INTRODUCTION

It was my pleasure to be invited to participate in Student Achievement Day at Bemidji State University in April of 2006. In particular I was pleased to be a part of the symposium on Wal-Mart, conducted by students of Honors 1105, entitled "Wal-Mart: It’s Powers, Influence and Values."
Twenty-five years ago, not many academics paid attention to Wal-Mart as it was a relatively small Southern company operating in small towns in the South and Midwest. Occasionally one would read in the popular press about Sam Walton, the founder, or about Wal-Mart associates (employees) becoming millionaires through their stock purchase plans and the rapidly rising Wal-Mart stock prices. However, much has changed in the last 25 years. Wal-Mart has grown to become the largest retailer in the world and nearly the largest corporation in the world, in terms of revenues. This rapid growth has made Wal-Mart a target for many detractors and a subject for research among academics. Therefore, it is timely and appropriate that Professors Nielson and Mengelkoch chose to develop an honors course for freshmen for the purpose of conducting research on Wal-Mart.
Students in the class made oral presentations of their findings on Student Achievement Day and then turned in written accounts which can be found after this introduction. I was impressed by the professionalism shown by the students both in their oral and written presentations. Students chose a wide variety of topics, many of which would normally be found in trade publications, not in the popular press. A partial listing of the topics covered include: Wal-Mart’s customer service, Wal-Mart’s impact on the music industry, Wal-Mart’s treatment of women employees, Wal-Mart’s relationship with China with regard to procurement and establishing retail stores. Other topics were Wal-Mart’s alleged use of child labor, Wal-Mart’s charitable giving, Wal-Mart’s recycling operations, Wal-Mart’s compliance with the Clean Water Act, Wal-Mart’s use of technology such as radio frequency Identification (RFID), Wal-Mart’s relations with unions, Wal-Mart’s advertising strategies and Wal-Mart’s procedures for choosing international vendors.
It appeared that most students approached their research with an open mind, as contrasted to many of their elders who take a position on Wal-Mart and set out to prove it regardless of facts. Most of the students did extensive research, using several references. I was also impressed with the composure exhibited by the students during their oral presentations. At that age, I would have been "shaking in my boots." A couple of students even conducted original research by constructing and administering surveys, a very ambitious undertaking for undergraduates at any level.
It is quite refreshing to see such bright young students engaged in applying classroom instruction to answering real-world questions. Many people believe that undergraduate curricula are becoming more and more theoretical. In recent years, many employers have complained to administrators of colleges and universities that undergraduate education has become too esoteric and consequently ill prepares students to enter the workforce. By concentrating on student achievement and by integrating real-world problem solving into the undergraduate curriculum, Bemidji State University may be leading the way in better preparing graduates to enter the workforce.
Professors Nielson and Mengelkoch have demonstrated a rare ability to determine the needs of students and to develop a course to meet some of these needs. They engaged the students in a controversial subject area and provided the leadership to inspire the class to look at many sides of the Wal-Mart phenomenon. By providing an opportunity for the class to determine a problem, to conduct research on it and then to report findings both orally and in writing, these two professors have given students an experience that puts them ahead of many of their peers and makes them very attractive to prospective employers.
In conclusion, the following compendium of research is an excellent primer to the many sides of Wal-Mart. I commend readers to take the time to read each of these reports. I believe they provide an insight into many aspects of the world’s largest retailer. Perhaps the best part of these research papers is that none of the authors had an "axe to grind." They researched the topic to the best of their ability and presented their findings without ulterior motives.

Kenneth E. Stone
Professor Emeritus of Economics
Iowa State University

Gas Pumper to CEO: A Brief Look at H. Lee Scott and His Wal-Mart Career

Erika MacKinnon

Harold Lee Scott is the current CEO and president of Wal-Mart, the largest Fortune 500 Company in the world. His ingenuity and tenacity for business success has brought him from the assistant director of transportation of a distribution center for Wal-Mart to the position that he currently holds. How was he able to move so quickly up the corporate ladder with such success? His tough work ethic, risk-taking success and a little bit of luck ultimately helped Scott thrive in his career.

Scott was born in 1950 in southern Kansas to a family of lower middle class. His mother worked as a music teacher at the local elementary school and his father managed a local gas station, where Scott worked part time during high school(Reference for Business, March 25, 2006). After graduating high school, Scott attended college at Pittsburg State University and completed a degree in business administration in 1971.

After completing college, Scott was hired at Yellow Freight System, a large trucking company based in Kansas. It was here where Scott had his first encounter with Wal-Mart as a corporation. Wal-Mart owed the company a bill in the amount of $7,000 and was refusing to pay. During the course of the payment disagreement, Scott met the future CEO, David Glass and was offered a job in Wal-Mart as head of one of their new distribution centers. Scott point blank refused at the time saying, “I’m not going to leave the fastest-growing trucking company in America to go to work for a company that can’t pay a $7,000 bill”(Business Week, November 15, 1999). However, several years later, Scott changed his mind and started working for Wal-Mart.

