Wal-Mart Stores, Inc.

(formerly branded as Wal-Mart, branded as Walmart since 2008)

(NYSE: WMT) is an American public multinational corporation that runs a chain of large
discount department stores and a chain of warehouse stores. In 2010 it was the world's largest
public corporation by revenue, according to the Forbes Global 2000 for that year.[6] The
company was founded by Sam Walton in 1962, incorporated on October 31, 1969, and
publicly traded on the New York Stock Exchange in 1972. Wal-Mart, headquartered in
Bentonville, Arkansas, is the largest majority private employer[7] and the largest grocery
retailer in the United States. In 2009, it generated 51% of its US$258 billion sales in the U.S.
from grocery business.[8] It also owns and operates the Sam's Club retail warehouses in North
America.

Wal-Mart has 8,500 stores in 15 countries, with 55 different names.[9] The company operates
under its own name in the United States, including the 50 states. It also operates under its own
name in Puerto Rico. Wal-Mart operates in Mexico as Walmex, in the United Kingdom as
Asda ("Asda Wal-Mart" in some branches), in Japan as Seiyu, and in India as Best Price. It
has wholly owned operations in Argentina, Brazil, and Canada. Wal-Mart's investments
outside North America have had mixed results: its operations in the United Kingdom, South
America and China are highly successful, while it was forced to pull out of Germany and
South Korea when ventures there were unsuccessful.

Contents
[hide]

 1 History
o 1.1 Incorporation and growth
o 1.2 Recent initiatives
 1.2.1 Healthy foods initiative
 2 Operating divisions
o 2.1 Wal-Mart Stores U.S.
 2.1.1 Walmart Discount Stores
 2.1.2 Walmart Supercenter
 2.1.3 Neighborhood Market by Walmart
 2.1.4 Supermercado de Wal-Mart
 2.1.5 Marketside
o 2.2 Sam's Club
o 2.3 Wal-Mart International
 2.3.1 Wal-Mart Canada Bank
o 2.4 Private label brands
o 2.5 Entertainment
 3 Corporate affairs
o 3.1 Financial
o 3.2 Governance
o 3.3 Competition
o 3.4 Customer base
o 3.5 Economic impact
o 3.6 Employee and labor relations
o 3.7 Gender and sexual orientation
  4 See also
o 4.1 Television and film
o 4.2 Other
 5 References
 6 Further reading
 7 External links

History

Sam Walton's original Walton's Five and Dime store in Bentonville, Arkansas, now serving as
the Wal-Mart Visitor's Center
Main article: History of Wal-Mart

Sam Walton, a businessman from Arkansas, began his retail career when he started work on
June 3, 1940, at a J. C. Penney store in Des Moines, Iowa where he remained for 18 months.
In 1945, he met Butler Brothers, a regional retailer that owned a chain of variety stores called
Ben Franklin and that offered him one in Newport, Arkansas.[10]

Walton was extremely successful in running the store in Newport, far exceeding expectations.
[11]
However, when the lease came up for renewal, Walton could neither come to agreement on
the existing store's lease renewal nor find a new location in Newport. Instead, he opened a
new Ben Franklin franchise in Bentonville, Arkansas, but called it "Walton's Five and Dime."
There, he achieved higher sales volume by marking up slightly less than most competitors.[12]

On July 2, 1962, Walton opened the first Wal-Mart Discount City store located at 719 Walnut
Ave. in Rogers, Arkansas. The building is now occupied by a hardware store and an antique
mall. Within five years, the company expanded to 24 stores across Arkansas and reached
$12.6 million in sales.[13] In 1968, it opened its first stores outside Arkansas, in Sikeston,
Missouri and Claremore, Oklahoma.[14]

Incorporation and growth

The company was incorporated as Wal-Mart Stores, Inc. on October 31, 1969. In 1970, it
opened its home office and first distribution center in Bentonville, Arkansas. It had 38 stores
operating with 1,500 employees and sales of $44.2 million. It began trading stock as a
publicly held company on October 1, 1970, and was soon listed on the New York Stock
Exchange. The first stock split occurred in May 1971 at a market price of $47. By this time,
Wal-Mart was operating in five states: Arkansas, Kansas, Louisiana, Missouri, and
Oklahoma; it entered Tennessee in 1973 and Kentucky and Mississippi in 1974. As it moved
into Texas in 1975, there were 125 stores with 7,500 employees and total sales of $340.3
million.[14] Wal-Mart opened its first Texas store in Mount Pleasant on November 11, 1975.[15]

Logo used from 1992-2008 (2001-2009 in Canada, 1992-2009 in Mexico, although Mexico
used the current logo in December 2008). It is still used in Mainland China. Still seen on
many American locations, even though a majority of Canadian locations have this logo rather
than the 1994-2001 Wal-Mart Canada logo with a hyphen.

In the 1980s, Walmart continued to grow rapidly, and by its 25th anniversary in 1987 there
were 1,198 stores with sales of $15.9 billion and 200,000 associates.[14] This year also marked
the completion of the company's satellite network, a $24 million investment linking all
operating units of the company with its Bentonville office via two-way voice and data
transmission and one-way video communication. At the time, it was the largest private
satellite network, allowing the corporate office to track inventory and sales and to instantly
communicate to stores.[16] In 1988, Sam Walton stepped down as CEO and was replaced by
David Glass.[17] Walton remained as Chairman of the Board, and the company also rearranged
other people in senior positions.

