michelle Bradford said the retailer is disappointed in the verdict and is reviewing its options. She declined to speculate on a possible appeal.

John Bodin, an associate with Bellefontaine-based Thompson Dunlap and Heydinger Ltd. who represented the firm, said the proposed $1.55 million judgment was submitted to the court Thursday and should be signed soon. A final judgment including interest and attorney fees likely will top $2 million when handed down within the next two months, he said.

The December verdict ended more than two years of litigation over the June 2005 contract. The store opened on schedule in spring 2006, the firm said in a release.

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Retailers report dismal December sales

By ANNE D'INNOCENZIO,
01.08.09                                          [back to top]

Retailers reported dismal sales figures for December on Thursday as even Wal-Mart Stores Inc., one of the bright spots in the industry, finally buckled under the pressures of the deteriorating economy.

As merchants reported their sales figures, confirming fears that the holiday season was the weakest in four decades, the malaise cut through practically all areas from kitchen gadget stores to jewelry purveyors and teen apparel retailers.

The deep discounts that began well before the official start of the holiday season spurred a number of merchants to cut their earnings outlooks on Thursday, fueling more concerns about the health of the industry.

Among the many retailers that reported steep sales declines were Sears Holdings Corp., which operates Kmart and Sears stores, luxury retailer Saks Inc., Gap Inc., Abercrombie & Fitch Co. . But the biggest surprise came from Wal-Mart, the world's largest retailer, which posted a smaller sales gain than what Wall Street expected and cut its fourth-quarter earnings outlook.

"This suggests that the lower income group is feeling the pinch more than we thought and this is clearly reflected in the lower-than-expected numbers at Wal-Mart," said Ken Perkins, president of research company RetailMetrics LLC. "I think it says the economy is in more dire straits than we thought."

Wal-Mart, blaming the weak economy and severe winter conditions, said that same-store sales, or sales at stores opened at least a year, rose 1.2 percent. Excluding the impact of declining gasoline prices at the pump, the gain was 1.7 percent. Analysts surveyed by Thomson Reuters had expected a 2.8 percent increase, excluding fuel.

"The current economy remains challenging for all businesses, and retailers have already seen customers pull back on discretionary spending," Wal-Mart's Chief Financial Officer Tom Schoewe said in a statement. "Consumers are very focused on value and necessities."

Wal-Mart noted that health and wellness items were the categories that primarily fueled sales. Electronics sales were solid, while the apparel and jewelry business was weak.

Given the disappointing sales and higher-than-anticipated expenses, Wal-Mart said it now expects to earn 91 cents to 94 cents per share in the fourth quarter from continuing operations. That's down from its previous projected range of $1.03 per share to $1.07 per share. Analysts surveyed by Thomson Reuters expected $1.06 per share.

Meanwhile, Costco Wholesale Corp. reported a 4 percent decline in same-store sales, but excluding the impact of lower gas prices and currency fluctuations, it actually posted a 4 percent gain. Lower gas prices are good for consumers, but reduce the sales volume for retailers like Costco.

Among department stores, Sears Holdings said its December same-store sales dropped 7.3 percent, weighed down by a 12.8 percent drop at domestic Sears stores. The company, whose brands include Kenmore and Craftsman, said Kmart same-store sales fell 1.1 percent.

Macy's Inc. reported that same-store sales fell 4 percent in December, less than the 5.3 percent decline that analysts had expected. For the combined November-December period, same-store sales were down 7.5 percent. But the department store chain cut its fourth-quarter and full-year earnings outlook due to heavy markdowns and announced plans to close 11 underperforming stores. The chain operates more than 840 Macy's stores.

Luxury retailer Saks Inc., which operates Saks Fifth Avenue, fared far worse, as affluent shoppers were spooked by the financial meltdown that resulted in massive layoffs on Wall Street and shrinking investment portfolios. Same-store sales dropped 19.8 percent for the month, worse than the 10 percent drop that Wall Street expected.

Limited Brands Inc. posted a 10 percent drop in same-store sales, larger than the 7.8 percent decline analysts predicted. The company also lowered its fourth-quarter earnings outlook.

Gap Inc. suffered a 14 percent drop in same-store sales, worse than the 9.3 percent decline that analysts had expected. It also cut its earnings outlook.

"Customers waited until late in the month to shop and we faced a highly competitive promotional environment," said Gap's Chief Financial Officer Sabrina Simmons.

Teen apparel retailers also suffered through a miserable holiday season. Wet Seal Inc. reported a 12.5 percent decline, larger than the 11.9 percent analysts expected, as its Arden B chain dragged down results. Abercrombie & Fitch Co. reported a 24 percent drop, in line with the 23.5 percent drop analysts had forecast.

Kitchen gadget chain Williams-Sonoma Inc., which didn't break out December figures, said its same-store sales dropped more than 24 percent for the eight-week period ended Dec. 28 and warned its fourth-quarter profit will likely come in at the low end of expectations.

Copyright 2008 Associated Press. All rights reserved.

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Wal-Mart Registers Disappointment

Carl Gutierrez,
Market Scan
01.08.09                               [back to top]

Discounter sees little joy from holiday shopping season amid general retail gloom. Wal-Mart, the last bastion of U.S. retail strength, has cracked. The chain cut its earnings outlook on Thursday after posting weaker-than-expected December sales.

Same-store sales at Wal-Mart (nyse: WMT - news - people ) rose 1.7% in December, with a 1.9% rise at Wal-Mart U.S. and a 0.1% rise at warehouse operator Sam's Club. The numbers were weak next to what was expected. Wall Street's analysts had, on average, had expected a rise of 2.8%, while Wal-Mart itself had expected a gain of 1.0% to 3.0%.