In 1977, Scott was hired as a terminal manager of the transportation department in Springdale, Arkansas. In 1979, Scott was promoted to assistant director of transportation. It was during these first years when Scott learned a lesson about Wal-Mart’s “open-door policy” after the drivers he was in charge of complained to Sam Walton about Scott’s letters that threatened to fire anyone who broke the rules. Several of the drivers had gone to Walton asking that Scott be fired for his rudeness. Instead, “Walton talked to Scott and ordered him to listen to the drivers’ complaints [….] and then told Scott that he was to shake the hands of all the drivers who came to see him and thank them for using the company’s ‘open-door’ policy to talk to management”(Reference for Business, March 25, 2006)

During the next 16 years, Scott was promoted through the corporate ladder and held the following positions: director of transportation, vice president of transportation, vice president of distribution, and senior vice president of logistics. While working in the various positions of the transportation department, Scott “was pivotal in developing the automated distribution system that link[s] suppliers and stores by computer”(Reference for Business, March 25, 2006). This system is one of the key elements that allows Wal-Mart to be so effective with its transportation and helps keep costs even lower for its customers.

In 1995, Scott was promoted, once again, this time to vice president of merchandising. This was one area, however, that Scott had little experience and had to take many risks in order for success. He managed to increase sales for the company, cut even more costs, implement better training programs, push for improved store design and help develop ways to increase store traffic during the slower days of the week despite being the ‘under-dog’ in merchandising knowledge.

Also during this time, Wal-Mart was the focus of public scrutiny after details of its sweatshop labor practices and the Kathie Lee Gifford clothing line had come to light. It was decided by a panel of directors that Scott would become the company spokesman and handle the media. Scott managed to “defuse what might have been a public relations and economic disaster for Wal-Mart” with his smooth talking skills and promising that Wal-Mart would “keep a closer eye on its foreign factories.”(Reference for Business, March 25, 2006) Scott would use the same smooth-talking tactics when he became CEO to deflect criticism and scorn.

In 1998, Scott was promoted to president and CEO of the Wal-Mart Stores division, “overseeing the merchandising and operations of the more that 2300 Wal-Mart stores.”(Meet Our People, Board of Directors, 2004) A year later, he was promoted to vice chairman and COO (chief operating officer) of Wal-Mart. In an effort to keep in touch with the core of the company, Scott visited a Wal-Mart store at least once a week to talk with managers and employees and make suggestions about how to run the store more effieciently.

Finally, in 2000, Scott was promoted for the last time to president and CEO of Wal-Mart at the age of 50. Following the Wal-Mart tradition, he tried to maintain a low profile and set a tone for employees by discouraging them from “indulging in status symbols” and “signs of ostentatious wealth”(Reference for Business, March 25, 2006) by driving a 1999 Volkswagen Bug to work. He gained reputation with the media as being a ‘nice guy’ and being more than willing to admit when the company made mistakes. Of course, he was always there to defend Wal-Mart against accusations of unfair pay, poor benefits and a variety of other issues.

As expected of one of the largest companies in the world, being CEO did not come without its share of difficulties. Scott has had to face a bombardment of criticism in almost every possible area ranging from wages to health care, foreign labor to not having enough American-made products and expansion to environmental violations. While in the early years of his CEO career Scott used tactics to brush off or attempt to hide Wal-Mart’s problems, he eventually had to come out deal with the issues that were becoming more and more obvious to the public. So far, Scott has managed to maintain a delicate balance with the public and the press with lawsuits and fines coming in from all directions.

One of the main areas that Wal-Mart is always taking a hit on is issues of health care benefits and wages for employees. Scott is always on the ready to say that “84 percent of Wal-Mart’s employees currently have health insurance”(Wal-Mart Facts, 2003) and that the average full-time worker makes around $10.00 an hour. In a response to critics who say that Wal-Mart should “take the role of General Motors after WWII and help create middle-class jobs that pay well”, Scott says” Retail doesn’t play that role” (Springfield Morning News April 6, 2005) and in all reality, that’s true. Scott has remarked that people want to work for Wal-Mart because their old jobs “didn’t have any benefits…and didn’t provide the right job at the right time in their lives...Wal-Mart offers this and gives them a step up on the economic ladder.” Scott also feels that Wal-Mart is there for the customer and giving higher wages to Wal-Mart’s 1.6 million employees would increase costs and make Wal-Mart less of a competitor in its own market of cheap products.

In addition to having to constantly defend Wal-Mart as a company, Scott has taken recent personal criticism with the leak of what was supposed to be an employee only website titled “Lee’s Garage.” Named after his father’s gas station, Lee’s Garage was a series of documents of “internal electronic correspondence between Scott and his managers”(Wal-Mart Watch, February 2005) that reveal a less friendly side of Scott and his snide remarks to manager’s questions. In a response to a manager who wanted to know why Wal-Mart did not offer higher health benefits, Scott suggested that the “store manager is disloyal and should consider quitting”( New York Times, February 17, 2006). In entries throughout the documents, Scott apparently shows a side of frustration, defensiveness and crankiness that is normally hidden from the press. Even with the release of these documents, Scott has maintained a relatively good face with the public and continues to defend the company.

Of course, being one of the largest companies in the world isn’t all bad either. Scott and Wal-Mart are able to influence others to change the way they operate for the good and benefit of more people. For example, Scott said in a recent statement that Wal-Mart would be “rewarding environment-friendly suppliers” and that Wal-Mart would take steps to “curb its energy use.” Another bold statement that Scott made was that he wants to turn “Wal-Mart into a company that runs on 100 percent renewable energy and produces zero waste”(GreenBiz News, April 25, 2006). However, after receiving the largest environmental violation fine ever, it’s easy to see why critics are so skeptical of Scott’s promises for the company. Scott, however, remains steadfast in his belief that Wal-Mart can lead a change towards more sustainable usage and growth and has already implemented a program that will eliminate the need for 230 cargo-ship containers by reducing the packaging on just 16 different toys.

