Archive for the ‘Walmart’ Category

Tainted donkey meat … say, what?

February 17, 2016

Believe it or not, this topic came up in a chat with students … so, I decided to reprise it. 

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Business Week ran an article titled “Keeping the Mystery Out of China’s Meat”

Can’t explain why I decided to read it.

 

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But, I did … and here’s what caught my eye.

(more…)

Walmart: The economic cost of social wage hikes …

October 16, 2015

Earlier this year, CNN reported (and editorialized):

Retail workers have just scored an unprecedented win against a retail giant.

Walmart, the nation’s largest private employer, announced that it will raise the wages of approximately 500,000 of its employees by lifting its base wage to $10 by 2016.

To be sure, Walmart’s announcement is an impressive development in the fight for better wages.

It’s a step in the right direction, but not enough.

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Let’s fast-forward to this week …

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Tainted donkey meat … say, what?

April 1, 2014

Recent issue of Business Week ran an article titled “Keeping the Mystery Out of China’s Meat”

Can’t explain why I decided to read it.

 

image

But, I did … and here’s what caught my eye.

(more…)

Amex offers co-branded Wal-mart prepaid card … say, what?

October 17, 2012

Punch line: Wal-Mart and American Express take aim at the traditional credit card model to offer an alternative to lower-income consumers.

The new card will expand AmEx’s customer base while offering Wal-Mart another foray into financial services.

Blubird today, platinum tomorrow … I guess.

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Excerpted from Reuters’, “Wal-Mart, Amex team up on card for lower-income shoppers”

Walmart_bluebird-card

Wal-Mart Stores Inc and American Express Co. have teamed up to provide financial services to customers who often do not have traditional bank accounts by offering a prepaid debit card called Bluebird.

The move will give American Express … a 4,000-store gateway to tens of millions of so-called “underbanked” households and … Walmart will get to extend its mantra of “every day low prices” to yet another sphere and come closer to achieving its years-long goal of offering banking services.

The Bluebird will allow for deposits by smartphone and mobile bill paying, with no minimum balance or monthly, annual or overdraft fees, the companies said on Monday.

“Bluebird is our solution to help consumers who currently may be poorly served by traditional banking products,” said Dan Schulman of American Express. “In an era where it is increasingly ‘expensive to be poor,’ we have worked with Wal-Mart to create a financial services product that rights many of the wrongs that plague the market today.”

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Wal-Mart to Amazon: BRING IT

October 16, 2012

Punch line: Wal-Mart is launching a new same-day delivery service to compete against Amazon.com this holiday season.  Wal-Mart boasts a huge network of stores to ship product from, but Amazon has effective operational efficiencies and loyal customers.  This season, who will win the holiday war?

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Excerpted from WSJ’s “Wal-Mart Delivery Service Says to Amazon: “Bring It.”

In its latest bid to take on Internet powerhouse Amazon.com this holiday season, Wal-Mart is promising same-day delivery in some cities for orders placed online.  The retailer began testing the new service in select cities last week and says it will cost $10 regardless of the size of the order.

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Called Wal-Mart To Go, the products will be shipped from the company’s stores, not from a warehouse or distribution center.   Over the past several years, Wal-Mart has launched several attacks on its online rival, including a price war over best-selling books three years ago.

This time, Wal-Mart is betting that its network of thousands of stores … can help it compete head to head with Amazon, which has increasingly stressed fast, free or low-cost deliveries.

But shipping from stores, rather than from warehouses as Amazon does, is expensive, analysts said.  It can be three to four times the cost for the retailer to pick items and pack them from a store versus having a really efficient, automated process back in a distribution center.

Wal-Mart has been ramping up its e-commerce business, which employs 1,000 workers in San Bruno, Calif.  The retail giant has acquired nearly a dozen start-ups to help broaden its online presence and developed @Walmart Labs, its Silicon Valley tech shop that has revamped the walmart.com website and mobile applications to make them more competitive with Amazon and other online retailers.

Wal-Mart also has been trying to compete with Amazon’s prices inside its stores. In some, it has quietly begun matching the online retailer’s prices when customers ask, a practice historically done only against local brick-and-mortar competitors.

