Published on: September 24, 2004In an open letter to Californians published in ads purchased in 15 of the state’s newspapers, Wal-Mart says it is attempting to set the record straight about its reputation, intentions and contributions to the community.
Conceding that it has become a target for criticism from a number of sources – including “certain elected officials, competitors and powerful special interest groups” – the company notes that “our company will continue to attract attention and even criticism in California. We will continue to listen and react to criticism that is valid. But we also will continue to react to half-truths and misinformation about our company.”
Wal-Mart’s goal has been to open 40 supercenters in the state over the next few years, but has met pockets of successful resistance in selected markets.
The complete text of the letter reads:
A Letter from Wal-Mart to the People of California.
At Wal-Mart we understand our ability to operate and grow in California depends on the support of you -- our customers. Each day we work to keep your trust by offering quality merchandise at low prices, being a good neighbor in the communities we serve and supporting economic growth throughout the state.
As the company has grown, we've become a target for negative comments from certain elected officials, competitors and powerful special interest groups. While we are always willing to consider constructive criticism, much of what has been said publicly about Wal-Mart in California is simply not true.
We think that our customers and the people of California need to know the facts:
• Wal-Mart pays competitive wages. In California our average wage is $10.37 per hour -- a rate that is in line with comparable retailers. Nearly 80 percent of our California associates (that is, employees) work full time. Many of our jobs are held by working "retirees," working spouses supplementing a family income and students working through school. For many young people, this is their entry into the work force. Wal-Mart simply could not continue to grow if we didn't offer a desirable place to work. In fact, virtually every time we open a new store, we receive a flood of applications. For example, when we prepared to open our National City, Calif. store last year, we received 15,000 applications for 350 job openings.
• Wal-Mart offers medical coverage to both full- and part-time associates. In addition to medical and dental care, our associates receive benefits like a profit sharing and 401(k) plan, merchandise discounts, performance-based bonuses and life insurance. A large percentage of associates -- 40 percent -- covered by Wal-Mart's healthcare plan didn't have any medical insurance before joining the company.
• Wal-Mart provides tremendous career opportunities. Nationally, more than 9,000 hourly associates were promoted into management jobs last year and two-thirds of our store management started their careers with Wal-Mart in hourly positions.
• Wal-Mart is planning to open as many as 40 Supercenters in California over the next few years. Supercenters combine a traditional Wal-Mart store with a full line of groceries under one roof. Customers in 47 other states currently enjoy the convenience and low prices that Wal-Mart Supercenters provide. According to a recent study by the Los Angeles Economic Development Corporation, with the entry of Wal-Mart Supercenters into Southern California, area consumers will save at least $3.7 billion annually, or $589 per household per year, once Wal-Mart reaches 20 percent market share in the region.
• Wal-Mart is an integral part of the California economy, purchasing goods and services ranging from agricultural to entertainment, high tech to consumer package goods. Last year, Wal-Mart purchased more than $8 billion in goods and services from 4,600 California suppliers. Much of what California grows and manufactures is distributed to Wal-Mart stores across the country and around the world.
• Our stores generate significant tax revenue for local communities, helping to fund important city services, including police and fire protection. In California last year, Wal-Mart generated more than $650 million in sales tax revenues.
• Giving back to our communities by supporting local organizations is very important to us. Last year, California Wal-Mart stores and SAM'S CLUBs raised and contributed more than $11 million for local causes and organizations throughout the state. Overall, Wal-Mart is the largest corporate cash contributor to charity in the United States.
In closing, we expect that our company will continue to attract attention and even criticism in California. We will continue to listen and react to criticism that is valid. But we also will continue to react to half-truths and misinformation about our company. Our customers, communities and associates in California deserve nothing less.
- KC's View:
- Is the letter emblematic of a kinder, gentler Wal-Mart? Or is the company serving notice that “resistance is futile”?
Either way. you can’t blame Wal-Mart for trying, though it is interesting that the advertisement doesn’t really address the “culture change” that CEO Lee Scott said just a few weeks ago that the company needed to achieve. Rather, this ad seems almost completely defensive…
It’s a neat trick, suggesting that Californians are going save gobs of money…but only if Wal-Mart is allowed to achieve a 20 percent market share. Maybe the Governator should simply close down some of Wal-Mart’s competitors so that he and the Bentonville Behemoth can provide the public service of giving consumers the lowest prices. On the other hand, maybe…just maybe…low prices aren’t always everybody’s biggest concern.
Based on the way Wal-Mart describes the people it is hiring, one would almost expect that the company would be posting plaques over the front door that say, “Give us your tired, your poor, your huddled masses…”
We clearly aren’t going to debate Wal-Mart on its numbers and statistics, though we would point out that it is big enough to qualify as its own “special interest group,” and that the “economic growth” that Wal-Mart is most interested in is its own.
And while we don’t have specifics with which to question the Wal-Mart numbers, we have to say that the line that most surprised us was the assertion that almost 80 percent of its store employees in California are full-time – a statement that, if true, would fly in the face of conventional wisdom. (What’d we really like to know is how Wal-Mart is defining “full-time.” We suspect it might be different than we’d define it…)
Wal-Mart also better hope that the courts don’t blow a hole in its attempts to repair its image…that it doesn’t lose the lawsuit that charges it with gender discrimination, which could give it something of a black eye.
Ironic that on the same day that Wal-Mart was advertising its good intentions, the company was sued in a federal court by a job applicant who charged that the company discriminates against black employees seeking work as truck drivers. The plaintiff’s attorney reportedly is seeking class action status in the case…which just goes to show that Wal-Mart is right about one thing – that rightly or wrongly, it continues to be a lightning rod for controversy and attacks.
Doesn’t matter, though. Resistance is futile.