In addition to changing how the stores themselves are run, he also plans to save more fuel by shipping more items on a single truck. These changes not only benefit the environment and save Wal-Mart a few dollars, but they save the customer even more because overhead costs are reduced. Scott is also pushing for the construction of more ‘eco-friendly’ stores that use solar power and left over fuel sources like used motor oil and fat used to fry chickens. Scott hopes that “Wal-Mart, with its massive market size, can make a real difference [in the environment]”(Business Week, September 22, 2005)

Overall, Scott has been a huge benefit for Wal-Mart with his knowledge, experience and dedication to improve the company. While he admits that “Wal-Mart isn’t perfect,” he also says that Wal-Mart has the ability for “look at those things were we’re wrong and fix ourselves”(Springfield Morning News, April 6, 2005). Being the largest and probably the most influential company in history comes with many responsibilities to set standards and keep a high set of values, at Scott plans to do just that while watching Wal-Mart expand and continue to grow.

Resources

1.) Bianco A., March 22, 2006, The Wal-Mart Way. Retrieved April 25, 2006 from http://sfreporter.com/articles/publish/cover-032206-wal-mart.php

2.) Berner, R., September 22, 2005, Can Wal-Mart Wear a White Hat? For Business Week. Retrieved on May 9, 2006 from http://www.businessweek.com/bwdaily/dnflash/sep2005/nf20050922_6448_db01 6.htm

3.) French, A., April 6, 2005, Wal-Mart Speaks Up At Media Conference, for Springfield Morning News. Retrieved on April 25, 2006 from http://www.laane.org/pressroom/stories/walmart/050406morningNews.html

4.) Grant, L., November 10, 2003, Retail Giant Wal-Mart Faces Challenges on Many Fronts. For USA Today. Retrieved on April 25, 2006 from http://www.usatoday.com/money/industries/retail/2003-11-10-walmart_x.htm

5.) Griscom Little, A., April 12, 2006, Don't Discount Him: An Interview with Wal- Mart CEO H. Lee Scott. Retrieved on April 24, 2006 from http://www.greenbiz.com/news/reviews_third.cfm?NewsID=30891

6.) Joyce, A. and White, B., October 29, 2005, Wal-Mart Pushes to Soften Its Image for The Washington Post. Retrieved on April 23, 2006 from http://www.washingtonpost.com/wpdyn/content/article/2005/10/28/AR20051028 02079.html

7.) H. Lee Scott Jr., for Reference for Business. Retrieved on April 22, 2006 from http://www.referenceforbusiness.com/biography/S-Z/Scott-H-Lee-Jr-1950.html

8.) Lee’s Garage Needs a Tune Up, for Wal-Mart Watch. Retrieved May 9, 2006 from http://walmartwatch.com/blog/archives/lees_garage_needs_a_tune_up/

9.) Wal-Mart Facts, Meet Our People: Directors. Retrieved on April 24, 2006 from http://www.walmartfacts.com/newsdesk/meet-our people.aspx?CategoryID=105&strShowHide=True#a229

Brian Adkins
Honors 1105
Research Paper
May 8, 2006
How Does Wal-Mart Choose Its International Sites?