Wal-Mart also has been trying to use its stores to tap into millions of shoppers who either don’t have credit or debit cards or don’t feel comfortable disclosing their personal financial information online.  In April, the retailer began a program that allows customers to order merchandise online and pay for it at a store with cash.

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Hey, neighbor … our name’s Walmart.

October 3, 2011

Punch line: By 2013, Walmart will launch nationally more Neighborhood Market Stores that are smaller in size and offer groceries.

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Excerpted from brandchannel.com, “Walmart: Your Friendly Neighborhood Grocer (by 2013)

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When you think Walmart, you generally think big and you don’t generally think groceries, but its Neighborhood Market stores may change that.

Chicago opened its third Walmart this week, but this is a Neighborhood Market store … At about 27,000 square feet, the downtown store is a fraction of a regular-sized Walmart, which can be as large as 150,000 square feet.

And while groceries are typically 1/3 of the product sold at a Walmart, it takes up ¾ of the Market …

Walmart has been opening Neighborhood Markets since 1998 and now has 155 nationwide with plans to have 300 of them by 2013

Chicago launched the first Walmart Express in July. “Our approach to the city of Chicago is to be flexible,” Walmart spokesman Steve Restivo. “We want the store size and the merchandise mix to be a reflection of the community it’s in.”

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Wal-mart goes back for the future … more EDLPs

March 29, 2011

TakeAway:  Wal-Mart lost sight of what made it a retail giant: every day low prices.

In an attempt to reverse its US sales slump, the company is abandoning its recent focus on upscale shoppers to instead refocus on low prices.

In a crowded mass retail segment, differentiating with the lowest prices just might get Wal-Mart back on track.

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Excerpted from brandchannel, “Wal-Mart Tries to Find Its Way Back,” by Dale Buss, March 22, 2011

It’s one thing for a brand to recognize the error of its ways and attempt to return to what made people love it in the first place. But it’s quite another thing to complete the journey successfully.

Walmart, America’s largest retailer, is finding out that truth about branding these days. It is mired in its worst U.S. sales slump ever, kept there for now by the chain’s inability to return to its roots as a basic purveyor of value-priced merchandise after an ill-considered move upscale.

[According to] Bill Simon, Wal-Mart corporate’s new U.S.-stores chief … Walmart stores are returning to the Every Day Low Prices formula that traditionally powered its sales growth, and also restoring broader selection.

“I think we tried to stretch the brand a little too far,” Simon said.

In short, Walmart realized that its core customers… liked the feel of stores so full of attractively priced merchandise that it could barely be contained on the shelves. A couple of years ago, under Project Impact, Walmart had stripped selection and focused on a clean-store look in an effort to attract upscale shoppers. But that group proved a fickle lot.

Now, in a new advertising campaign breaking next month, Walmart will highlight its decades-old emphasis on low pricing by poking fun at competitors … who use the sort of “high-low” strategy it just abandoned. …

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Wal-Mart goes right to the source …

November 1, 2010

TakeAway: Wal-Mart has built its reputation on its ability to cut its costs, and then pass the savings on to its customers.

To lower its costs even further, Wal-Mart is now exploring the idea of buying raw materials in conjunction with the manufacturers who sell products in Wal-Mart.

Wal-Mart would presumably know exactly how much the manufacturers are saving, so it’s no surprise they’re staying away.

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Excerpted from Bloomberg Businessweek, “Wal-Mart Wants More Buying Clout,” by Matthew Boyle and Carol Wolf, October 7, 2010

Wal-Mart Stores purchasing chief Hernan Muntaner has a dream: teaming the giant retailer with soda and snack maker PepsiCo to buy potatoes jointly for a lower price than either company can get on its own. That would allow both to earn more money on the chips and spuds they sell in Wal-Mart’s supermarkets. So far, Pepsi isn’t playing along. But with sales slowing in the U.S. and the price of sugar, meat, and wheat on the rise, the world’s largest retailer is jointly purchasing a growing share of raw ingredients with manufacturers of food and household products sold in its stores. …

It’s all about the retailing giant doing what it’s become famous for: squeezing costs out of its supply chain. And although Wal-Mart is already feared by many suppliers for its enormous buying clout, it’s convinced it can cut even better deals by consolidating its purchasing with partners. Currently, only makers of private label goods sold under Wal-Mart’s house brands have joined in its so-called collaborative sourcing program. Manufacturers of branded products have taken a pass because they’re loath to share pricing data and product formulas …