Total sales for the five weeks ended Jan. 1 edged down 0.1%, to $46.51 billion, from $46.57 billion last year.

Investors didn’t take Thursday's news well, knocking Wal-Mart's shares down 8.1%, or $4.51, to $31.03, in afternoon trading, and taking the rest of the stock market with it. Ironically, the rest of the retail sector fared rather well. Although same-store sales in December fell througout the industry, many companies did better than Wall Street had expected.

As measured by the SPDR S&P Retail (nyse: XRT - news - people ) exchange-traded fund, the sector gained 0.8%, or 17 cents, to $21.37, with Target (nyse: TGT - news - people ) rising 1.3%, Cosco (nyse: COST - news - people ) increasing 1.6% and Kohl's (nyse: KSS - news - people ) jumping 3.6%.

Macy's (nyse: M - news - people ) fell somewhere in between. The New York-based department-store chain saw a drop in December same-store sales, but it beat Wall Street's expectations. (See "Macy's Tightens Its Belt, Sears Soars.") Nonetheless, it announced it was shutting 11 stores and cutting its fourth-quarter outlook.

"No matter how much retailers discount merchandise, the bottom line is consumers are just spending less," said Mark DeGennaro, managing director at Gruppo, Levy, a mergers-and-acquisitions firm.

DeGennaro added that retailers will be under stress for the foreseeable future, and clearly through 2009. "They're getting squeezed from many different angles," DeGennaro said. "Vendors, consumers, discounting merchandise is heavily impacting margins, and banks, which themselves have shaky balance sheets.

Wal-Mart revised its outlook for earnings from continuing operations in the fourth quarter to be 91 cents to 94 cents per share, down from the previous forecast for $1.03 to $1.07 per share. Analysts were predicting earnings of $1.06 per share.

The company had developed a reputation of doing better than its competitors, thanks to its focus on low prices to attract financially squeezed shoppers around the world.

Part of December's problem could be Wal-Mart's own holiday business strategy. Anticipating weak sales, Wal-Mart started its Christmas season early and cut prices on several toys in 3,500 American stores as a way to woo shoppers during the important year-end period.(See "Wal-Mart Toys With Xmas Strategy.")

While Thursday's figures were discouraging, Wal-Mart's recession-friendly strategy has been paying off for its investors. Over the past 12 months, Wal-Mart's shares have risen 21.5%, while chief competitor Target has fallen 23.0% and J.C. Penny (nyse: JCP - news - people ) has tumbled 42.9%. The S&P 500 index has fallen 35.8% over the same period.

But even as Wal-Mart fares better than its peers, it hasn't been impervious to the recessionary economy, and Thursday's numbers weren't the first piece of bad news. (See "Wal-Mart Tightens Its Belt.") In November, Wal-Mart reported that its third-quarter earnings had jumped 6.9%, but it had to trim its outlook on fluctuating exchange rates and a weak economic environment.

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Wal-Mart Rolls Back Earnings Outlook

Carl Gutierrez
and Miriam Marcus,
Market Scan
01.08.09                                         [back to top]

Retailer not looking as recession-proof as thought following disappointing December same-store sales.

Traditionally an outperformer in down markets, discount retailer Wal-Mart is showing signs of weakness. The chain cut its earnings outlook on Thursday after posting weaker than expected December sales.

Same-store sales at Wal-Mart (nyse: WMT - news - people ) rose 1.7% in December, with a 1.9% rise at Wal-Mart U.S. and a 0.1% rise at warehouse operator Sam's Club. The numbers were weak next to what was expected, surprising investors who have seen the retailer outperform rivals as the store of choice in a downturn. Wall Street's analysts had, on average, expected a rise of 2.8%, while Wal-Mart itself had expected a gain of 1.0% to 3.0%.

Wal-Mart benefited last year as shoppers focused on necessities, but analysts say its disappointing December performance may signal that shoppers are pulling back even more.

"The blanket that has covered the North American consumer that has kept them from spending is heavier than expected," said Dean Hillier, partner in the retail practice of consulting firm A.T. Kearney.

Investors didn’t take Thursday's news well, knocking Wal-Mart's shares down 7.5%, or $4.16, to close at $51.38, and taking the rest of the stock market with it. Ironically, the rest of the retail sector fared rather well. Although same-store sales in December fell throughout the industry, many companies did better than Wall Street had expected.

Macy's (nyse: M - news - people ) fell somewhere in between. The New York-based department-store chain saw a drop in December same-store sales, but it beat Wall Street's expectations. (See "Macy's Tightens Its Belt, Sears Soars.") Nonetheless, it announced it was shutting 11 stores and cutting its fourth-quarter outlook. Macy’s fell 3.4%, or 38 cents, to close at $10.93.

"No matter how much retailers discount merchandise, the bottom line is consumers are just spending less," said Mark DeGennaro, managing director at Gruppo, Levy, a mergers-and-acquisitions firm.

While some retailers beat sales expectations, many of those did so only by slashing prices, which will hammer fourth-quarter margins, said Morningstar analyst Joe Beaulieu. “The sales numbers are not a lot worse than expected, but I think what's really going to take a toll on these companies is when you report earnings and you see what kind of discounts you had to have to pull the numbers.”

DeGennaro added that retailers will be under stress for the foreseeable future, and clearly through 2009. "They're getting squeezed from many different angles," DeGennaro said. "Vendors, consumers, discounting merchandise is heavily impacting margins, and banks, which themselves have shaky balance sheets."

Drugstore chain Walgreen (nyse: WAG - news - people ) meanwhile announced 1,000 job cuts, just days after reporting a 4.9% increase in same-store sales. Shares of the drugstore chain closed down 0.7%, or 19 cents, to $26.84.