As Wal-Mart continues to grow, it is inevitable that it will enter new countries; by examining the countries Wal-Mart has already entered it is possible to estimate what the corporation wants in a country. Unfortunately, Wal-Mart has given out very few clues to this topic, so any conclusions must come from the examination of the countries that Wal-Mart currently occupies. There are many things that could have been examined about Wal-Mart’s host countries, but to draw as accurate conclusions as possible this research was centered on a few important topics. The first area of interest was the economic strength of the countries; this was measured in the sheer size of the Gross Domestic Product. Building on economic strength, the next area of research was the rate of economic growth. Another important area of study was the well-being of the population in these countries; this was determined by comparing literacy rates, which correlate to education; unemployment, which should correspond to the ability of people to provide for their families; and life expectancy, which would indicate the living conditions in the individual countries. Although there were no official statements concerning how Wal-Mart chooses its countries, there was one area which provided statements from Wal-Mart officials and a look into the current selection of a country by Wal-Mart. This area was the recent events in India where Wal-Mart has been expressing strong interest. It is interesting that not all of Wal-Mart’s choices in countries have worked out; in Germany, Wal-Mart has had almost nothing but trouble. Although this research was begun with very specific hypotheses about what Wal-Mart would prefer, these hypotheses turned out to be incorrect much of the time.
A brief note before the research is presented. Many times this paper will refer to “Wal-Mart owned stores”; this is for an important reason. Although Wal-Mart has locations in 16 countries; including: Argentina, Brazil, Canada, China, Costa Rica, El Salvador, Germany, Guatemala, Honduras, Japan, Korea, Mexico, Nicaragua, Puerto Rico, United Kingdom, and the United States; it would be improper to simply refer to Wal-Mart stores because in many countries there are no Wal-Marts as there are in the United States (“Data Sheet,” 2006). In some countries Wal-Mart does not build Wal-Marts outright; instead the corporation purchases existing retail chains in a country and expands from there. An example of this is Germany, where Wal-Mart purchased two local chains, Wertkauf and Interspar (“How Big,” 2004). This may be to reduce the culture shock of a large American corporation invading a new country.
The size of a country’s economy is something that most people would consider important to where a corporation decides to spread. My initial hypothesis was that Wal-Mart would prefer countries that did not have large economies, excluding the United States because this is where the corporation was founded. This hypothesis was founded on the belief that Wal-Mart sells primarily to the poorest of the poor, and it seemed logical that countries with weak economies would have a surplus of poor citizens. As it turns out, however, Wal-Mart has actually shown a tendency to prefer countries with exceptionally large economies. Of the 16 countries which currently contain Wal-Mart owned stores, 10 have economies ranked in the top 25 in the world (Central Intelligence Agency [CIA], 2006). This may be because no matter how large an economy is, there will always be a lower class that cannot afford to spend a lot of money, and by entering these countries Wal-Mart is selling to a lower class that has more money than the lower classes of countries with weak economies.
The next area of study was the rate of economic growth in the countries containing Wal-Mart owned stores. I did not expect countries with Wal-Mart owned stores to have economies growing at a fast rate; this hypothesis turned out to be true. Fourteen out of the 16 countries with Wal-Mart stores have economies growing below the world average of 4.3%, the only countries with fast growing economies being Argentina at 8.2% and China at 9.2% (CIA, 2006). One possible reason why Wal-Mart seems to prefer slow growing economies may be that it wants to keep a stable customer base and if the economy was growing rapidly that might result in a shrinking lower class.
The next subject of interest, after the economies of the countries, was the well-being of the populations. Measuring the well being of the populations amounted to comparing unemployment rates, literacy, and life expectancy. Each of these areas corresponds to something that many people would relate to the well-being of a population. Unemployment rates correspond to the ability of people to provide for their families; high unemployment would imply that many of the people are having a hard time making ends meet, while low unemployment would mean that most people are at least putting food on the table. Literacy is related to the quality of education in a country; low literacy would mean many people aren’t receiving an education while high literacy would indicate the exact opposite. Life expectancy is what seemed to be a good indicator of the quality of life; in countries where life expectancy is low the population would most likely lead a harder life with more hazards than countries with high life expectancies. As it turns out, the quality of life in the countries with Wal-Mart owned stores is remarkably good. All but four countries had literacy rates above the world average, the only ones below world average being El Salvador at 80.2%, Guatemala at 70.6%, Honduras at 76.2%, and Nicaragua at 67.5%. The world unemployment is somewhere between 4% and 12%. Overall unemployment in countries with Wal-Marts was low, only Nicaragua and China reported unemployment rates above this average, most had rates at the low end of the range. However, a few of the countries reported substantial underemployment (Mexico 25%, China, El Salvador). The life expectancy of all the countries was above average; over half had life expectancies well above average, over 10 years above the world average (CIA, 2006). These results seem to show that Wal-Mart isn’t preying solely on the poor and defenseless as is commonly believed.
There are no official statements from Wal-Mart regarding how the corporation chooses its international sites. Luckily, there have been recent events involving Wal-Mart in India that have provided a few statements made by Wal-Mart officials. By looking at the recent events in India I was able to conclude that a key element of what Wal-Mart wants is a large retail market to enter in each country. India is the fourth largest retail market in the world, and it is not alone in this area (Bhatnagar, 2006 April 4). Just a few counties with large retail markets that contain Wal-Mart owned stores are the United States, Japan, and Germany (“How Big,” 2004). The fact that Wal-Mart has expressed interest in India’s fast growing economy seems to conflicts with the previous conclusion that Wal-Mart prefers slow growing economies; however, even if you factor in India, the majority of countries still have slow growing economies.
Although it would make sense that Wal-Mart would not enter a country unless they were absolutely certain it could succeed in that country’s market, it is interesting that not all of Wal-Mart’s choices have worked out. In 1997, Wal-Mart entered the German market and has nothing but trouble since then. Due to things like price controls, rigid labor laws, and tough zoning regulations, Wal-Mart has lost money consistently every year since its entry into Germany (“How Big,” 2004).
Wal-Mart will continue to grow well into the future and, in doing so, it will inevitably enter many new countries. The research laid out in this report is by no means a sure way of predicting which countries Wal-Mart will expand in, but by the analysis of the past choices the corporation has made it will be possible to have an idea of what to expect. Wal-Mart is often thought of as an evil corporation that crushes it competition, but as this paper has shown, Wal-Mart tends to enter countries with strong economies and large retail markets which has opened the corporation up to much stronger competition than it would have faced if it had entered countries with small economies and retail markets. Also, by entering these stronger countries, Wal-Mart is entering customer bases that, compared to other parts of the world, are much better off than the stereotypical Wal-Mart customer which is generally the poor bottom rung of society. Wal-Mart has provided very few clues to how it chooses its international sites; fortunately, by analyzing recent events some valuable information was discovered. It would make sense that a huge corporation like Wal-Mart would put considerable time and effort into choosing its locations, but like all other worldly things, Wal-Mart has proven not to be infallible. Despite its best efforts Wal-Mart has continually lost money at its German sites. Although it is impossible to predict exactly where Wal-Mart will spread, the research has provided enough information to make a rough forecast. By looking at the information described in this paper it seems likely that Wal-Mart will continue to move into countries with large, slow growing economies where the population has a relatively good quality of life; some countries that fit these criteria are France and Italy, neither of which currently contain Wal-Mart owned stores. Wal-Mart is a large and complex entity, but by reviewing the past, it may be easier to forecast the future.