Muntaner says that “in most cases” the branded companies “are more sophisticated than we are” in buying raw materials. ” …

Muntaner’s primary job is to circle the globe helping Wal-Mart’s international divisions … find ways to use the company’s massive buying muscle to lower what it spends on everything from copier paper to store-branded bottled water. Increasingly, that means selling the benefits of sourcing collaboratively. Muntaner says a soda maker … has teamed up with Wal-Mart in Britain to buy sugar. The soda company paid 14 percent less, he says. Wal-Mart’s sugar costs also fell, savings it used to lower the price of bags of its own house brand of sugar. …

This is just the company’s latest attempt at slowing expense growth. Wal-Mart … wants savings of over a billion dollars eventually.

Edit by DMG

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Full Article
http://www.businessweek.com/magazine/content/10_42/b4199023758279.htm

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Never Say Never to Wal-Mart

September 2, 2010

TakeAway:

Seventh Generation specialty products will now be available at Wal-Mart (and its broad, mainstream audience), as Wal-Mart boosts its “green” efforts by winning over a company that said it would never sell there. 

“We now believe that we can have a bigger impact by partnering with Wal-Mart than by shunning it.” 

Seventh Generation lowered prices across the portfolio so that they cost as much as or only slightly more than the leading national brand. 

To justify its decision, Seventh Generation explains that Wal-Mart’s social and environmental targets were specific and its reports seemingly transparent.

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Excerpted from WSJ, “Adversary’s Clean Start with Wal-Mart” by Ellen Byron, July 26, 2010

For years, Seventh Generation Inc. co-founder Jeffrey Hollender liked to say “hell would freeze over” before his company’s environmentally friendly household products would be sold by Wal-Mart Stores . He feels differently now.

Starting next month, Seventh Generation staples, including laundry detergent, dish soap, all-purpose sprays and disinfectant wipes, will be sold in about 1,500 Wal-Mart stores.

Five years ago, the world’s largest retailer began setting goals to reduce its energy consumption, cut waste and introduce more sustainable products.

To be sure, selling green products is also increasingly lucrative.

While many shoppers switched to cheaper labels during the recession, sales of household products billed as environmentally friendly have held up relatively well despite their premium prices. 

  • Sales of green household and laundry cleaning products rose to $557 million last year, having more than tripled since 2005.
  • Green products are still a niche category, however, representing only about 3% of the overall $19.9 billion household cleaners and laundry market.

Seventh Generation’s change of heart toward Wal-Mart came gradually.

Seventh Generation and Wal-Mart are both members of the Sustainability Consortium, a group of manufacturers, retailers, nongovernmental organizations and government officials that is developing tools and strategies to evaluate the environmental and social impacts of products’ lifecycles.

“Wal-Mart can move quicker than probably any government on the planet.”

Edit by AMW

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Full article: http://online.wsj.com/article/SB10001424052748704421304575383271764631764.html?mod=dist_smartbrief

If you can’t trust Walmart, who can you trust?

July 2, 2009

Ken’s Take: Yesterday,  Walmart jumped on the Obamawagon and threw its support behind employer mandated healthcare insurance – the provision that layers additional taxes on any company that doesn’t offer its employees health insurance.

For sure, Walmart isn’t being altruistic.  This is a straightforward strategic-political gambit. 

Walmart already provides health insurance to the majority of its employees – essentially, all full-timers.  They might have to extend coverage to part-timers – or, they might be hoping that part-timers are outboarded from legislation — or, they just hire fewer part-timers (since their advantage over full-timers gets minimized)..

More important, few smaller retailers provide health benefits today.  All of these guys – Walmart’s competitors – will get slammed with higher taxes. In other words, their costs go up, theor margins go down, and Walmart gets a huge competitive advantage.  The small guys won’t be able to compete.

Also, there may be a quid pro quo for Walmart politically. 

Specifically,  if union “card check” gets passed, Walmart will have to be priority one for unionization.  That would be a way bigger problem than employer mandated healthcare insurance. 

My bet: Team Obama prizes the healthcare plan more than card check and cut a deal with Walmart to back off card check. 