Wal-Mart revised its outlook for fourth-quarter earnings from continuing operations to a range of 91 cents to 94 cents per share, down from the previous forecast for $1.03 to $1.07 per share. Analysts were predicting earnings of $1.06 per share.

The company had developed a reputation of doing better than its competitors, thanks to its focus on low prices to attract financially squeezed shoppers around the world.

Part of December's problem could be Wal-Mart's own holiday business strategy. Anticipating weak sales, Wal-Mart started its Christmas season early and cut prices on several toys in 3,500 American stores as a way to woo shoppers during the important year-end period. (See "Wal-Mart Toys With Xmas Strategy.")

While Thursday's figures were discouraging, Wal-Mart's recession-friendly strategy has been paying off for its investors. Wal-Mart's shares have risen 10.4% over the past year, while chief competitor Target has fallen 23.4% and J.C. Penny (nyse: JCP - news - people ) has tumbled 40.0%. The S&P 500 index has fallen 35.8% over the same period.

But even as Wal-Mart fares better than its peers, it hasn't been impervious to the recessionary economy, and Thursday's numbers weren't the first piece of bad news. (See "Wal-Mart Tightens Its Belt.") In November, Wal-Mart reported that its third-quarter earnings had jumped 6.9%, but it had to trim its outlook on fluctuating exchange rates and a weak economic environment.

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Wal-Mart's Not Smiling

Carl Gutierrez,
Market Scan
01.08.09                             [back to top]

Its Christmas sales fell short of expectations, a discouraging sign from retail's stand-out stock. Wal-Mart Stores, Inc. 01/08/2009 2:07PM ET$51.25-$4.29-7.72%

Same-store sales at Wal-Mart (nyse: WMT - news - people ) rose 1.7% in December, with a 1.9% rise at Wal-Mart U.S. and a 0.1% rise at warehouse operator Sam's Club. The numbers were weak next to what was expected. Wall Street's analysts had, on average, had expected a rise of 2.8%, while Wal-Mart itself had expected a gain of 1.0% to 3.0%.

Total sales for the five weeks ended Jan. 1 edged down 0.1% to $46.51 billion from $46.57 billion last year.

The market didn’t take Thursday's news well, pulling Wal-Mart's shares down $4.58, or 8.3% to $50.96 at the open.

Wal-Mart also said it now expected earnings from continuing operations in the fourth quarter to be 91 cents to 94 cents per share, down from the previous forecast for $1.03 to $1.07 per share. Analysts were predicting earnings of $1.06 per share.

The company had developed a reputation of doing better than its competitors, thanks to its focus on low prices to attract financially-squeezed shoppers around the world.

Part of December's problem could be Wal-Mart's own holiday business strategy. Anticipating weak holiday sales, Wal-Mart started its Christmas season early and cut prices on several toys in 3,500 American stores as a way to woo shoppers during the important year-end period.(See "Wal-Mart Toys With Xmas Strategy.")

While Thursday's figures were discouraging, Wal-Mart's recession-friendly strategy has been paying off for its investors. Over the past 12 months, Wal-Mart's shares have risen 21.5%, while chief competitor Target (nyse: TGT - news - people ) has fallen 23.0% and J.C. Penny (nyse: JCP - news - people ) has tumbled 42.9%. The S&P 500 index has fallen 35.8% over the same period.

But even as Wal-Mart fares better than its peers, it hasn't been impervious to the recessionary economy, and Thursday's numbers weren't the first piece of bad news. (See "Wal-Mart Tightens Its Belt.") In November, Wal-Mart reported that its third-quarter earnings had jumped 6.9%, but it had to trim its outlook on fluctuating exchange rates and a weak economic environment.

One month earlier, the company announced that Mike Duke, who had been heading up the mega-retailer's international operations as vice chairman, would be the firm's new chief executive officer, effective Feb. 1. (See "Wal-Mart Shuffles At the Top.")

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Sam's Club's head to be Wal-Mart International CEO

By Jessica Wohl,
Reuters
January 7th, 2009                      [back to top]

Wal-Mart Stores Inc (WMT.N) said on Wednesday that Doug McMillon, the current head of its Sam's Club division, will become president and CEO of Wal-Mart International next month, when the current man in that role takes over as the company's president and CEO.

McMillon, 42, will report to Mike Duke, who had held the top international job before being named as the successor to Lee Scott as Wal-Mart's president and CEO.

Both Duke and McMillon take on their new roles on Feb. 1. Wal-Mart said it would name a new president and CEO of Sam's Club at a later date.

McMillon started working at Wal-Mart as an hourly associate, unloading trucks at a distribution center while attending college.

Wal-Mart International, with more than 3,300 stores, is the retailer's second-largest operating segment, accounting for about 25 percent of the company's revenue.

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Tumbling toy leads to Wal-Mart lawsuit

By Paul Shockley,
Grand Junction Free Press
January 7th, 2009                             [back to top]

Alleged injuries suffered from a tumbling toy at a local Wal-Mart store has led to a lawsuit against the retail giant.

Jeri Prescott, of Orchard Mesa, is seeking unspecified monetary damages and claims she was struck in the head by a 40-pound boxed toy four-wheeler while Christmas shopping at the Wal-Mart Supercenter, 2881 North Ave., on Dec. 9, 2006.

Through her local attorney, Prescott claims the store was legally negligent because an employee pushed the box off a shelf, which landed “directly” on her head and shoulder area, according to the complaint.

The extent of the injuries is not spelled out in the lawsuit, which was filed on Nov. 18. It’s also unclear why Prescott waited nearly two years to bring the lawsuit.

Prescott did not return numerous calls seeking comment.

Michelle Bradford, spokeswoman with Wal-Mart’s corporate offices in Arkansas, said customer safety is a “top priority.”