References

Data sheet: wal-mart international. (2006 March). Retrieved March 10, 2006, from http://walmartstores.com/GlobalWMStoresWeb/navigate.do?catg=371
Central Intelligence Agency. (2006) World factbook. Retrieved March 11, from http://www.cia.gov/cia/publications/factbook/index.html
Puerto Rico economy. (2006). Retrieved March 22, 2006, from http://welcome. topuertorico.org/economy.shtml
Extra spending showcases govt's determination to curb unemployment. (2005, March 5) Retrieved March 22, 2006, from http://news.xinhuanet.com/english/2005-03/05/content_2653319.htm
Underemploymant. (2006). Wikipedia. Retrieved March 30, 2006, from http://en.wikipedia.org/wiki/Underemployment
How big can it grow? (2004, April 4). The Economist. Retrieved March 30, 2006, from http://www.economist.com/printedition/displayStory.cfm?Story_ID=2593089
Bhatnagar, P. (2006, April 5) 4 ways to gat wal-mart back on track. CNNMoney.com. Retrieved April 5, 2006, from http://money.cnn.com/2006/04/05/news/ companies/walmart/
Bloomberg News and Wire reports, (2005. Nov. 3). Global business, South Florida Sun - Sentinel, 3.D. Retrieved March 30, 2006, from http://22816.bsulibproxy.pals.msus. edu/pqdweb?index=6&did=920828411&SrchMode=1&sid=2&Fmt=3&VInst=PROD&VType=PQD&RQT=309&VName=PQD&TS=1144533461&clientId=44369&cfc=1
Bhatnagar, P. (2006, April 4) Wal-mart’s dilemma in india. CNNMoney.com. Retrieved April 5, 2006, from http://money.cnn.com/2006/03/23/news/companies/ walmart_india/
What brings wal-mart to India? (n.d.) Retrieved March 30, 2006 from http://ibef.org/attachment/WhattoIndia.pdf

The Charitable Giving and
Philanthropic Efforts of Wal-Mart
Emily Carlson
Bemidji State University


Honors 1105: Influence, Power, and Values
Ms. Mengelkoch and Ms. Nielson
May 8, 2006
Abstract
Wal-Mart is the largest company in the world, and that has provoked a lot of discussion about it. I will attempt to look at Wal-Mart’s charitable givings. I will describe the different ways and programs in which they give. I will then compare their actual giving to their competitors’ giving and their corporation’s philosophies. During this analysis I will discover that Wal-Mart is lacking in its charitable giving department.















It can claim the titles of World’s Largest Corporation and Largest Corporate Sales Ever: Wal-Mart. With over 3500 stores within the United States and another 1500 stores globally, Wal-Mart has become a common term. It has been reported that 95% of all Americans live within twenty miles of a Wal-Mart store. Indeed, most Americans are familiar with what has come to be known as the “Wal-Mart Culture” and refer to Wal-Mart in their everyday speech. Considering it made $285,222,000,000 (that’s over a quarter of a trillion dollars) in sales in the 2005 fiscal year, the vast size of the Wal-Mart corporation has aroused many opinions and publications on the subject. It is probably the most analyzed company in the world: several documentaries have been produced regarding Wal-Mart; Liza Featherstone, Barbara Ehrenreich, and Bob Ortega have written popular books on issues concerning Wal-Mart; Iowa professor Ken Stone has studied and reported on the phenomena that is Wal-Mart; the Los Angeles Times produced an entire series of articles on Wal-Mart; and even Wal-Mart founder Sam Walton recorded his Wal-Mart story in book form. Obviously, many facets exist on the enormous Wal-Mart subject. While Wal-Mart has often been criticized for low wages, poor health care coverage, discrimination against women, child labor practices, substandard working conditions, and poor environmental practices, I propose to look at another side of the Wal-Mart story: its charitable giving.
First, let me define a few different aspects of corporate charitable giving. There are two main categories into which donations fall: cash donations and in-kind donations. Cash donations are the most obvious form of charitable giving. However, whenever products are given as a donation, that would be considered an in-kind donation. Often, medical companies will be large in-kind donators (Byrnes, 2005), but even retailers such as Wal-Mart can give in-kind donations.
Wal-Mart has set specific policies that guide their donations. First, they have listed what organizations are eligible and which are not eligible to receive their donations. To be eligible, the organization must be a 501(c)3 organization, a school, a religious group, a government agency, or part of a civic and veterans group (Grass roots). On the other hand, most things that are not eligible for a Wal-Mart donation are mostly those organizations that are promoting certain individuals, or film and video projects, programs outside Wal-Mart communities, and program advertising (Grass roots). Furthermore, vice president for corporate affairs for Wal-Mart Stores, Inc., Betsy Reithemeyer, commented in an interview that most donation “decisions are made at the local level,” and that stores are allocated certain budgets for donations, which are based on the store’s volume of sales (To give is, 2006). While certain programs are emphasized, each store manager is able to decide where to direct these funds in each community (To give is, 2006).
Not only has Wal-Mart set up certain guidelines for their charitable giving, they have also declared some of their own philosophies on the subject. Often, their giving is intended to have an impact on the local community of each store location. Their “community involvement program is based on the philosophy of operating globally and giving back locally” (Grass roots). Reithemeyer has said, “It has always been our goal to look for ways we can help improve the local communities where our Company associates and customers live” (Wal-Mart announces, 2004). “Wal-Mart Stores, Inc. believes each Wal-Mart store, SAM'S CLUB and distribution center has a responsibility to contribute to the well being of the local community” (Grass roots).
Wal-Mart will gladly give out information on its variety of charitable giving programs. In fact, they fund a website entirely devoted to telling the stories of people affected by Wal-
Mart’s generosity, www.walmartfoundation.org. A special “Wal-Mart Corporate Communications” release highlighted many of Wal-Mart’s Charitable Giving programs. For the fiscal year ending January 31, 2005, Wal-Mart’s charitable giving through these programs exceeded $170 million in cash donations (Wal-Mart announces, 2004). Wal-Mart has a number of programs through which their philanthropic practices often flow: Community Grants, Education, Military Support, Disaster Relief, Literacy, The World of Medicine, Child Safety and Missing Children, and Volunteerism Always Pays.
The Community Grants help “to support organizations large and small, from local schools, YMCA and other youth programs, fire departments, libraries and more” (Wal-Mart announces, 2004). “The Wal-Mart & SAM’S CLUB Foundation matched $61 million in grants for organizations in 3,500 communities” (Wal-Mart announces, 2004) through their Community Grants Program.
In the area of Education, Wal-Mart sponsors a Teacher of the Year Program and also awards scholarships for college students. Through their Wal-Mart Teacher of the Year Program, they gave over $4 million at the local, state, and national level (Wal-Mart announces, 2004). Also, $6 million was given out to high school seniors that would be attending college through the Sam Walton Community Scholarship program (Wal-Mart announces, 2004).
In an effort to support our troops, Wal-Mart has “provided 900,000 Communication Kits to servicemen and women that included free phone cards, writing paper and envelopes to help them stay in touch with loved ones” and has made kiosks available where messages can be sent
to servicemen and women (Wal-Mart announces, 2004). Also, Wal-Mart recently teamed up with Sesame Workshop by offering them a $1 million donation toward their efforts of helping
children with parents in the military to cope with any issues they may be struggling with (Special programs).
Furthermore, they provide services to assist with literacy efforts that include a literacy hotline. “The Company provided $6 million in support of 5,000 literacy programs in 2004” (Wal-Mart announces, 2004).
Through the Children’s Miracle Network, they provide funds for children’s hospital. Wal-Mart states that the Children’s Miracle Network “has always been one of [their] greatest benefactors” (Wal-Mart announces, 2004). While they gave $3.9 million to this cause, “grants and donations raised through Wal-Mart and SAM’S CLUB stores nationwide gave $30 million to CMN last year” (Wal-Mart announces, 2004).
They also help promote awareness of missing children through a partnership with the National Center for Missing and Exploited Children. Starting in 1996, Wal-Mart began posting pictures of missing children; they have also initiated Code Adam procedures in which store employees help to locate missing children within the store (Wal-Mart announces, 2004).
Additionally, through their Volunteerism Always Pays program, they encourage their associates to volunteer in the community and Wal-Mart will financially aid these programs. “Eligibility [in this program] is based on the number of hours volunteered at the organization each quarter and the organization’s non-profit status” (Volunteerism always pays). In 2004, associates volunteered 800,000 hours of their time and Wal-Mart paid out $5 million—an
average of $6.25 per hour which is just over Minnesota’s minimum wage (Wal-Mart announces, 2004).
Besides these specialized programs, Wal-Mart has also donated to well-known charities such as The American Red Cross, United Way, and the Salvation Army Red Kettle Program (Special programs).
Throughout the 2004 fiscal year, Wal-Mart made $188 million in total donations (Byrnes, 2005). They topped the list of companies making donations. Indeed, all of these accomplishments seem quite impressive. However, when you compare Wal-Mart’s charitable giving to their overall net income, they fall short of their competitors. In fact, they didn’t even make it to Business Week’s top ten list (Byrnes, 2005).
In nearly every aspect of business, Wal-Mart is at the top for excellence. They have embraced technological innovations to become superbly efficient. They demand low price from their suppliers and pass that on to their customers. They are the United States’ largest private employer. Every year, they take in the largest amount of net sales. As a point of perspective, Wal-Mart’s net sales for the year 2004 were over $285 billion whereas net sales of Target, one of Wal-Mart’s main competitors, for the same year were just over $45 billion. Looking at the companies’ net incomes, Wal-Mart’s net income was nearly three times that of Target’s. Wal-Mart made slightly over $9 billion and Target made over $3 billion. Yet, looking at the amount each company has provided in charitable donations, there is only a slight difference. According to Byrnes (2005), in 2004 Wal-Mart donated $188 million in cash donations whereas Target donated $107.8 million. When these numbers are compared to their net incomes, Target donated
roughly 3.6% while Wal-Mart donated only 2%—leaving them out of Business Week’s top ten ranking (Byrnes, 2005).
While Wal-Mart is certainly making strides in its philanthropic giving, it still falls short in comparison to its competitors and its own philanthropic goals. Unlike many more logistical aspects of business, Wal-Mart has not made satisfactory progress in the corporate citizenship aspect of business. In several of their publications, Wal-Mart boasts of their high donation amounts; it seems that they are only concerned with staying in the number one spot as largest cash donor. Yet, taken in perspective of their earnings, Wal-Mart’s donations fall short. Many companies have made it a priority to join the 5% club in their donations, but Wal-Mart remains less than half way to its competitors’ goal.
However, this shortfall has not seemed to be noticed by customers. “In the 2004 Cone Corporate Citizen Study, 80 percent of research respondents were able to name companies they associated with good corporate practices, and Wal-Mart was mentioned most often” (O’Brien). Obviously, they’ve been able to get good press out on their charitable giving—they’ve dedicated an entire website to it. However, some of Wal-Mart’s declarations can be a little misleading if you don’t pay close attention to them. For example, the aforementioned Children’s Miracle Network did receive a donation from Wal-Mart Stores, Inc. However, Wal-Mart goes on to report that $39 million were raised for the CMN through Wal-Mart stores (Wal-Mart announces, 2004). They did not necessarily donate this money themselves, but rather facilitated the donations. A similar review can be made about the Salvation Army’s Red Kettle Program.
Jonathan Birchall (2006), in a recent article on Wal-Mart’s charitable giving, noted that some of Wal-Mart’s new charitable programs and promotions come “amid its broad push to improve its corporate reputation.” “Companies boast about this good work for a good reason. At a time when corporate behavior is scrutinized by everyone from consumer bloggers to Sarbane-
Oxley-empowered regulators, philanthropic goodwill is a highly prized commodity” (Byrnes, 2005). Wal-Mart’s charitable giving is often a business move, not a conviction to give back to the communities to which they belong. Not only do they often get to write off many of their donations on tax forms, they are also using them as a way to boast their PR in hopes of attracting more clientele.
However, their recent giving has not necessarily come across so well to some of the charities to which they donate. Byrnes (2005) notes that “one downside for charities is that as companies become more focused on measuring the results of giving, they’re less willing to give unencumbered funding that helps pay ordinary operating expenses.” Also, in regards to donations to assist with “the national hunger crisis,” “hunger activists say Wal-Mart, now the largest U.S. food retailer, has been regarded as a laggard in the movement” (Birchall, 2006).
Furthermore, their change in policy over food donations has come as a disappointment to many local food shelves. They have decided to “no longer donate nearly-expired or expired food to local groups feeding the hungry,” but rather this food will simply be thrown away (Milbourn, 2006). While on the surface this may sound like a decent policy, many food bank directors view it as a waste of food since much of the food is still edible past sell-by dates. One director “said the breads, pies and cakes his group received from the Sam’s Club on El Camino Avenue helped round out the meals served to more than 900 families last year” (Milbourn, 2006).
While Wal-Mart has made attempts at being a good corporate citizen through their charitable donations, they have fallen short. Their major competitor, Target, along with several other companies are surpassing them in the percentage of donations they give. Many of their recent policies have been in discord with what the charity organizations would like to see. Plus,
it is often their associates who put in many of the volunteer hours, and they would probably do this even if Wal-Mart wasn’t funding the Volunteerism Always Pays program. If Wal-Mart wants to be a better corporate citizen, they need to make changes at the national, corporate level. They need to budget for more funds to be given out through donations. They have fallen behind many other corporations, and they have failed to fulfill their philosophies and missions for giving back to their communites.






References
Birchall, J. (2006, March 4). Wal-Mart seeks to raise its charity profile. The Financial Times Limited. Retrieved April 4, 2006, from the Lexis-Nexis database.
Byrnes, N. (2005). Smarter corporate giving. Business Week. Retrieved April 3, 2006, from the
Business Source Premier database.
Grass roots. (n.d.) Walmartfoundation.Org. Retrieved April 4, 2006, from http://
www.walmartfoundation.org/wmstore/goodworks/scripts/WhatWeFund.jsp?BV_SessionI D=@@@@0775452176.1144436879@@@@&BV_EngineID=ccceaddfdldmdjjcfkfcfkj dgoodglh.0&oid=-10267
Milbourn, T. (2006, January 6). Wal-Mart ends food donations to charity. Sacramento Bee. Retrieved April 4, 2006, from the Lexis-Nexis database.
Special programs. (n.d.) Walmartfoundation.Org. Retrieved April 4, 2006, from http://
www.walmartfoundation.org/wmstore/goodworks/scripts/index.jsp?BV_SessionID=@@ @@0775452176.1144436879@@@@&BV_EngineID=ccceaddfdldmdjjcfkfcfkjdgoodgl h.0
To give is better than to retail. (2006, February). Chain Store Age 82(2). Retrieved April 4, 2006, from the EBSCO MegaFILE database.