Inside a Walmart Supercenter in West Plains, Missouri

In 1988, the first Walmart Supercenter opened in Washington, Missouri.[18] Thanks to its
superstores, it surpassed Toys "R" Us in toy sales in the late 1990s.[19] The company also
opened overseas stores, entering South America in 1995 with stores in Argentina and Brazil;
and Europe in 1999, buying Asda in the UK for $10 billion.[20]

In 1998, Walmart introduced the "Neighborhood Market" concept with three stores in
Arkansas.[21] By 2005, estimates indicate that the company controlled about 20% of the retail
grocery and consumables business.[22]

In 2000, H. Lee Scott became President and CEO, and Walmart's sales increased to $165
billion.[23] In 2002, it was listed for the first time as America's largest corporation on the
Fortune 500 list, with revenues of $219.8 billion and profits of $6.7 billion. It has remained
there every year, except for 2006.[24][25]

In 2005, Walmart had $312.4 billion in sales, more than 6,200 facilities around the world—
including 3,800 stores in the United States and 2,800 elsewhere, employing more than 1.6
million "associates" worldwide. Its U.S. presence grew so rapidly that only small pockets of
the country remained further than 60 miles (100 km) from the nearest Wal-Mart.[26]

As Walmart grew rapidly into the world's largest corporation, many critics worried about the
effect of its stores on local communities, particularly small towns with many "mom and pop"
stores. There have been several studies on the economic impact of Walmart on small towns
and local businesses, jobs, and taxpayers. In one, Kenneth Stone, a Professor of Economics at
Iowa State University, found that some small towns can lose almost half of their retail trade
within ten years of a Wal-Mart store opening.[27] However, in another study, he compared the
changes to what small town shops had faced in the past — including the development of the
railroads, the advent of the Sears Roebuck catalog, as well as the arrival of shopping malls —
and concluded that shop owners who adapt to changes in the retail market can thrive after
Wal-Mart arrives.[27] A later study in collaboration with Mississippi State University showed
that there are "both positive and negative impacts on existing stores in the area where the new
supercenter locates."[28]

In the aftermath of Hurricane Katrina in September 2005, Walmart was able to use its
logistical efficiency in organizing a rapid response to the disaster, donating $20 million in
cash, 1,500 truckloads of free merchandise, food for 100,000 meals, as well as the promise of
a job for every one of its displaced workers.[29] An independent study by Steven Horwitz of St.
Lawrence University found that Walmart, The Home Depot and Lowe's made use of their
local knowledge about supply chains, infrastructure, decision makers and other resources to
provide emergency supplies and reopen stores well before FEMA began its response.[30] While
the company was overall lauded for its quick response – amidst the criticisms of the Federal
Emergency Management Agency – several critics were nonetheless quick to point out that
there still remain issues with the company's labor relations.[31]

Recent initiatives

In October 2005, Wal-Mart announced it would implement several environmental measures to

increase energy efficiency. The primary goals included spending $500 million a year to
increase fuel efficiency in Wal-Mart’s truck fleet by 25% over three years and double it
within ten, reduce greenhouse gas emissions by 20% in seven years, reduce energy use at
stores by 30%, and cut solid waste from U.S. stores and Sam’s Clubs by 25% in three years.
CEO Lee Scott said that Wal-Mart's goal was to be a "good steward for the environment" and
ultimately use only renewable energy sources and produce zero waste.[32] The company also
designed three new experimental stores in McKinney, Texas, Aurora, Colorado, and Las
Vegas, Nevada. with wind turbines, photovoltaic solar panels, biofuel-capable boilers, water-
cooled refrigerators, and xeriscape gardens.[33] Despite much criticism of its environmental
record, Wal-Mart took a few steps in what is viewed as a positive direction, which included
becoming the biggest seller of organic milk and the biggest buyer of organic cotton in the
world, as well as reducing packaging and energy costs.[34] Wal-Mart also spent nearly a year
working with outside consultants to discover the company's total environmental impact and
find where they could improve. They discovered, for example, that by eliminating excess
packaging on their toy line Kid Connection, they could not only save $2.4 million a year in
shipping costs but also 3,800 trees and a million barrels of oil.[34] Walmart has also recently
created its own electric company in Texas, Texas Retail Energy, and plans to supply its stores
with cheap power purchased at wholesale prices. Through this new venture, the company
expects to save $15 million annually and also lays the groundwork and infrastructure to sell
electricity to Texas consumers in the future.[35]
In March 2006, Walmart sought to appeal to a more affluent demographic. The company
launched a new Supercenter concept in Plano, Texas, intended to compete against stores seen
as more upscale and appealing, such as Target.[36][37] The new store has wood floors, wider
aisles, a sushi bar, a coffee/sandwich shop with free Wi-Fi Internet access, and more
expensive beers, wines, electronics, and other goods. The exterior has a hunter green
background behind the Wal-Mart letters, similar to Neighborhood Market by Walmarts,
instead of the blue previously used at its supercenters.

On September 12, 2007, Walmart introduced new advertising with the slogan, "Save Money
Live Better," replacing the "Always Low Prices, Always" slogan, which it had used for the
previous 19 years. Global Insight, which conducted the research that supported the ads, found
that Walmart's price level reduction resulted in savings for consumers of $287 billion in 2006,
which equated to $957 per person or $2,500 per household (up 7.3% from the 2004 savings
estimate of $2,329).[38]

On June 30, 2008, Walmart unveiled a new company logo, featuring the non-hyphenated
name "Walmart" and in place of the star, a symbol that resembles a sunburst or flower. The
new logo received mixed reviews from some design critics, who questioned whether the new
logo was as bold as competitors, such as the Target bullseye or as instantly recognizable as
the former company logo, which was used for 18 years.[39] The new logo made its debut on the
company's walmart.com website on July 1, 2008. Walmart's U.S. locations were to update
store logos in the fall of 2008, as part of an ongoing evolution of its overall brand.[40] Wal-
Mart Canada started to adopt the logo for its stores in early 2009.

