retail news in context, analysis with attitude

Got some email regarding Walmart's announcement that it is going to be giving 500,000 employees raises to at least $9 per hour.

MNB reader Jim Swoboda wrote:

First time in a long time I have found myself saying “way to go Walmart”  I have thought for years, the best way to win is at that point when you are in front of your customer.  Costco figured it out long ago.

From another reader:

Look…I am no fan of Walmart. I never, ever, shop there. In my opinion they arrive in a town and drive out many of the small & local businesses that have the misfortune to be in close proximity. For the most part, I feel that WM is a company that has, for years, taken advantage of the lower income folks that work (and shop) there.

But this is a game-changer and they deserve credit for taking this approach. Not sure what the cost will be to implement the new wage levels & employee raises, but I’m pretty sure it’s enough to debunk the stunt or “gimmick”  theory.

It may be that they expect to see a return on their investment, as well. Much of that additional income is likely to be spent right back at the store where they work.

And another:

Couldn’t help but see parallels between Walmart’s hiring and remuneration practices and that of N Korea, shipping off citizens to serve as indentured servants in foreign countries where they have virtually all of their salary taken by the state and sent back to N Korea as much-needed foreign capital. There for years sometimes, they come home with no more than 10% of what was promised.
How does this parallel Walmart?  Despite raising wages to $10 per hour, they still keep workers dangling with respect to the number of hours they are assigned. So work fewer than 40 hours – say 28 or even 20 and you starve.  You cannot take on another job to fill those hours, because any other likely employer expects her (or him) to have the “flexibility” to conform to their needs. 
How about Walmart just guarantees their workers a minimum of 40 hours per week, thus giving them a fighting chance of surviving?

Here's how I think we ought to evaluate the success of the Walmart raises.

Six months from now, let's see how many of those 500,000 employees have been able to quit their second jobs, because they've gotten more hours and higher pay from Walmart. To me, that'll be the difference between a policy with teeth and one that is mostly cosmetic.

On another subject, MNB reader Chris Utz wrote:

Starbucks quit selling CDs???  I’m quite shocked.

I play my Oldies ‘records’ streamed from iCloud- beamed wirelessly to my entertainment system through my iPhone, iPad or Mac; whichever is handy. ...
No wonder Starbucks quit selling CDs.    Wonder if they will quit selling buggy whips?

On this one, Starbucks did seem like it may have stayed at the party a little too long. But considering how progressive they are about digital, it'll be interesting to see how they replace this small but integral part of their business.
KC's View: