Dave Ness
Sam Walton: Truth be Told
There is this picture of a man, a saint, “The Godfather.” He fathered the largest retailing corporation in the world, starting with a little “Five and Dime” store and creating a monster that’s seemingly consuming every bit of available space. Countless things can be said of a man who redefined what it is to be an American consumer. To other Wal-Mart associates or even those who shop there, Sam Walton is close to a god. “Saint Sam” was the first to look out for the “little guy.” He accepted the small no-name towns in rural America and moved in when no one else would. It can even be argued that Sam Walton and his creation have kept inflation at a minimum. The way Wal-Mart promotes him, what he’s done, and what he’s said could lead any innocent bystander to the conclusion that Sam Walton is a savior. If you do research, however, it’s also quite easy for Sam Walton to leave a bitter taste in one’s mouth. He wasn’t very forgiving, he wasn’t exactly generous, and he was a rather stingy individual. Because Wal-Mart is one of the most researched companies in the world, it’s easy to find some faults in a massive corporation. Likewise, it is easy to link that criticism directly to Sam Walton because he started it all. He may deserve a lot of that criticism and some may be misdirected. The question now is where Sam Walton truly stands; the pedestal or lying on the ground battered and broken? Is he an angel in disguise, or is he no more than a painting of God with bad intentions?
As a young man Sam Walton always remained busy by being involved with everything imaginable. He was well-liked by others, friendly and outgoing, and even was president of the student body his senior year. He was a three-sport athlete and was extremely competitive; as quarterback, he led his football team to a state championship. He also belonged to many school clubs, worked at a five and dime store and delivered newspapers (Ortega, 1998, p. 21). This hard work continued into his college days; “the joke on campus was that there wasn’t a club he wouldn’t join just to run for office” (Ortega, 1998, p. 21). He got his first taste of retailing as an associate at JC Penny’s department store; it was here he learned many tricks of the trade he later would apply at Wal-Mart. On September 1, 1945, Sam Walton took over his own Ben Franklin store in Newport, Arkansas. It was at his first store where he decided upon selling more items at a lower profit instead of focusing on more profit per item and accepting less items sold. This method of sales seems to stand out the most when looking at Wal-Mart today and how Sam Walton built his creation.
Researching Sam Walton is difficult because much of Wal-Mart’s lack of morals can be seen as a fault of Sam. For example, Wal-Mart has countless environmental issues that may not accurately reflect Sam because he is an avid hunter who enjoys spending time outdoors. However, many of the problems that Wal-Mart faces are a direct result of the “Sam Walton way.” Sam beamed with pride at the idea that Wal-Mart is creating and preserving jobs in the United States. This notion seems to contradict reality though. For instance, what happened to Pillowtex doesn’t reflect this bold assertion. Pillowtex was the largest manufacturer of linens in 1997; by 2000 the company was broke. This was a direct result of Wal-Mart’s beating the manufacturer into submission to obtain the lowest price. Sam’s grand scheme of lowering prices at all costs crushed an American manufacturer.
There are also several cases of how Wal-Mart is even causing the manufacturer to open plants in Mexico or China just to compete with rivals; this again destroys American jobs. Sam Walton’s claim of “Made in America” doesn’t seem to hold up in practice. That isn’t the first case of Walton’s claims not holding up; in his very first store he advertised “…only first class merchandise—‘No seconds or factory rejects’… (Ortega, 1998, p. 55). This was his way of attracting customers, and it worked well for him. However, because he was a struggling shopkeeper, he couldn’t necessarily get the best merchandise, and therefore low price took precedence over quality.
Sam Walton ran his entire life by two guiding principles: low possible price and the customer is number one. He seemingly devoted his entire existence to make sure these principles were engrained into everyone’s head. This is the point at which truth and perception really become hazy. Sam said customer satisfaction is “quality merchandise; the lowest possible prices; guaranteed satisfaction with what you buy; friendly, knowledgeable service… a pleasant shopping experience” (Walton with Huey, 1992, p. 221). Somehow some of this has been lost in translation; the low prices have always remained prominent but even they don’t always back up Wal-Mart’s, or Sam’s claim. The fact that Wal-Mart changed its slogan from “Always the low price, Always” to “Always low prices” because they weren’t always offering the lowest prices is one example. Or there is the way Wal-Mart baits customers, this also begs the question of what Wal-Mart’s true focus is. Wal-Mart will place a low quality item in plain sight at a very low price to entice the customer to enter that aisle and see the low prices on similar items of higher quality. When the customer decides on one item that is better quality and still low price, Wal-Mart wins. That item, though it seems to be at a steal of a price, probably wasn’t the lowest price in town. This is when profit becomes the motivating factor at Wal-Mart, not serving the customer.
Sam Walton, more on an individual level, doesn’t seem to be much of a saint either. At one point he said “Wal-Mart really is not, and should not be, in the charity business” (Ortega, 1998, p. 195). He finally was forced into creating the Wal-Mart Foundation by his wife in 1981 which gave $64,000 to charities, or about .1% of the corporation’s net income. The donations increased over the years; however, Wal-Mart remained at the bottom of all retail businesses. Sam Walton, again, retains his miserly lifestyle. The donations made seem to be more for publicity than the sincerity of a good deed. In fact, “Walton never hesitated to have Wal-Mart grab credit for its purported generosity—even if that meant shamelessly taking kudos for the donations of others” (Ortega, 1998, p. 195). Sam’s individual giving also was rather minute; in 1985 he gave $3.6 million for scholarships to Arkansas colleges and then upon further urging of his wife created the Walton foundation (Ortega, 1998, p. 196). For the wealthiest man in the United States at the time, that truly is pocket-change. To slightly overshadow Sam’s contributions, “Bill Gates, today’s pre-eminent philanthropist, has already handed over an unprecedented $31 billion to the Bill and Melinda Gates Foundation… ” (“Business” 2006). The only thing left to wonder is how one of the richest men of his time can be so entirely wrapped up in efficiency, profits, and greed.
Perhaps he wasn’t all bad though; many of his workers believed in him and trusted in him to take care of them, which he did. He sure didn’t show it through pay or benefits, but he did care. He appeared genuine; he would show up to stores, shake workers’ hands and try to remember their names. However, the good things Sam seem to be overshadowed by the bad. What Sam said and what he’s done aren’t lining up so well anymore. Wal-Mart’s board of directors and other positions of authority are known to share hotel rooms to cut down on costs. Sam Walton was known for driving a beat-up old pickup truck, even after making a fortune. Nevertheless, he owned several airplanes and would even fly his plane around to check on store progress. Examples like these make it difficult to not view him as a bit of a hypocrite. One thing is beginning to come clear though; Sam Walton is a true businessman. Through all the talk, tradition and stupid squigglies, the bottom line is profit. “Walton created a company and a corporate culture that mirrored his own nature… an implacable, driven, and manipulative business that uses cutthroat tactics while operating behind a disarmingly folksy facade” (Ortega, 1998, p. 370).
Many of the things Walton has done are certainly admirable, redefining retail, creating the world’s biggest retail giant, even redefining what it is to be an American Consumer. He accomplished many amazing feats and built everything from the bottom up. It may be difficult to view Sam Walton without the shadow of a Wal-Mart bias, but ultimately, Sam Walton was a businessman. It probably isn’t fair to compare him to Bill Gates or other prominent figures of today and say he was a very bad person. He’s human, so one must take the good with the bad. He certainly was no angel, but he was probably even farther from being the devil’s advocate.
References
The business of giving. The Economist Newspapers Ltd. (2006, February). Retrieved April 23, 2006 from the World Wide Web: http://web.lexis-nexis.com/universe/document?_m=61dfe9d83e64d3754ea94c5876a9aed5&_docnum=5&wchp=dGLbVzz-zSkVA&_md5=b05b82cb96dc97f1f8005646b2cd4b1c
Ortega, B. (1998). In Sam We Trust: The Untold Story of Sam Walton and How Wal-Mart is Devouring America. New York: Times.
Walton, S. M., with Hughey J. (1992). Sam Walton: Made in America. New York: Doubleday.
Sam Walton: Truth be Told
There is this picture of a man, a saint, “The Godfather.” He fathered the largest retailing corporation in the world, starting with a little “Five and Dime” store and creating a monster that’s seemingly consuming every bit of available space. Countless things can be said of a man who redefined what it is to be an American consumer. To other Wal-Mart associates or even those who shop there, Sam Walton is close to a god. “Saint Sam” was the first to look out for the “little guy.” He accepted the small no-name towns in rural America and moved in when no one else would. It can even be argued that Sam Walton and his creation have kept inflation at a minimum. The way Wal-Mart promotes him, what he’s done, and what he’s said could lead any innocent bystander to the conclusion that Sam Walton is a savior. If you do research, however, it’s also quite easy for Sam Walton to leave a bitter taste in one’s mouth. He wasn’t very forgiving, he wasn’t exactly generous, and he was a rather stingy individual. Because Wal-Mart is one of the most researched companies in the world, it’s easy to find some faults in a massive corporation. Likewise, it is easy to link that criticism directly to Sam Walton because he started it all. He may deserve a lot of that criticism and some may be misdirected. The question now is where Sam Walton truly stands; the pedestal or lying on the ground battered and broken? Is he an angel in disguise, or is he no more than a painting of God with bad intentions?
As a young man Sam Walton always remained busy by being involved with everything imaginable. He was well-liked by others, friendly and outgoing, and even was president of the student body his senior year. He was a three-sport athlete and was extremely competitive; as quarterback, he led his football team to a state championship. He also belonged to many school clubs, worked at a five and dime store and delivered newspapers (Ortega, 1998, p. 21). This hard work continued into his college days; “the joke on campus was that there wasn’t a club he wouldn’t join just to run for office” (Ortega, 1998, p. 21). He got his first taste of retailing as an associate at JC Penny’s department store; it was here he learned many tricks of the trade he later would apply at Wal-Mart. On September 1, 1945, Sam Walton took over his own Ben Franklin store in Newport, Arkansas. It was at his first store where he decided upon selling more items at a lower profit instead of focusing on more profit per item and accepting less items sold. This method of sales seems to stand out the most when looking at Wal-Mart today and how Sam Walton built his creation.
Researching Sam Walton is difficult because much of Wal-Mart’s lack of morals can be seen as a fault of Sam. For example, Wal-Mart has countless environmental issues that may not accurately reflect Sam because he is an avid hunter who enjoys spending time outdoors. However, many of the problems that Wal-Mart faces are a direct result of the “Sam Walton way.” Sam beamed with pride at the idea that Wal-Mart is creating and preserving jobs in the United States. This notion seems to contradict reality though. For instance, what happened to Pillowtex doesn’t reflect this bold assertion. Pillowtex was the largest manufacturer of linens in 1997; by 2000 the company was broke. This was a direct result of Wal-Mart’s beating the manufacturer into submission to obtain the lowest price. Sam’s grand scheme of lowering prices at all costs crushed an American manufacturer.
There are also several cases of how Wal-Mart is even causing the manufacturer to open plants in Mexico or China just to compete with rivals; this again destroys American jobs. Sam Walton’s claim of “Made in America” doesn’t seem to hold up in practice. That isn’t the first case of Walton’s claims not holding up; in his very first store he advertised “…only first class merchandise—‘No seconds or factory rejects’… (Ortega, 1998, p. 55). This was his way of attracting customers, and it worked well for him. However, because he was a struggling shopkeeper, he couldn’t necessarily get the best merchandise, and therefore low price took precedence over quality.