On March 20, 2009, Wal-Mart announced that it is paying a combined $933.6 million in
bonuses to every full and part time hourly worker of the company. An additional $788.8
million in profit sharing, 401(k) contributions, and hundreds of millions of dollars in
merchandise discounts and contributions to the employees' stock purchase plan is also
included in this plan. While the economy at large was in an ongoing recession, the largest
retailer in the U.S. reported solid financial figures for the most recent fiscal year (ending
January 31, 2009), with $401.2 billion in net sales, a gain of 7.2% from the prior year. Income
from continuing operations increased 3% to $13.3 billion, and earnings per share rose 6% to
$3.35.[41]

On July 16, 2009, Wal-Mart announced plans to develop a worldwide sustainable product
index.[42]

On February 22, 2010, the company confirming it was acquiring video streaming company
Vudu, Inc. for an estimated $100 million.[43]

Healthy foods initiative

In January, 2011, at the urging of Michelle Obama and her staff, Wal-Mart announced a
program to improve the nutritional values of its store brands over the next five years,
gradually reducing the amount of salt and sugar, and eliminating trans fat. Wal-Mart also
promised to negotiate with suppliers such as Kraft with respect to nutritional issues.
Reductions in the prices of whole foods and vegetables were also promised as well as efforts
to open stores in low-income areas, "food deserts", where there are no supermarkets.[44]

Operating divisions
See also: List of assets owned by Wal-Mart Stores, Inc.

Wal-Mart's operations are organized into three divisions: Wal-Mart Stores U.S., Sam's Club,
and Wal-Mart International.[45] The company does business in nine different retail formats:
supercenters, food and drugs, general merchandise stores, bodegas (small markets), cash and
carry stores, membership warehouse clubs, apparel stores, soft discount stores and restaurants.
[45]

A panoramic photo of a remodeled Walmart Supercenter in Laurel, Maryland.

Wal-Mart Stores U.S.

Map of current Wal-Mart stores in the U.S.

Wal-Mart Stores U.S. is Wal-Mart's largest division, accounting for $258 billion, or 63.8% of
total sales for financial year 2010.[45] It consists of three retail formats that have become
commonplace in the United States: Discount Stores, Supercenters, and Neighborhood
Markets. The retail department stores sell a variety of mostly non-grocery products, though
emphasis has now shifted towards supercenters, which include more grocery items. This
division also includes Wal-Mart's online retailer, walmart.com.

In September 2006, Wal-Mart announced a pilot program to sell generic drugs at just $4 per
prescription. The pilot program was launched at stores in the Tampa, Florida area, and
expanded to all stores in Florida by January 2007. While the average price of generics is $29
per prescription, compared to $102 for name-brand drugs, Wal-Mart maintains that it is not
selling at a loss, or providing as an act of charity – instead, they are using the same
mechanisms of mass distribution that it uses to bring lower prices to other products.[46] While
it's little known outside of the drug industry, many of Walmart’s low cost generics are
imported from India and made by drug makers in that country including Ranbaxy and CIPLA.
[47]
On February 6, 2007, the company launched a "beta" version of a movie download service,
which sold about 3,000 films and television episodes from all major studios and television
networks.[48] The service was discontinued on December 21, 2007 due to low sales.[49]

Walmart Discount Stores

A typical Wal-Mart discount department store in Laredo, Texas

Walmart Discount Stores are discount department stores with size varying from 51,000 square
feet (4,738.1 m2) to 224,000 square feet (20,810.3 m2), with an average store covering about
102,000 square feet (9,476.1 m2).[45] They carry general merchandise and a selection of
groceries. Many of these stores also have a garden center, a pharmacy, Tire & Lube Express,
optical center, one-hour photo processing lab, portrait studio, a bank branch, a cell phone
store and a fast food outlet. Some also have gasoline stations.[50]

The first Wal-Mart store opened in Rogers, Arkansas in 1962.

In 1990, Wal-Mart opened its first Bud's Discount City location in Bentonville. Bud's
operated as a closeout store, much like Big Lots. Many locations were opened to fulfill leases
in shopping centers as Wal-Mart stores left and moved into newly built Supercenters. All of
the Bud's Discount City stores closed or converted into Wal-Mart Discount Stores by 1997.[13]
[51]

As of October 2010, there were 750 Walmart Discount Stores in the United States. In 2006,
the busiest in the world was one in Rapid City, South Dakota.[52]

Walmart Supercenter

A picture of a remodeled Wal-Mart Supercenter in Miami, Florida.

Wal-Mart Supercenters are hypermarkets with size varying from 98,000 to 261,000 square
feet (9,104.5 to 24,247.7 m2), with an average of about 197,000 square feet (18,301.9 m2).[45]
These stock everything a Wal-Mart Discount Store does, and also include a full-service
supermarket, including meat and poultry, baked goods, delicatessen, frozen foods, dairy
products, garden produce, and fresh seafood. Many Wal-Mart Supercenters also have a garden
center, pet shop, pharmacy, Tire & Lube Express, optical center, one-hour photo processing
lab, portrait studio, and numerous alcove shops, such as cellular phone stores, hair and nail
salons, video rental stores, local bank branches (newer locations have Woodforest National
Bank branches), and fast food outlets — usually Subway, but sometimes Dunkin' Donuts,
McDonald's or Blimpie. Some also sell gasoline distributed by Murphy Oil Corporation
(whose Wal-Mart stations are branded as "Murphy USA"), Sunoco, Inc. ("Optima"), or
Tesoro Corporation ("Mirastar").[50]

The first Supercenter opened in 1988 in Washington, Missouri. A similar concept, Hypermart
USA, opened in Garland, Texas a year earlier. All of the Hypermart USA stores were later
closed or converted into Supercenters.

