Wal-Mart shows signs of self-destructing
Empty shelves and longer checkout lines are pushing many customers to Target and other rivals. What's going on?
Love it or hate it, Wal-Mart (WMT) has long been held up as a paragon of operational efficiency, spawning business school case studies and inspiring rivals to copy some of its techniques.
But recently, the retailing giant has been off its game. First, it issued a dire warning last month that February sales were a "total disaster" because of higher payroll taxes. Then, it blamed late tax refunds for a sales slowdown.
But a new report suggests that delayed refunds and tax hikes might be only part of the picture and that the retailer itself shoulders much of the blame.
"If it’s not on the shelf, I can't buy it," retired accountant Margaret Hancock told Bloomberg, describing a recent visit to Wal-Mart when she failed find a dozen basic items. "You hate to see a company self-destruct, but there are other places to go."
What's causing the problems? According to the article, Wal-Mart has the merchandise, but it's not hiring enough staff to restock shelves.
That's illustrated in the disparity between Wal-Mart's store expansion, with the company boosting new locations by 13% over the past five years, and hiring, which rose a measly 1.4% during the same time, Bloomberg notes.
Checkout lines are getting longer, and customer service has suffered, the article says.
A recent visit to a New Jersey Wal-Mart found only 12 out of 30 registers open, with lines about five customers deep, Bloomberg said. Shelves had empty spaces "large enough for a grown man to lie down." No surprise, then, that Wal-Mart placed last in among department and discount stores last month in the American Customer Satisfaction Index.
Wal-Mart said Bloomberg's report is "inaccurate and not representative of what is happening in our stores across the country."
Meanwhile, labor issues are creating a headache for Wal-Mart on another front. The company sued a major grocery workers union, citing alleged "disruptive tactics" and "illegal trespassing," as my colleague Jason Notte wrote on Tuesday.
Regardless of what's causing Wal-Mart's problems, rolling back both customer service and available merchandise generally isn't considered a recipe for retailing success.
Up here in Maine the lines waiting to check out are longer than 5 deep, usually more like 15 deep. The shelves aren't as well stocked and the usual shuffle of items on the shelves aren't helping much.
As a former employee of Wal-Mart, let me share some helpful hints. If you have the money buy your cat food, your underwear and your shampoo someplace else. Wal-Marts prices are low for a reason.
For those of you who are made of sturdier stuff never go shopping at Wal-Mart:
1. On the first week of the month. That is when a lot of the government checks come out. We use to call that Lowlife week. LOL!
2. Weekends and school holidays. Many people go to Wal-Mart because its entertaining. I use to see the same people 3 or 4 times a week. Sad but true. Weekends and school holidays are the worst.
3. The lines are shortest before 9:00 am during the week.
You can order a lot of their stuff online now.
I know this, if Sam Walton were still alive those people in charge in Bentonville would not be able to get work in Walmart as cart pushers.
I stopped shopping at Wal-Mart over their accepting check policy. If you require my signature on my check you accept my check. I will not sign both electronic and my check. Then you give my check back and put the blame back on me if I loose it and some one uses it fraudulently. Nope. Made me so angry that I drive almost 80 miles one way to do my serious grocery shopping. I have not stepped into one since. Every time, I tell someone this they shake my hand and tell me,"Me Too." So set aside the empty shelves, low pay, poor treatment of customers and employees, the automated ordering system (that never stocks the proper local items), long lines, crashing small town economy and the cheap junk they sell. I can get the same stuff else where and not have to be upset or frustrated. Thank you Wal-Mart for less stress. Oh, not that it matters your sales from one customer alone was approximately $300.00 a month nothing really until you start add how many people quit shopping at your locations. :) Happier now.
If it does go under the top dogs won't suffer.They probably already have profits hidden on foreign shores.
In Lower Bucks, the Wal-Marts seem to be off most peoples' routes at the old Shop-A-Rama site or by Neshaminy Mall. The Target and Kohl's are closer by. The former Wal-Mart site was closer by in the Fairless Hills Shopping Center where it was the anchor(technically, it's now Giant). Since it moved to Rt. 13 and the Levittown Parkway, several other stores have closed. Therefore, since I haven't been to Wal-Mart very often in the past year, this article and the response to it come as somewhat of a surprise. However, in spite of what Wal-Mart helped to do to our manufacturing base(see Frontline), we need competition.
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[BRIEFING.COM] The S&P 500 trades lower by 0.1% with one hour remaining in today's forgettable session.
Today's economic data was limited to the weekly MBA Mortgage Index (+2.8%), but tomorrow will be a bit more busy, featuring the second estimate of Q2 GDP (Briefing.com consensus 2.0%), the Pending Home Sales report for July (consensus 0.5%), and weekly initial claims (consensus 302K).
Elsewhere, Treasuries are on their highs with the 10-yr yield down four basis points at ... More
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