Sam Walton ran his entire life by two guiding principles: low possible price and the customer is number one. He seemingly devoted his entire existence to make sure these principles were engrained into everyone’s head. This is the point at which truth and perception really become hazy. Sam said customer satisfaction is “quality merchandise; the lowest possible prices; guaranteed satisfaction with what you buy; friendly, knowledgeable service… a pleasant shopping experience” (Walton with Huey, 1992, p. 221). Somehow some of this has been lost in translation; the low prices have always remained prominent but even they don’t always back up Wal-Mart’s, or Sam’s claim. The fact that Wal-Mart changed its slogan from “Always the low price, Always” to “Always low prices” because they weren’t always offering the lowest prices is one example. Or there is the way Wal-Mart baits customers, this also begs the question of what Wal-Mart’s true focus is. Wal-Mart will place a low quality item in plain sight at a very low price to entice the customer to enter that aisle and see the low prices on similar items of higher quality. When the customer decides on one item that is better quality and still low price, Wal-Mart wins. That item, though it seems to be at a steal of a price, probably wasn’t the lowest price in town. This is when profit becomes the motivating factor at Wal-Mart, not serving the customer.
Sam Walton, more on an individual level, doesn’t seem to be much of a saint either. At one point he said “Wal-Mart really is not, and should not be, in the charity business” (Ortega, 1998, p. 195). He finally was forced into creating the Wal-Mart Foundation by his wife in 1981 which gave $64,000 to charities, or about .1% of the corporation’s net income. The donations increased over the years; however, Wal-Mart remained at the bottom of all retail businesses. Sam Walton, again, retains his miserly lifestyle. The donations made seem to be more for publicity than the sincerity of a good deed. In fact, “Walton never hesitated to have Wal-Mart grab credit for its purported generosity—even if that meant shamelessly taking kudos for the donations of others” (Ortega, 1998, p. 195). Sam’s individual giving also was rather minute; in 1985 he gave $3.6 million for scholarships to Arkansas colleges and then upon further urging of his wife created the Walton foundation (Ortega, 1998, p. 196). For the wealthiest man in the United States at the time, that truly is pocket-change. To slightly overshadow Sam’s contributions, “Bill Gates, today’s pre-eminent philanthropist, has already handed over an unprecedented $31 billion to the Bill and Melinda Gates Foundation… ” (“Business” 2006). The only thing left to wonder is how one of the richest men of his time can be so entirely wrapped up in efficiency, profits, and greed.
Perhaps he wasn’t all bad though; many of his workers believed in him and trusted in him to take care of them, which he did. He sure didn’t show it through pay or benefits, but he did care. He appeared genuine; he would show up to stores, shake workers’ hands and try to remember their names. However, the good things Sam seem to be overshadowed by the bad. What Sam said and what he’s done aren’t lining up so well anymore. Wal-Mart’s board of directors and other positions of authority are known to share hotel rooms to cut down on costs. Sam Walton was known for driving a beat-up old pickup truck, even after making a fortune. Nevertheless, he owned several airplanes and would even fly his plane around to check on store progress. Examples like these make it difficult to not view him as a bit of a hypocrite. One thing is beginning to come clear though; Sam Walton is a true businessman. Through all the talk, tradition and stupid squigglies, the bottom line is profit. “Walton created a company and a corporate culture that mirrored his own nature… an implacable, driven, and manipulative business that uses cutthroat tactics while operating behind a disarmingly folksy facade” (Ortega, 1998, p. 370).
Many of the things Walton has done are certainly admirable, redefining retail, creating the world’s biggest retail giant, even redefining what it is to be an American Consumer. He accomplished many amazing feats and built everything from the bottom up. It may be difficult to view Sam Walton without the shadow of a Wal-Mart bias, but ultimately, Sam Walton was a businessman. It probably isn’t fair to compare him to Bill Gates or other prominent figures of today and say he was a very bad person. He’s human, so one must take the good with the bad. He certainly was no angel, but he was probably even farther from being the devil’s advocate.
References
The business of giving. The Economist Newspapers Ltd. (2006, February). Retrieved April 23, 2006 from the World Wide Web: http://web.lexis-nexis.com/universe/document?_m=61dfe9d83e64d3754ea94c5876a9aed5&_docnum=5&wchp=dGLbVzz-zSkVA&_md5=b05b82cb96dc97f1f8005646b2cd4b1c
Ortega, B. (1998). In Sam We Trust: The Untold Story of Sam Walton and How Wal-Mart is Devouring America. New York: Times.
Walton, S. M., with Hughey J. (1992). Sam Walton: Made in America. New York: Doubleday.
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12:41 PM