“That’s not really information I can provide,” Bradford said, when asked how frequently the company faces lawsuits related to customer injuries.

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Wal-Mart, Netflix conspired to create monopoly, suit alleges

Bloomberg
January 7th, 2009                         [back to top]

Wal-Mart Stores Inc. and Netflix Inc. were accused of conspiring to create a monopoly for online video rentals in a consumer lawsuit alleging that the collusion drove up prices.

The two companies agreed in 2005 that Wal-Mart, the world's largest retailer, would close its online rental business and refer customers to Netflix, which would promote Wal-Mart's DVD movie sales, according to the lawsuit filed in federal court in San Francisco.

The accord eliminated competition, enabled Netflix to maintain monopoly power and led Blockbuster Inc. to raise subscription rental prices by $3 to meet Netflix's higher prices, the Jan. 2 complaint alleges.

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Wal-Mart settles drug records accusation

By CHUCK BARTELS ,
Associated Press
1.07.09                                            [back to top]

Wal-Mart Stores Inc. has agreed to a $637,000 fine to settle allegations that it violated drug record keeping regulations at its pharmacies in south Texas.

Federal prosecutors said Wednesday that Wal-Mart (nyse: WMT - news - people ) paid the fine on Dec. 29 and that the settlement was made final on Tuesday.

Acting U.S. Attorney Tim Johnson says the case began with five Wal-Mart and Sam's Club pharmacies that allegedly didn't have records the government requires to help prevent diversion of controlled substances. Johnson said the problem with the records violated the Comprehensive Drug Abuse Prevention and Control Act, under which the complaint was brought. More Wal-Mart pharmacies in the region were then audited, he said.

"The accountability audits did not match the drugs on hand, revealing major overages and shortages in the accountability of controlled substances, and there were missing invoices for controlled substances all in violation of the CSA," Johnson's office said in a news release.

"Because of the pharmacies' lack of proper record keeping, a variety of Schedule II, III, IV and V controlled substances were lost or stolen and possibly diverted," the release said.

Real-Time Quotes 01/08/2009 2:37PM ET WMT$51.17-7.87%Get Quote BATS Real-Time Market Data by XigniteWal-Mart spokeswoman Daphne Moore said the settlement was limited to discrepancies between records and inventory involving a small number of pharmacies in Texas. The company has more than 4,000 pharmacies in its U.S. stores.

Moore would not directly address questions about whether any drugs were missing.

"We provide our managers with training regarding controlled substances. Of course, we'll continue to review those practices," Moore said.

 She said Wal-Mart is eager to comply with the law.

"We take record keeping seriously and we cooperated fully with the U.S. Attorney's Office and the (Drug Enforcement Administration) in the investigation. We continuously review our processes at our pharmacies to ensure they are accurate and in full compliance with the law," Moore said.

Copyright 2008 Associated Press. All rights reserved

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Wal-Mart names new head of international division

Associated Press,
01.07.09                                [back to top]

Wal-Mart Stores Inc. says it has promoted the president and CEO of its Sam's Club warehouse division to fill the same roles at its international unit.

Doug McMillon fills the spot in the company's second-largest operating segment left by Mike Duke, who was tapped in late November to succeed Lee Scott as Wal-Mart (nyse: WMT - news - people )'s chief executive.

Analysts said when Duke was named CEO was a sign that the company sees its future growth overseas.

The international business is the fastest-growing division at the world's largest retailer.

Duke and McMillon will assume their new duties Feb. 1.

Copyright 2008 Associated Press. All rights reserved

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Wal-Mart Mexico Drops as UBS Advises Selling Shares

By William Freebairn ,
Bloomberg
January 6th, 2009                       [back to top]

Jan. 6 (Bloomberg) -- Wal-Mart de Mexico SAB, the country’s largest retailer, fell the most in almost two months after UBS AG advised selling shares and analysts said it may say sales at stores open at least a year declined in December.

Walmex, as the company is known, lost 4.9 percent to 36.09 pesos in Mexico City trading in the biggest drop since Nov. 12.

The retailer has been forced to use “heavy promotions” to keep sales from falling more, said UBS analyst Tomas Lajous, who cut the shares to “sell” from “neutral.” The Mexico City- based company may say sales at stores open more than a year fell as much as 2 percent, analysts at Citigroup Inc. and Credit Suisse Group AG wrote in reports today. Walmex will report December sales tomorrow, according to its Web site.

The sales report and fourth-quarter results will likely “confirm the inevitable: sales growth is slowing fast and is taking a toll on margins,” Lajous wrote.

Walmex shares are “richly valued” and the current share price is “untenable,” Lajous wrote.

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Wal-Mart pulls slippers after animal-rights group complains

By Bradley Bouzane,
Canwest News Service
January 5th, 2009                           [back to top]

The Animal Defence League of Canada is celebrating a "major victory" after Wal-Mart Canada agreed to pull a type of Chinese-made slippers that contained real rabbit fur from its shelves.

The retail giant pulled the Tender Tootsies slippers, which advertised "all man-made materials," on Monday morning after a member of Vancouver's Animal Defence League discovered the products were incorrectly labelled and contained real fur. Wal-Mart has a no-fur policy at all of its stores.

"They have been pulled from the shelves, and what we were told is that if there's any still on the shelves, their UPC code won't go through at the till while they're in the process of taking them out of their stores," said Marley Daviduk, a spokeswoman for the Vancouver branch of the national organization.

"Wal-Mart was extremely compliant and right away said that they do not sell fur, so right away I knew it was another case of Chinese suppliers being dishonest with companies and giving them real fur when they think it's fake."

Daviduk found the slippers while shopping last week and the Ottawa and Vancouver branches of the Animal Defence League immediately contacted both Wal-Mart Canada and the product's London, Ont.-based importer.

"I knew right away it was real rabbit fur, but it said on the tag that there were no man-made materials," she said.

"In Canada, there are no laws regarding labelling, so items don't have to say which animal it is, let alone say that it's real. But you can't mislabel them, legally."

Calls to Wal-Mart Canada and Tender Tootsies Ltd. were not immediately returned Monday afternoon.

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Wal-Mart continues to violate Ct tax laws despite promise to obey

By George Gombossy,
The Hartford Courant
January 5th, 2009                            [back to top]

Sue Drobinski of New Britain says that despite Wal-Mart entering into an agreement to follow state laws on taxes involving even exchanges, its employees in New Britain are not following the law.

I sent her email to state Consumer Protection Commissioner Jerry Farrell Jr. this morning, who has responded that his legal department will contact Wal-Mart to bring up this and other similar complaints.

This is her email:

"I just wanted you to know that Wal-Mart still has not received the message that sales tax cannot be charged on an even exchange.

I recently purchased a product that, once I opened it, I realized that someone had removed the original "branded" item and replaced it with the Wal-Mart generic item.

Wal-Mart did let me do an even exchange for the item, but said I needed to pay the $.57 sales tax.

I mentioned that this was against the law, but the clerk assured me that was ONLY if I had a receipt.

I gently pressed this response, but she again stated that I needed the receipt to not have to pay the tax. It wasn't worth an argument for 57 cents, but I felt that Wal-Mart still doesn't get the message that they are doing something illegal.

The Wal-Mart where this occurred was located on Farmington Avenue in New Britain.

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Man claims work boots cause painful burns

By Cynthia Cisneros,
ABC 13
January 4th, 2009                              [back to top]

The man from Magnolia says he picked up some work boots at a Wal-Mart store, and he says the shoes have given him some major problems. He wants to know why.

It's the last thing Jay Kowolski thought would ever happen. He bought a new pair of work boots and almost immediately his feet began to itch, then burn. It wasn't until he took off the boots that he realized the extent of the damage to his feet in just one day. He took pictures to show the severity of the reaction.

"It's a real lightweight suede boot, sued leather work boot," said Kowolski.

Kowolski bought at the boots at a Wal-Mart in Tomball. They are the Brahma brand; a popular, reasonably priced boot. Kowolski wears boots at his job and on a rainy day, the new boots got wet, and that's when he says his feet began to have a burning sensation.

"When I got home and pulled my boots off, my toes were all covered in red, just literally started eating into the skin," he said.

The next day Kowolski could barely walk. His wife took him to a doctor.

"'They said it was an allergic reaction to something in the boot, from the water going through the boots creating some sort of chemical reaction and had burned his feet," said Jay's wife, Kandie Kowolski.

Kowolski spent the next three weeks off his feet and on antibiotics. His skin eventually grew back, however he says the tips of his toes remain slightly red.

Kowolski's wife, meanwhile, began researching the boots and found similar experiences had happened to at least two other people. Kandie Kowolski sent a certified letter to Wal-Mart's president and CEO in Arkansas. She says she's upset the company has not responded.

"Actually, I am because they seem to, you know, they portray that they care so much about the American people but you get a letter like this and you don't even respond?" she said.

She is worried the problem could happen again.

"I would like for them to take these boots off the shelf," said Kandie. "Don't put the rest of these American people at risk because of something like that."

Because of the holiday weekend, a Wal-Mart spokesperson was unable to speak specifically about the boots, but offers this general statement.

"The safety of our customers and associates is a top priority. Wal-Mart is committed to the highest standard of quality and safety with the merchandize that is available in its stores. We take every claim seriously and investigate each and every one."

As for the Kowolskis, they tell Eyewitness News they have stopped buying any type of shoes at Wal-Mart until their complaint is resolved.

In 2007, about 10 customers claimed they received burns and blisters from flip-flop sandals they bought at Wal-Marts across the country. It's a different brand from the boots. After learning about the problem, Wal-Mart pulled the sandals off store shelves.

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The next bubble to burst?

Jeff Milchen
Sunday, January 4, 2009                       [back to top]

When economic growth stalls, some businesses fail to survive, so our recession inevitably is accompanied by such failures. When it comes to retail, however, the trickle of store closings last year may soon become a torrent now that the temporary stimulus of the holidays is past. As with the collapse of housing prices, the economic downturn is not the root problem, but simply exposed a long-building bubble.

During the past two decades, retail square footage has increased at triple the rate of population growth and consumer spending combined. As Stacy Mitchell documents in her book, "Big Box Swindle," retail capacity more than doubled between 1990 and 2005, driven overwhelmingly by chain store proliferation.

Yet, even as Internet sales increased, the retail building frenzy has continued - about 140 million square feet of new development will be completed this year. As a result, we're awash in shopping space, with nearly double the area per capita of any other large nation (and almost 10 times that of many European nations).

Now add in the rapid decline in credit spending. Barring an unprecedented economic turnaround, our retail glut will yield a sizable wave of store closures once the holiday season passes.

Already last year, seemingly solid chains like Gap, Circuit City and Foot Locker shuttered hundreds of stores, with more to come. And the problem extends beyond retail; Starbucks, Blockbuster and Bennigan's did the same.

By the end of the third quarter of 2008, chain store closings already exceeded 2007's total, reports the International Council of Shopping Centers. The council also predicts that nearly 150,000 other, mainly smaller, independent retail establishments will close this year. Although these independent retailers represent a greater overall loss to our economy and communities, a diverse local economy can absorb the loss of several small businesses. But communities dependent on a few large corporations are far more vulnerable.

California will endure many large store failures, including Linens 'n Things and Circuit City (each closing 24 stores in-state). Mervyns is closing its remaining 150 stores, including more than 100 in California. Mervyns, based in Hayward, will generate about 10 million square feet of vacant space.

