The Hindu Business Line : Wal-Mart Fall-Apart

Wal-Mart boasts of nearly $300 billion sales annually, 138 million customers visiting its 5,300 stores each week, and opening new stores at the rate of 1.45 a day.

For the flip side of the world's largest retailer, here is Anthony Bianco's The Bully of Bentonville, from Currency Books (www.currencybooks.com) .

`The Case against Wal-Mart', the opening chapter, alleges that in the name of the shopper, "Wal-Mart systematically bullies its workers, its suppliers, and the residents of towns and cities disinclined to submit to its expansion imperative."

The greatest threat to the company is from within, says Bianco. It seems unhappy, demoralised employees are `quitting at the rate of hundreds of thousands a year.' Attrition among hourly employees is as high as 50 per cent; and Wal-Mart spends about $2 billion a year on training about six lakh replacements.

The typical full-time employee makes "just $17,600 a year, well below the $19,157 poverty line for a family of four." The book informs that nearly one in two of the children of Wal-Mart workers `are uninsured or on Medicaid,' and employees are forced "to work extra hours without pay, either by eliminating meal and rest breaks or by having them punch out and keep working `off the clock.'"

Workers don't have a union to protect them, and are therefore filing suits. For instance, a case in Texas is on behalf of two lakh workers who claim that the company owes them $150 million "for forcing them to work through their fifteen-minute breaks over a four-year period."

Bianco devotes a chapter to the company's `war against the unions.' Techniques used include transfer, demotion and even firing. "Wal-Mart often has been accused of `flooding the unit' - that is, adding many new employees shortly before a union vote, on the theory that new employees are more likely to vote with management."

Wal-Mart's `main growth vehicle' is the Supercenter, which combines "a full-size supermarket and a regular-size discount store under one roof covering 2,00,000 square feet, or about seventeen football fields." Wal-Mart Realty is a 500-employee division that hunts for value from "the hundreds of discarded stores scattered across America's rural and suburban landscape like unburied corpses." I'm sure they have a dossier on India.

Wal-Mart's calling card is `Every Day Low Prices.' So, "when the company comes to town, it's as if everyone gets an $800 or $900 tax cut." But there are `consolidations' and `conversions,' company euphemisms for closure. "When Wal-Mart abandons a town, its departure can be just as contentious and traumatic as its entry."

For example, Nowata in Oklahoma lost its 3 per cent tax on Wal-Mart's sales when the company left the town after ravaging all the small business. The municipality had to meet the budget deficit by raising water and sewer taxes by 32 per cent and also slap a $5-a-month tax on homeowners for fire protection. "Resentment of Wal-Mart inspired a derisive new schoolyard chant: `Wal-Mart Fall-Apart!'" Is it echoing here already?

A book to add to your shopping cart before Wal-Mart comes to town!

BookMark@TheHindu.co.in