As of October 2010, there were 2,843 Wal-Mart Supercenters in the United States.[52] The
largest Supercenter in the United States, covering 260,000 square feet (24,154.8 m2) and two
floors, is located in Crossgates Commons in Albany, New York.[53]

Since the introduction of the new Wal-Mart logo in 2008, the company has been phasing out
the "Supercenter" portion of the name on these stores, simply referring to these stores as
"Walmart."

Neighborhood Market by Walmart

Neighborhood Markets by Walmart are grocery stores that average about 42,000 square feet
(3,901.9 m2).[45] They are used to fill the gap between Discount Store and Supercenters,
offering a variety of products, which include full lines of groceries, pharmaceuticals, health
and beauty aids, photo developing services, and a limited selection of general merchandise.

The first Neighborhood Market opened in 1998 in Bentonville, Arkansas. As of October

2010, there were 181 of them in the United States.[52]

Neighborhood Market by Walmart now has the same logo as Wal-Mart does. However, this
change took place a few months after the new logo was introduced on June 30, 2008.

Supermercado de Wal-Mart
Supermercado de Wal-Mart in Spring Branch, Houston

Wal-Mart opened "Supermercado de Wal-Mart" locations to appeal to Hispanic communities

in the United States.[54] The first one, a 39,000 square feet (3,600 m2) store in the Spring
Branch area of Houston, opened on Wednesday April 29, 2009.[55] The store was a conversion
of an existing Wal-Mart.[56][57] Wal-Mart also planned to open "Mas Club," a warehouse retail
operation patterned after Sam's Club.[58]

Marketside

Main article: Marketside

Marketside is a new chain of grocery stores opened in October 2008, the stores are said to be
less than half the size of a conventional supermarket, as stated in the backgrounder found on
Wal-Mart's official homepage. As of October 2010, there were four Marketside stores, all
within the state of Arizona.[52] Each of these stores is open from 7 a.m. to 10 p.m.

Sam's Club

Main article: Sam's Club

A typical Sam's Club store in Maplewood, Missouri

Sam's Club is a chain of warehouse clubs which sell groceries and general merchandise, often
in large quantities. Sam's Club stores are "membership" stores and most customers buy annual
memberships. However, non-members can make purchases either by buying a one-day
membership or paying a surcharge based on the price of the purchase.[59] Some locations also
sell gasoline.[50] The first Sam's Club opened in 1983 in Midwest City, Oklahoma[59] under the
name "Sam's Wholesale Club".

Sam's has found a niche market in recent years as a supplier to small businesses. All Sam's
Club stores are open early hours exclusively for business members and their old slogan was
"We're in Business for Small Business." Their current slogan is "Savings Made Simple" as
Sam's Club attempts to attact a more diverse member base. In March 2009, the company
announced that it plans to enter the electronic medical records business by offering a software
package to physicians in small practices for $25,000. Wal-Mart is partnering with Dell and
eClinicalWorks.com in this new venture.[60]
Sam's Club's sales during 2010 were $47 billion, or 11.5% of Wal-Mart's total sales.[45] As of
October 2010, there were 607 Sam's Clubs in the United States. Wal-Mart also operates more
than 100 international Sam’s Clubs in Brazil, China, Mexico, and Puerto Rico.[61]

Wal-Mart International

Wal-Mart's international operations currently comprise 4,263 stores and 660,000 workers in
15 countries outside the United States.[62] There are wholly owned operations in Argentina,
Brazil, Canada,and the UK. With 2.1 million employees worldwide, the company is the
largest private employer in the US and Mexico, and one of the largest in Canada.[63] In the
financial year 2010, Wal-Mart's international division sales were $100 billion, or 24.7% of
total sales.[45]

Wal-Mart has operated in Canada since its acquisition of 122 stores comprising the Woolco
division of Woolworth Canada, Inc in 1994. As of July 2010, it operates over 300 locations
(including 100 Supercentres) and employs 82,000 Canadians, with a local home office in
Mississauga, Ontario.[64] Walmart Canada's first three Supercentres (spelled as in Canadian
English) opened on November 8, 2006, in Hamilton, London, and Aurora, Ontario. The 100th
Canadian Supercentre opened on July 10, 2010, in Victoria, BC.

Wal-Mart's UK subsidiary, Asda

Sales in 2006 for Wal-Mart's UK subsidiary, Asda (which retains the name it had before
acquisition by Wal-Mart), accounted for 42.7% of sales of Wal-Mart's international division.
In contrast to Wal-Mart's US operations, Asda was originally and still remains primarily a
grocery chain, but with a stronger focus on non-food items than most UK supermarket chains
other than Tesco. As of 2010, Asda had 345 stores, some of which were former Woolco stores
operated by the UK division of FW Woolworth. The stores are branded Asda Wal-Mart
Supercentres, as well as Asda Supermarkets, Asda Living, George High Street and Asda
Essentials stores.[65]

In addition to its wholly owned international operations, Wal-Mart has joint ventures in China
and several majority-owned subsidiaries. Wal-Mart's majority-owned subsidiary in Mexico is
Walmex. In Japan, Wal-Mart owns about 53% of Seiyu.[66] Additionally, Wal-Mart owns 51%
of the Central American Retail Holding Company (CARHCO), consisting of more than 360
supermarkets and other stores in Guatemala, El Salvador, Honduras, Nicaragua, and Costa
Rica.[67]
Bompreço in Natal, Brazil.