Nationwide, already strapped municipal budgets will be stung by declining revenue from sales tax and commercial property tax, and by increased unemployment. Due to heavy dependence on sales tax, however, California and its municipalities will be hit especially hard.

It's too late for this bubble to deflate without damage, but states and communities should act promptly to reverse some of the conditions that encouraged the bubble and to build a more sustainable economy.

Economic misconceptions, as well as speculation, played a huge role in creating our retail bubble. For example, big-box chains inevitably promise to create hundreds of jobs and bring millions of dollars in sales tax revenue when lobbying to build a new store. The claims are not false, but grossly misleading.

Without population growth, spending on typical big-box goods like hardware, basic clothing or housewares is a relatively fixed pie. Though we might shift our shopping, we don't increase our consumption of socks or toasters much just because a new venue is selling them. "New" sales tax proceeds and jobs simply displace jobs and revenue at existing area businesses.

The community may see an immediate spike in revenue from the new store, but once newly generated public costs for traffic signals, sewer, water, and fire protection are calculated, cities often experience a net loss. This is one reason why, despite the new receipts accompanying retail sprawl, taxes often rise fastest in rapidly growing communities.

A community loses big, however, when a chain displaces sales at an independent business (or displaces entire businesses). Why? A new chain store typically is a clone of many other units, eliminating the need for local planning, and using a minimum of local goods and services. Profit is exported to corporate headquarters and almost all local jobs are low-skill positions.

In contrast, independent business owners typically spend much of their profit locally, give back more to the community, and create jobs for local accountants, Webmasters, ad agencies and many other higher-skilled people. In addition to offering greater career potential, these jobs are a training ground for future generations of entrepreneurs.

A 2007 study in San Francisco by Civic Economics is one of many to quantify the premium that cities derive from local ownership. It found that dollars spent at independent businesses yielded nearly three times more local economic benefit than those spent at chain competitors, and created about 80 percent more jobs.

The recession has a plus side: It has sharply increased awareness of hazards that accompany dependence on giant corporations. As a result, interest in "Buy Local" campaigns, green business programs and other strategies to build wealth from within communities is exploding.

This should not be mistaken for mere backlash against corporate subsidies and exploitation. Citizens are becoming more sophisticated in their understanding of economics and recognizing that directing growth and protecting community character are not obstacles to economic vitality - rather they are effective means to sustain it. Now we need our elected officials to follow.

Durable local economy Here are some steps to curb retail blight and build a more durable local economy:

-- Encourage community-serving retail and redevelopment of vacant shopping centers by restricting retail development on the outskirts.

-- Ensure that new development is designed to last and is adaptable by mandating high-quality materials and multi-story, mixed-use buildings. This also will use land far more efficiently than single-story box stores with their moats of parking.

-- Limit the amount of land zoned for retail (other than neighborhood-serving business) and the size of big-box stores, as San Francisco and at least seven other California cities have done. Small and midsize spaces are easier to reuse and create a more diverse local economy.

-- If larger stores are allowed, require bonds sufficient to cover the cost of demolishing or rehabilitating a vacant store, as Oakdale does.

-- Regularly poll local residents and business owners to identify needs and wants and seek local entrepreneurs to meet them. This includes manufacturing, service, retail and more.

-- Develop mentor programs and business incubation space to encourage and strengthen entrepreneurs.

-- Require impact fees for development sufficient to cover new and recurring costs such as road building, traffic control, water and sewer lines, additional police and fire personnel, etc.

-- The state should enforce its sales-tax rules that require online businesses with any tangible connection to California to collect sales taxes, just as brick-and-mortar stores and businesses do. This will enable storefront businesses to compete without a huge handicap.

-- Eliminate the destructive competition for retail by negotiating shared sales-tax revenue on a population basis.

-- Organize a "Buy Local" campaign or independent business alliance to build support for independent business as San Francisco, Menlo Park, Oakland and Petaluma have done.

Groups that support sustainable businesses sfloma.org San Francisco Locally Owned Merchants Alliance advances a citywide "buy local" campaign.

Calhcn.org California Healthy Communities Network (Napa) helps communities enact smart growth policies and prevent unwanted big-box development.

nciba.com Northern California Independent Booksellers Association (San Francisco), a regional trade group, supports independent retail book selling.

livingeconomies.org Business Alliance for Local Living Economies (San Francisco) promotes sustainable business practices and green building internationally.

ibuypetaluma.org Petaluma Independent Business Alliance promotes the cultural and economic benefits of doing business locally.

hometownpeninsula.org Hometown Peninsula Independent Business Alliance (Menlo Park) engages in education and advocacy to support independent businesses in San Mateo County.

sustainablenovato.org Sustainable Novato encourages local business ownership among its broader sustainability goals.

shopoakland.com Shop Oakland/Support Oakland Grown Businesses & Artists campaigns promote Oakland's entrepreneurs.

More to come: Berkeley and Richmond, among other cities, are developing buy-local campaigns.

Jeff Milchen co-founded the American Independent Business Alliance (amiba.net), a nonprofit organization helping more than 50 community organizations sustain locally owned business and vital local economies.

© 2009 Hearst Communications Inc.

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Suit against Suisun City leaves Walmart in legal limbo

By Ian Thompson
Daily Republic
January 02, 2009                                   [back to top]

SUISUN CITY - Walmart is awaiting the final ruling on a lawsuit against its proposed supercenter in eastern Suisun City before deciding what to do next.

'The project is still in litigation and we do not have a timetable at this point for moving forward,' said Kevin Loscotoff, a Walmart spokesman.

The Suisun Alliance, which opposed the supercenter, sued Suisun City over the project's environmental impact report, contending it inadequately addressed the project's impact on the community and environment.