Problem for Walmart: administration has a tendency to change rules and break promises.  Could backfire on Walmart.

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Excerpted from WSJ, “ Everyday Low Politics” – Wal-Mart buys protection by selling out its competitors”. July 2, 2009

The employer-mandate endorsement falls into the self-interest department. A boost in the minimum wage helps Wal-Mart because most of its workers already earn well over the wage floor, and it hurts smaller, less-profitable competitors that can’t afford to pay more. On health care, an employer mandate will also reduce the margins of their rivals. This is especially true for businesses of a slightly smaller size that cannot insure on the same scale or currently don’t reach the 55% of the 1.4 million Wal-Mart employees who are insured through the company. (Another 40% or so are covered by spouses or the likes of Medicaid.)

The Wal-Mart-Stern-Podesta troika made sure to specify that “shared responsibility” must be “fair and broad in its coverage,” with an emphasis on the latter. The Mom & Pop stores that liberals accuse Wal-Mart of running out of town may get hit hardest. Democrats say they’ll exempt certain small businesses, size details to be determined. But if the mandate is limited to large employers, it won’t reduce the number of uninsured. According to the Kaiser Family Foundation, 99% of firms with more than 200 workers provide health benefits, only 62% of smaller firms.

Businesses are also largely indifferent whether compensation comes in the form of wages or benefits, so an employer mandate — an indirect tax on employment — may cause wages to rise more slowly. Or it may simply mean fewer jobs.

Full article:
http://online.wsj.com/article/SB124649408574683287.html

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If you can’t trust Walmart, who can you trust?

July 2, 2009

Ken’s Take: Yesterday,  Walmart jumped on the Obamawagon and threw its support behind employer mandated healthcare insurance – the provision that layers additional taxes on any company that doesn’t offer its employees health insurance.

For sure, Walmart isn’t being altruistic.  This is a straightforward strategic-political gambit. 

Walmart already provides health insurance to the majority of its employees – essentially, all full-timers.  They might have to extend coverage to part-timers – or, they might be hoping that part-timers are outboarded from legislation — or, they just hire fewer part-timers (since their advantage over full-timers gets minimized)..

More important, few smaller retailers provide health benefits today.  All of these guys – Walmart’s competitors – will get slammed with higher taxes. In other words, their costs go up, theor margins go down, and Walmart gets a huge competitive advantage.  The small guys won’t be able to compete.

Also, there may be a quid pro quo for Walmart politically. 

Specifically,  if union “card check” gets passed, Walmart will have to be priority one for unionization.  That would be a way bigger problem than employer mandated healthcare insurance. 

My bet: Team Obama prizes the healthcare plan more than card check and cut a deal with Walmart to back off card check. 

Problem for Walmart: administration has a tendency to change rules and break promises.  Could backfire on Walmart.

* * * * *

Excerpted from WSJ, “ Everyday Low Politics” – Wal-Mart buys protection by selling out its competitors”. July 2, 2009

The employer-mandate endorsement falls into the self-interest department. A boost in the minimum wage helps Wal-Mart because most of its workers already earn well over the wage floor, and it hurts smaller, less-profitable competitors that can’t afford to pay more. On health care, an employer mandate will also reduce the margins of their rivals. This is especially true for businesses of a slightly smaller size that cannot insure on the same scale or currently don’t reach the 55% of the 1.4 million Wal-Mart employees who are insured through the company. (Another 40% or so are covered by spouses or the likes of Medicaid.)

The Wal-Mart-Stern-Podesta troika made sure to specify that “shared responsibility” must be “fair and broad in its coverage,” with an emphasis on the latter. The Mom & Pop stores that liberals accuse Wal-Mart of running out of town may get hit hardest. Democrats say they’ll exempt certain small businesses, size details to be determined. But if the mandate is limited to large employers, it won’t reduce the number of uninsured. According to the Kaiser Family Foundation, 99% of firms with more than 200 workers provide health benefits, only 62% of smaller firms.

Businesses are also largely indifferent whether compensation comes in the form of wages or benefits, so an employer mandate — an indirect tax on employment — may cause wages to rise more slowly. Or it may simply mean fewer jobs.

Full article:
http://online.wsj.com/article/SB124649408574683287.html

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