In 2004, Wal-Mart bought the 116 stores in the Bompreço supermarket chain in northeastern
Brazil. In late 2005, it took control of the Brazilian operations of Sonae Distribution Group
through its new subsidiary, WMS Supermercados do Brasil, thus acquiring control of the
Nacional and Mercadorama supermarket chains, the leaders in the Rio Grande do Sul and
Paraná states, respectively. None of these was rebranded. As of April 2010, Wal-Mart
operates 64 Super-Bompreço stores, 33 Hyper-Bompreço stores. It also runs 45 Wal-Mart
Supercenters, 24 Sam's Club stores, and 101 Todo Dia stores. With the acquisition of
Bompreço and Sonae, Wal-Mart is currently the third largest supermarket chain in Brazil,
behind Carrefour and Pão de Açúcar.[68]

In June 2006, Wal-Mart was excluded from the investment portfolio of The Government
Pension Fund of Norway, which held stock values of about US$ 430 million in the company,
due to a social audit into alleged labor rights violations in the company's operations in the US
and worldwide.[69][70] Although Wal-Mart did not respond to questions from the fund's
auditors, the company later claimed the decision "don't appear to be based on complete
information".[71]

In November 2006, Wal-Mart announced a joint venture with Bharti Enterprises to open retail
stores in India. As foreign corporations are not allowed to directly enter the retail sector in
India, Wal-Mart will operate through franchises and handle the wholesale end.[72] The
partnership will involve two joint ventures; Bharti will manage the front end involving
opening of retail outlets, while Wal-Mart will take care of the back end, such as cold chains
and logistics.

In 2008, Wal-Mart named German retailing veteran Stephan Fanderl as the president of Wal-
Mart Emerging Markets-East in an effort to, "explore retail business opportunities in Russia
and neighboring markets." The market is estimated to be worth more than US$140 billion per
year in food sales alone.[73]

In January 2009, the company acquired a controlling interest in the largest grocer in Chile,
Distribucion y Servicio D&S SA.[74]

In February 2010, the company agreed to buy Vudu, a Silicon Valley start-up whose three-
year-old online movie service is being built into an increasing number of televisions and Blu-
ray players. Terms of the acquisition were not disclosed, but a person briefed on the deal said
the price for the company, which raised $60 million in capital, was over $100 million.[75]

On September 28, 2010, Wal-Mart announced it would buy Massmart Holdings Ltd. of
Johannesburg, South Africa in a deal worth over $4 billion, giving the company its first stores
in Africa.[9]

Wal-Mart Canada Bank

Wal-Mart Canada launched its application for banking license in 2008 to compete with
similar stores in Canada such as Loblaw.[76] On July 24, 2009, Wal-Mart Canada Bank was
incorporated under the Bank Act in Canada.[77]

On June 15, 2010, Wal-Mart officially launched into the banking sector under the name Wal-
Mart Canada Bank (French: La Banque Wal-Mart du Canada).[78] As a Schedule II federal
financial institution, it is regulated by the Office of the Superintendent of Financial
Institutions.[79] Currently, WMCB only offers a Mastercard product but could offer more
banking services in the future.[80]

Private label brands

Main article: List of Wal-Mart brands

About 40% of products sold in Wal-Mart are private label store brands, or products offered by
Wal-Mart and produced through contracts with manufacturers. Wal-Mart began offering
private label brands in 1991 with the launch of Sam's Choice, a brand of drinks produced by
Cott Beverages exclusively for Wal-Mart. Sam's Choice quickly became popular, and by 1993
was the third most popular beverage brand in the United States.[81] Other Wal-Mart brands
include Great Value and Equate in the US and Canada, and Smart Price in Britain. A 2006
study talked of "the magnitude of mind-share Wal-Mart appears to hold in shoppers' minds
when it comes to awareness of private label brands and retailers."[82]

Entertainment

In 2010, Wal-Mart teamed with Procter & Gamble to produce Secrets of the Mountain and
The Jensen Project, 2 hour family movies which featured the characters using Wal-Mart and
Procter & Gamble branded products. The Jensen Project also featured a preview of a product
to be released in several months in Wal-Mart stores.[83][84] A third movie, A Walk in My
Shoes, will air later in 2010 and a fourth is in production.[85] Wal-Mart's director of brand
marketing also serves as co-chair of the Association of National Advertisers's Alliance for
Family Entertainment.[86]

Corporate affairs

Wal-Mart Home Office in Bentonville, Arkansas

Wal-Mart is headquartered in the Wal-Mart Home Office complex in Bentonville, Arkansas.

[87]
Wal-Mart's business model is based on selling a wide variety of general merchandise at
"always low prices."[45] The company refers to its employees as "associates". All Wal-Mart
stores in the US and Canada also have designated "greeters", who welcome shoppers at the
store entrance.[88]

In June, 2007. Wal-Mart announced it was retiring the blue vest its 1.5 million associates
wear, and replacing it with khakis and polos. The replacement was to help Wal-Mart increase
sales.

Unlike many other retailers, Wal-Mart does not charge a slotting fee to suppliers for their
products to appear in the store.[89] Instead, it focuses on selling more popular products and
provides incentives for store managers to drop unpopular products, as well as asking
manufacturers to supply more popular products.[89]

On September 14, 2006, the company announced that it would phase out its layaway program,
citing declining use and increased costs.[90] Layaway ceased to be offered on November 19,
2006, and required merchandise pickup by December 8, 2006. Wal-Mart now focuses on
other payment options, such as increased use of six- and twelve-month, zero-interest
financing. The layaway location in most stores is now used for Wal-Mart's Site-To-Store
program, which was introduced in March 2007. This enables walmart.com customers to buy
goods online with a free shipping option, and have goods shipped to the nearest store for
pickup.[91]

Financial

For the fiscal year ending January 31, 2009, Wal-Mart reported a net income of $13.6
billion[5] on $404 billion of revenue[2] (3.4% profit margin). For the fiscal year ending January
31, 2006, Wal-Mart's international operations accounted for about 20.1% of total sales.[45]

Governance

Wal-Mart is governed by a fifteen-member Board of Directors, which is elected annually by

shareholders. Robson Walton, the eldest son of founder Sam Walton, serves as Chairman of
the Board. Michael T. Duke serves as Chief Executive Officer (CEO), and Lee Scott,
formerly CEO, serves as Chairman of the Executive Committee of the Board. Other members
of the board include Aída Álvarez, Jim Breyer, M. Michele Burns, James Cash, Roger
Corbett, Douglas Daft, David Glass, Gregory B. Penner, Allen Questrom, Arne M. Sorenson,
Jim Walton, Christopher J. Williams, and Linda S. Wolf.[92] Sam Walton died in 1992. After
Walton's death, Don Soderquist, Chief Operating Officer and Senior Vice Chairman, became
known as the "Keeper of the Culture."[93][94]

Notable former members of the board include Hillary Clinton (1985–1992)[95] and Tom
Coughlin (2003–2004), the latter having served as Vice Chairman. Clinton left the board
before the 1992 U.S. Presidential Election, and Coughlin left in December 2005 after pleading
guilty to wire fraud and tax evasion for stealing hundreds of thousands of dollars from Wal-
Mart.[96] On August 11, 2006, he was sentenced to 27 months of home confinement, five years
of probation, and ordered to pay US$411,000 in restitution.[97]

Competition
In North America, Wal-Mart's primary competition includes department stores like Kmart,
Target, ShopKo and Meijer, Canada's Zellers, Hart the Real Canadian Superstore and Giant
Tiger, and Mexico's Comercial Mexicana and Soriana. Competitors of Wal-Mart's Sam's Club
division are Costco, and the smaller BJ's Wholesale Club chain operating mainly in the
eastern US. Wal-Mart's move into the grocery business in the late 1990s also set it against
major supermarket chains in both the United States and Canada. Several smaller retailers,
primarily dollar stores, such as Family Dollar and Dollar General, have been able to find a
small niche market and compete successfully against Wal-Mart for home consumer sales.[98]
In 2004, Wal-Mart responded by testing its own dollar store concept, a subsection of some
stores called "Pennies-n-Cents."[99]

Wal-Mart also had to face fierce competition in some foreign markets. For example, in
Germany it had captured just 2% of German food market following its entry into the market
in 1997 and remained "a secondary player" behind Aldi with a 19% share.[100] In July 2006,
Wal-Mart announced its withdrawal from Germany. Its stores were sold to German company
Metro.[101] Wal-Mart continues to do well in the UK, and its Asda subsidiary is the second
largest chain after Tesco.[102]

In May 2006, after entering the South Korean market in 1998, Wal-Mart withdrew and sold
all 16 of its South Korean outlets to Shinsegae, a local retailer, for $882 million. Shinsegae re-
branded the Wal-Marts as E-mart stores.[103]

Wal-Mart struggled to export its brand elsewhere as it rigidly tried to reproduce its model
overseas. In China, Wal-Mart hopes to succeed by adapting and doing things preferable to
Chinese citizens. For example, it found that Chinese consumers preferred to select their own
live fish and seafood; stores began displaying the meat uncovered and installed fish tanks,
leading to higher sales.[104]

Customer base

Street sign for Wal ★ Mart Drive near Gordon, Pennsylvania

A price of 15 cents on folders and notebooks

Each week, about 100 million customers, nearly one-third of the U.S. population, visit
Walmart's U.S. stores.[105] Walmart customers give low prices as the most important reason for
shopping there, reflecting the "Low prices, always" advertising slogan that Wal-Mart used
from 1962 until 2006.[106] The average US Wal-Mart customer's income is below the national
average, and analysts recently estimated that more than one-fifth of them lack a bank account,
twice the national rate.[107] A Wal-Mart financial report in 2006 also indicated that Wal-Mart
customers are sensitive to higher utility costs and gas prices.[108] A poll indicated that after
2004 US Presidential Election 76% of voters who shopped at Wal-Mart once a week voted for
George W. Bush, while only 23% supported senator John Kerry.[109] When measured against
other similar retailers in the U.S., frequent Wal-Mart shoppers were rated the most politically
conservative.[110]

In 2006, Wal-Mart took steps to expand its US customer base, announcing a modification in
its US stores from a "one-size-fits-all" merchandising strategy to one designed to "reflect each
of six demographic groups – African-Americans, the affluent, empty-nesters, Hispanics,
suburbanites and rural residents."[111] Around six months later, it unveiled a new slogan:
"Saving people money so they can live better lives". This reflects the three main groups into
which Wal-Mart categorizes its 200 million customers: "brand aspirationals" (people with low
incomes who are obsessed with names like KitchenAid), "price-sensitive affluents" (wealthier
shoppers who love deals), and "value-price shoppers" (people who like low prices and cannot
afford much more).[106] Wal-Mart has also made steps to appeal to more liberal customers, for
example, by rejecting the American Family Association's recommendations and carrying the
DVD Brokeback Mountain, a love story between two gay cowboys in Wyoming.[112]

Economic impact

See also: Criticism of Wal-Mart

Wal-Mart is the largest corporation in the world.[24]

Kenneth Stone, Professor of Economics at Iowa State University, in a paper published in

Farm Foundation in 1997, found that some small towns can lose almost half of their retail
trade within ten years of a Wal-Mart store opening.[27] However, he compared the changes to
previous competitors small town shops have faced in the past—from the development of the
railroads and the Sears Roebuck catalog to shopping malls. He concludes that shop owners
who adapt to the ever changing retail market can thrive after Wal-Mart comes to their
community.[27] A subsequent study in collaboration with Mississippi State University
indicated that there are "both positive and negative impacts on existing stores in the area
where the new supercenter locates."[28]

A June 2006 article published by the libertarian Ludwig von Mises Institute suggested that
Wal-Mart has a positive impact on small business.[113] It argued that while Wal-Mart's low
prices caused some existing businesses to close, the chain also created new opportunities for
other small business, and so "the process of creative destruction unleashed by Wal-Mart has
no statistically significant impact on the overall size of the small business sector in the United
States."[114]

A Loyola University Chicago study which suggested that impact a Wal-Mart store has on a
local business is correlated to its distance from that store. The leader of that study admits that
this factor is stronger in smaller towns and doesn't apply to more urban areas saying "It'd be
so tough to nail down what's up with Wal-Mart".[115] Another study found Wal-Mart's entry
into a new market has a profound impact on its retail competition. When a Wal-Mart opens in
a new market, median sales drop 40% at similar high-volume stores, 17% at supermarkets and
6% at drugstores, according to a June 2009 study by researchers at several universities and led
by the Tuck School of Business at Dartmouth College.[116]

For the concern of jobs, a study commissioned by Wal-Mart with consulting firm Global
Insight, found that its stores' presence saves working families more than US$2,500 per year,
while creating more than 210,000 jobs in the U.S.[117][118] Alternately the Economic Policy
Institute estimates that 196,000 jobs were lost between 2001–2006,[119] and 68% of jobs lost
were manufacturing jobs. Another study by Global Insight has found that Wal-Mart's growth
between 1985 and 2004 resulted in food-at-home prices that were 9.1% lower and overall
prices (as measured by the Consumer Price Index) that were 3.1% lower than they would
otherwise have been.[120]

Another study at the University of Missouri found that a new store increases net retail
employment in the county by 100 jobs in the short term, half of which disappear over five
years as other retail establishments close.[121]

Studies of Wal-Mart show consumers benefit from lower costs. A 2005 Washington Post
story reported that "Wal-Mart's discounting on food alone boosts the welfare of American
shoppers by at least $50 billion per year."[122] A study in 2005 at Massachusetts Institute of
Technology measured the effect on consumer welfare and found that the poorest segment of
the population benefits the most from the existence of discount retailers.[123] A 2004 paper by
two professors at Pennsylvania State University found that U.S. counties with Wal-Mart
stores suffered increased poverty compared with counties without Wal-Marts.[124] They
hypothesized, to explain their results: This could be due to the displacement of workers from
higher-paid jobs in the retailers customers no longer choose to patronize, Wal-Mart providing
less local charity than the replaced businesses, or a shrinking pool of local leadership and
reduced social capital due to a reduced number of local independent businesses.[124] Dr Raj
Patel, author of Stuffed and Starved: Markets, Power and the Hidden Battle for the World
Food System, said in a lecture at the University of Melbourne on 18 September 2007, that a
study in Nebraska looked at two different Wal-Marts, the first of which had just arrived and
“was in the process of driving everyone else out of business but, to do that, they cut their
prices to the bone, very, very low prices”. In the other Wal-Mart, “they had successfully
destroyed the local economy, there was a sort of economic crater with Wal-Mart in the
middle; and, in that community, the prices were 17 per cent higher”.[125]

Employee and labor relations

See also: Criticism of Wal-Mart

A protest in Utah against Wal-Mart

Labor unions, Christian organizations,[126][127] and environmental groups[128] have criticized

Wal-Mart for its policies and/or business practices. In particular, several labor unions blame
Wal-Mart workers' unwillingness to join their organizations on the company's anti-union
stance. Others disapprove of the corporation's extensive foreign product sourcing, treatment
of employees and product suppliers, environmental practices, and use of public subsidies, and
the impact of stores on the local economies of towns in which they operate.[129][130][131]

In 2005, two national campaigns to criticize Wal-Mart were launched: the (United Food and
Commercial Workers) launched Wake Up Wal-Mart and The Center for Community and
Corporate Ethics launched Wal-Mart Watch.[132][133] By the end of 2005, Wal-Mart launched
Working Families for Wal-Mart, an operation managed by Wal-Mart to tell the company's
side of the story. Additional efforts to counter criticism included a PR campaign in 2005,
managed through its PR website walmartfacts.com,[134] as well as several television
commercials. The company retained the PR firm Edelman to respond to negative media
attention,[135] and started interacting directly with bloggers by sending them news, suggesting
topics for postings, and sometimes inviting them to visit its corporate headquarters.[136]
Similarly, in 2010, several of Wal-Mart's opponents have hired The Saint Consulting Group
to support grass-roots campaigns against Wal-Mart. The most notable of these include grocery
chains such as Safeway Inc., SuperValu, and Ahold, concerned that the presence of Wal-Mart
will add more competition to their operations.[137]

In the past, Wal-mart has been accused of locking night-shift workers in at night,[138] paying
employees below minimum wage, and exposing employees to health hazards.[70] Wal-Mart's
own "Standards for Suppliers" reports document extensive problems of this kind among the
company's "directly-sourced" factories.[139] Full-time Wal-Mart employees earn an average of
$10.78 per hour, but critics point out that the starting pay can be far lower — placing some
employees with children below the poverty line — and that payrates do not rise as quickly as
with unionized companies.[140] Others decry low levels of health coverage or overpriced health
insurance, though the company reports that it offers rates as low as $5 per month in some
areas ($9 per month nationwide) and that 92% of its associates are insured (though not
necessarily through Wal-Mart).[141] Other grievances regard poor working conditions,
unfavorable employer-employee relationships, and anti-union policies. Many suggest that
Wal-Mart's high annual turnover-rate of ~70% shows that workers are dissatisfied and
maltreated.[140]