The alliance was handed a reverse in November when a Solano County Superior Court judge issued a tentative ruling in Suisun City's favor, upholding the EIR. A final ruling is expected in mid-February.

Save Our Suisun, another group opposing the supercenter, continues to keep a close eye on the project and has been critical of the project's potential impact on wetlands and watercourses in and around the site.

The proposed supercenter at Walters Road and Highway 12 still needs the blessing of the California Regional Water Quality Control Board.

The board turned down the retail giant's application without prejudice on Nov. 21, stating it was still incomplete by the time it reached as one-year approval deadline.

As of Friday, Walmart has not reapplied to the board for permits, according to Bruce Wolfe, executive officer for the San Francisco Bay Regional Water Board.

Having to submit the application again means more work for Walmart, which will have to re-evaluate the design of the supercenter to minimize its impact on wetlands and devise a comprehensive storm water runoff plan.

Walmart wants to build a supercenter, gas station, car wash and restaurant on the 21-acre site.

With the exception of the board, all other agencies have stated publicly that they have no problem with the project. Suisun City unanimously certified the EIR.

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Waiting game for Walmart continues in Fairfield

By Ben Antonius
Daily Republic
January 02, 2009                             [back to top]

The old Mission Village shopping center is still standing where a planned Wal-Mart is set to be built.

FAIRFIELD - You were supposed to be shopping in a new Walmart by now.

The project has fallen behind schedule since the retail giant first got the go-ahead to build a supercenter on North Texas Street. Walmart is likely now looking at opening in 2010 at the earliest, although that would probably still be sooner than its planned Suisun City store could open.

'It took them a long time . . . to put together the plans and get them submitted to us,' Fairfield City Manager Sean Quinn said.

When the company's plans were first approved in December 2006, the vision was that the store 'in all likelihood will open in 2008.'

With 2008 come and gone, not only are Walmart's doors not open, but the vacant Mission Village shopping center is still standing in its place.

However, Quinn said the company has not expressed any reservations about entering the Fairfield market, which has been hammered particularly hard by the foreclosure crisis and the economic recession. The latest plans have demolition starting at the shopping center in early 2009, Quinn said.

Representatives for Walmart could not be reached over the holiday.

Walmart in August submitted building plans for the 185,193-square-foot store. They were reviewed by the city, and Walmart sent in revised plans in October.

The December 2006 decision gave the world's largest retailer permission to go ahead with plans to knock down the abandoned Mission Village center and build a supercenter, complete with a garden area and a full-service grocery.

'It will be nice for revitalizing that area and taking down those buildings,' Quinn said.

But those plans idled after a lawsuit raising environmental concerns about the store was filed in January 2007.

A Solano County Superior Court judge in September 2007 ruled in favor of the city, which was being challenged on the validity of the environmental studies it had conducted on the impacts of the store. Opponents had 60 days to appeal but did not do so.

The project also ran afoul of a law that had required all of the store's 1,000-plus parking spaces to be within 300 feet of the building. City officials said the rule was arbitrary and impractical, and voted in April to drop the law.

Walmart is also facing a legal challenge in Suisun City, where it is planning to build a similar supercenter store at the intersection of Highway 12 and Walters Road.

Reach Ben Antonius at 427-6977 or bantonius@dailyrepublic.net.

Next steps for Walmart

Aside from a length of chain-link fence being erected, nothing has changed at the North Texas Street site since the Walmart Supercenter was approved in 2006. Here's what to look for in 2009 and beyond:

Demolition could start on the old Mission Village buildings as early as January or February. The process could be complicated slightly by the need to preserve the Liberty Christian Center, which is staying put.

Construction could start as early as April, if the demolition schedule holds. It would likely take at least a year.

Opening day could come as soon as spring 2010 under this scenario, city officials say.

Closure of the existing Walmart on Chadbourne Road would be timed to coincide precisely with the first day of the new supercenter.

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Historians battle Wal-Mart over key Civil War site

By STEVE SZKOTAK,
Associated Press
01.02.09                                     [back to top]

Wal-Mart wants to build a Supercenter within a cannonshot of where Robert E. Lee and Ulysses S. Grant first fought, a proposal that has preservationists rallying to protect the key Civil War site.

A who's who of historians including filmmaker Ken Burns and Pulitzer Prize winner David McCullough sent a letter last month to H. Lee Scott, president and CEO of Wal-Mart Stores Inc. (nyse: WMT - news - people ), urging the company to build somewhere farther from the Wilderness Battlefield.

"The Wilderness is an indelible part of our history, its very ground hallowed by the American blood spilled there, and it cannot be moved," said the letter from 253 scholars and others.

Wal-Mart and its supporters point out that the 138,000-square-foot store would be right behind a bank and a small strip mall, a full mile from entrance to the site of the 1864 clash that left thousands dead and hastened the war's end.

Local leaders also want the $500,000 in tax revenue they estimate the big box store will generate for rural Orange County, a gradually growing area about 60 miles southwest of Washington.

"In these economic times, the fact that Wal-Mart wants to come into the county is an economic plus," said R. Mark Johnson, a tire shop owner and chairman of the county's board of supervisors. "This is hardly pristine wilderness we're talking about."

Grant's Union troops were headed to Richmond on May 4, 1864, when they confronted Lee's Confederate Army of Northern Virginia. The Battle of the Wilderness involved more than 100,000 Union troops and 61,000 Confederates. The fighting, according to National Park Service estimates, left more than 4,000 dead and 20,000 wounded.

Some 2,700 acres of the Wilderness Battlefield are protected as part of the Fredericksburg and Spotsylvania National Military Park.

Related Stories Out Of Treasuries And Boldly Into The Fire Bad Cisco News Awful For Economy Manic Depression To Normalization A Glimmer In The Global Gloom? Cold Christmas For China's Manufacturers Related Videos Street Stumbles On Jobs Jobs Sink Street Krugman's $2 Trillion Fix Satyam Rocks Indian Market Apple Revamps iTunes StoriesVideos Preservationists regularly square off against developers in Virginia, where much of the Civil War was fought.

This dispute, however, has stirred an outcry similar to the one in 1994 over The Walt Disney Co. (nyse: DIS - news - people )'s plans to build a $650 million theme park within miles of the Manassas Battlefield. The entertainment giant bowed to public pressure and abandoned the project.

Bentonville, Ark.-based Wal-Mart, which opened nearly 200 stores in the U.S. in 2007, said it studied a lengthy list of sites in Orange County before settling on the spot near the battlefield and its gentle hills dissected by neat footpaths.

"We recognize the significance of the Wilderness Battlefield, but we are not building on the battlefield," said Keith Morris, a spokesman for the world's largest retailer.

Preservationists argue the store site is still significant because it was used as a staging area by Union troops.

"Is it blood-soaked ground? No, but it is a part of the battlefield," said Jim Campi, a spokesman for the Civil War Preservation Trust, which lists the Wilderness Battlefield as endangered.

Supervisors will have the final say, after county planners decide if the retailer should be granted a zoning variance. Hearings likely will be scheduled in February and March.

Supervisor Teri Pace said there are "more appropriate places" in the county for Wal-Mart to build. She envisions an economic development plan that taps the county's history - including President James Madison's restored home, Montpelier - and its agricultural heritage, which now includes several popular wineries.

"If we define ourselves and promote ourselves as something different, with tourism and agriculture, we really have huge opportunities here," Pace said.

Copyright 2008 Associated Press. All rights reserved.

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VIDEOS

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Fighting Wal-Martization 25min. (2005)

A new video by The Labor Video Project 25 min. (2005)

Wal-Mart is now the largest private employer in the United States and has the same impact that General Motors had nearly 50 years ago. This 26-minute video shows why working people and trade unionists are fighting back and what Wal-Mart has in store for the communities it is seeking to build stores in. "Fighting Wal-Martization" is a hard hitting documentary that looks at how the constant price cutting not only drives local small businesses out of the community but how this ends up driving down the living conditions of the very people who shop at Wal-Mart. The video also looks at the healthcare crisis and how Wal-Mart increases its profits by sending it¹s employees to public hospitals to get treatment thereby shifting costs back onto the taxpayer. This video can be used at union meetings, community meetings and on cable TV to get the message out about the Wal-Martization of America and what it means to every working person.

Please mail your check of $20.00 and order form to

Labor Video Project
P. O. Box 720027,
San Francisco, CA 94172

For more info: lvpsf@labornet.org, (415) 282-1908

Wal-Mart: The High Cost of Low Prices (www.walmartmovie.com)

Independent America: The Two Lane Search for Mom & Pop (www.independentamerica.net)

Big Box Mart (www.jibjab.com)

Garth Brooks Parody (www.walmartworkersrights.org)

"Is Wal-Mart Good for America?" Frontline, PBS Video, (www.pbs.org)
 

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BOOKS

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NON-FICTION

The Case Against Wal-Mart By Al Norman Raphel Marketing ruth@raphael.com

Wal-Mart: The Face Of Twenty-First Century Capitalism Edited By Nelson Lichtenstein The New Press www.thenewpress.com

The Great Risk Shift: The Assault on American Jobs, Families, Health Care and Retirement By Jacob S. Hacker Oxford University Press www.oup.com

War On The Middle Class: How the Government, Big Business, and Special Interest Groups Are Waging War on the American Dream and How to Fight Back By Lou Dobbs Viking, a member of Penguin Group www.penguin.com

Momentum: Igniting Social Change in the Connected Age By Allison H. Fine Jossey-Bass www.joseybass.com

Big-Box Swindle: The True Cost of Mega-Retailers and the Fight for America's Independent Businesses, By Stacy Mitchell, www.beacon.org www.newrules.org

Wal-Mart: The Face Of the Twenty-First-Century Capitalism, Edited by Nelson Lichtenstein, Published by The New Press www.thenewpress.com

 The Bully Of Bentonville - How the high cost of Wal-Mart's Everyday Low Prices is Hurting America, By Anthony Bianco, Published by Doubleday
Email: specialmarkets@randomhouse.com

 How Wal-Mart is Destroying America (and the world), By Bill Quinn, Published By Ten Speed Press, Box 7123, Berkeley, CA 94707, www.tenspeed.com (pp. 163)

Slam Dunking Wal-Mart, By Al Norman, Published By Raphel Marketing, 12 S. Virginia Avenue, Atlantic City, New Jersey 08410, www.sprawl-busters.com (pp. 237)

The Great American JobsScam, By Greg LeRoy, Published By Barrett-Koehler Publishers, Inc., 235 Montgomery Street, Suite 650, San Francisco, CA 94104-2916, www.bkconnection.com (pp. 257)

Nickel and Dimed, By Barbara Ehrenreich, Published By Henry Holt and Company, LLC, 115 West 18^th Street, New York, NY 10011, www.henryholt.com (pp.221)

United States of Wal-Mart, By John Dicker, Published By Jeremy P. Tarcher (Penguin Group usa), www.us.penguingroup.com (pp.257)

The Wal-Mart Effect, By Charles Fishman www.penguin.com

Megamall On The Hudson, By David Porter and Chester L. Mirsky www.trafford.com

FICTION

Death By Discount, By Mary Vermillion, Published By Alyson Publications, P.O. Box 4371, Los Angeles, CA 90078-4371, www.maryvermillion.com (pp. 275)