In response, Jay Nordlinger of National Review argues that Wal-Mart is attacked simply
because it is a leader of the Fortune 500 list or the largest employer in America, and a "free-
market success story".[142] Penn & Teller devoted an episode of Bullshit! to an analysis of
Wal-Mart criticism as a social movement. They theorized that despite the noble rhetoric, the
real motivation of "Wal-Mart haters" was rooted in human psychology. They suggested that
hating Wal-Mart permits a person "to feel better about themselves" for three main reasons:
They "don't run a greedy international conglomerate", they aren't Wal-Mart workers, widely
considered "low-skilled, minimum wage drones", and they aren't Wal-Mart customers thought
of as "toothless, welfare-getting hillbillies".[143] Wal-Mart stores are unionized in every
country outside of North America.[144]

Wal-Mart has opposed the Employee Free Choice Act (EFCA), which would make it easier
for workers to unionize by removing the employer's ability to demand a secret ballot in union
elections, and which would require mandatory arbitration of labor disputes. In mid-2008, the
company required store managers and department heads to attend meetings at which
opposition to the EFCA was used as a fulcrum for criticism of Democratic candidates in the
elections for the United States Senate and the House of Representatives, as well as of the
presumptive Democratic Presidential nominee, Senator Barack Obama. At these meetings,
Wal-Mart human resources managers warned that Democratic victories might result in
passage of the EFCA and hence more unionization. At one meeting, a Wal-Mart customer
service supervisor from Missouri stated, "I am not telling you how to vote, but if the
Democrats win, this bill will pass and you won't have a vote on whether you want a union.[145]
A Wal-Mart spokesman, while acknowledging that the meetings were taking place
nationwide, said, "If anyone representing Wal-Mart gave the impression we were telling
associates how to vote, they were wrong and acting without approval."[145] Several labor-rights
groups including the AFL-CIO have asked the Federal Election Commission to investigate
whether Wal-Mart broke federal election rules by advocating against Democratic candidate
Barack Obama in meetings with employees.[146]

According to a Newsweek article, Wal-Mart, after years of fierce fighting, accepted organized
labor in China. Labor unions in China do not negotiate contracts, but rather they are an arm of
the state "to secure the social order" and provide funding to the Communist Party.[147]

Gender and sexual orientation

Wal-Mart is currently facing a gender discrimination lawsuit, Dukes v. Wal-Mart Stores, Inc.,
which alleges that female employees were discriminated against in matters regarding pay and
promotions. If the class action is certified, it would be the largest such lawsuit in history,
covering 1.5 million women according to the plaintiffs.[148] A December 2007 United States
Court of Appeals for the Ninth Circuit 2–1 ruling[149] affirming the class certification was
vacated by the court for en banc review;[150][151] in a 6–5 decision, the appeals court affirmed in
part and remanded in part the district court's order regarding class certification.[152] In
December 2010, the United States Supreme Court granted certiorari with regard to whether
the case may proceed as a class action.[153][154] The courts have not yet reached the merits of the
underlying dispute.[152]

This paragraph recently underwent a major revision or rewrite, and may need
further review. You can help Wikipedia by assisting in the revision.

According to a consultant hired by plaintiffs in a sex discrimination lawsuit, in 2001, Wal-

Mart's EEOC filings showed that female employees made up 65% of Wal-Mart's hourly paid
workforce, but only 33% of its management.[155][156] Just 35% of its store managers were
women, whereas 57% were at comparable retailers.[156] Wal-Mart says comparisons with other
retailers are unfair, because it classifies employees differently; if department managers were
included in the totals, women would make up 60% of the managerial ranks.[156] Others have
criticized the lawsuit as without basis in the law and as an abuse of the class action
mechanism.[157][158][159] In 2007, Wal-Mart was named by the National Association for Female
Executives as one of the top 35 companies for Executive Women.[160]

Wal-Mart's rating on the Human Rights Campaign's Corporate Equality Index, a measure of
how companies treat LGBT employees and customers, has fluctuated widely during the past
decade, from a low of 14% (2002) to 65% (2006). They were praised for expanding their
antidiscrimination policy protecting gay and lesbian employees,[161] as well as for a new
definition of "family" that included same-sex partners.[162][163] However, they have been
criticized in other areas, such as not renewing its membership in the National Gay and
Lesbian Chamber of Commerce, which is reflected in their 2008 rating of 40% (compared to
Target at 80% and Kmart at 100%).[164]

In January 2006, Wal-Mart announced that "diversity efforts include new groups of minority,
female and gay employees that meet at Wal-Mart headquarters in Bentonville to advise the
company on marketing and internal promotion. There are seven Business Resource Groups:
women, African-Americans, Hispanics, Asians, Native Americans, Gays and Lesbians, and a
disabled group."[165]

See also
Arkansas portal
Companies portal

Television and film

 Wal-Mart: The High Cost of Low Price – a 2005 documentary film by director Robert
Greenwald
 Why Wal-Mart Works; and Why That Drives Some People C-R-A-Z-Y – a 2005
rebuttal to the Greenwald documentary
 Something Wall-Mart This Way Comes – a 2004 episode of Comedy Central's South
Park

Other

 Wal-Mart camel – a bone fossil of a prehistoric camel found at a future Wal-Mart

store in Mesa, Arizona
 Wal-Mart First Tee Open at Pebble Beach – a golf tournament
 Walmarting – a neologism

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