Charitable Giving 12
Wal-Mart Stores, Inc. announces total charitable giving for 2004 exceeded $170 million; touched 100,000 organizations: Largest corporate cash giving foundation in U.S. focuses on local giving, children and community efforts. (2004, February 15). Wal-Mart Corporate Communications. Retrieved March 22, 2006, from http://
www.walmartfacts.com/docs/969_fy2004foundationgivingrelease_416901112.pdf#searc h='walmart%27s%20charitable%20gving'
Volunteerism always pays: giving. helping. doing. (n.d.) Walmartfoundation.Org. Retrieved April 4, 2006, from http://www.walmartfoundation.org/wmstore/goodworks/scripts/
Community.jsp?BV_SessionID=@@@@0775452176.1144436879@@@@&BV_Engin eID=ccceaddfdldmdjjcfkfcfkjdgoodglh.0&oid=-10263&coid=-10290

Jessica Christiansen
HOPR 1105
5-8-06
(revised)

Recycling at Wal-Mart



Wal-Mart is the biggest corporation in the world (Hightower, 2002). So accordingly, they must produce a lot of waste. I wanted to know what they do with that waste and what impact this has on the environment. Recycling, by definition, is “the reuse of materials, either pre-consumer or post-consumer, that would ordinarily be considered waste” (Holder). Recycling is a very important thing for everyone, even big corporations, to be aware of as a way to maintain and improve the conditions of our environment. Recycling “helps lessen the amount of waste that goes into landfills, reduces the amount of toxic chemicals absorbed into the earth, and in some cases, significantly reduces manufacturing costs and energy consumption” (Holder). It is very important that corporations involve themselves with recycling; and, I found that Wal-Mart does do quite a bit. They have the Kid’s Recycling Challenge, and their newly invented program the “sandwich bale.” They also have two experimental “green stores,” and they try to donate some of their damaged goods and things like broken bags of dog food to places in the community that need them.
The “sandwich bale” is a new invention that Wal-Mart came up with to deal with the amount of plastic they were producing and sending to landfills. Wal-Mart teamed up with a company called Rocky Mountain Recycling in January of 2005. Wal-Mart was looking for a way to get rid of the apparel bags and stretch-wrap film. Jeff Ashby, the sales and marketing manager for Rocky Mountain Recycling, was told by people in his neighborhood that the amount of

plastic that was being thrown away at Wal-Mart was becoming a problem. Just about every garment that comes into the Wal-Mart store is inside its own individual plastic bag. These bags are used to help keep the clothing garments clean, and to help keep them from wrinkling. Ashby saw this as a potential problem, and also as an area for Wal-Mart to work on improving. To see just how extensive the problem was, they started to collect the plastic. Not long after they started collecting the plastic, they were running out of room to store it all. Someone asked why they couldn’t just put the plastic bags in the bailer to compact them and make it easier to store. This was the start of the plan that eventually evolved into the “sandwich bale.” Ashby and others from Rocky Mountain Recycling worked with Wal-Mart to come up with a way to make this compacted plastic work, and they invented the “sandwich bale.” They sandwiched 9 - 12 inches of plastic between 9 - 12 inches of cardboard to form the bale. (Orloski, 2005).
This “sandwich bale” is a new way for Wal-Mart stores to recycle this plastic. One of the biggest concerns when recycling plastic is the cost to transport and store it. John Magnuson, owner of the transfer station and recycling center here in Bemidji, explained the difficulties of recycling plastic. He said that the biggest problem with recycling plastic is that it takes a lot of plastic to make enough bales to make the cost to transport the plastic worth it (personal communication, April 29, 2006). He told us that if he were to collect soda bottles for a whole year, it would take up so much space in his storage facilities, and would only make one or two bales if he put it into the bailer (personal communication, April 29, 2006). Also, most of the markets for plastic are not always close to the recycling center, and because plastic is so lightweight, and there is not a lot of value placed on it, it doesn’t really support the cost of the transportation to distant markets (personal communication, April 29, 2006).

Another problem with recycling plastic is that there are so many different kinds of plastic. Magnuson used the example of a pop bottle. The cap is one type of plastic, the label is another kind of plastic, and the bottle itself is another kind of plastic. He also explained that there needs to be an available market for anything that you recycle. If no one wants to buy compacted plastic bales, or paper, or aluminum cans, it would not be cost effective enough to recycle them, because it would end up costing you more than it would if you were to just throw them away.
The reason that Wal-Mart’s “sandwich bale” looks so promising is because it addresses these issues of transportation, storage, and the mixtures of plastic. As the marketing and sales manager for Rocky Mountain Recycling, Ashby found a market for the plastic garment bags. He found that companies like Trex and Boise Cascade that make composite lumber were looking for plastic for large distribution centers. These companies love the mix of high and low density polyethylene (plastic) that has been collected by Wal-Mart. They say that it is the perfect mix of three grades of plastic that’s used for making the plastic lumber. (Orloski, 2005).
Ashby also found a way to address the issue of storing the plastic. They used Wal-Mart's beach ball displays. The 4’–x– 4’–x–10’ high wire or plastic tubed displays work really well. Ashby says that they have been very happy with the cleanliness of the bales. They had expected there to be food wrappers and pop cans and things like that, but says that the beach-ball bins are so open it’s really easy to see anything that doesn’t belong in them, so they work great. (Orloski, 2005).

The other problem of transportation has been taken care of with the “sandwich bale” also. In Orloski’s article, “Waste ‘sandwich’ helps Wal-Mart Recycle,” she explains that Rocky Mountain Recycling picks up the bales and separates the plastic from the cardboard, then ships each material to the appropriate customer. Don, the assistant manager here at the Bemidji Wal-Mart explained that the same truck that used to pick up the bales of cardboard come and pick up the new “sandwich bales” and do the same thing that Rocky Mountain Recycling does (personal communication, April 8, 2006). They separate the plastic from the corrugated paper, and ship both the plastic and the paper to the appropriate places.
Wal-Mart reports that so far, even though this new process of “sandwich baling” is in its pilot stages, it is doing very well. So far, they have tried it in 326 stores, and in the second month, the average pounds of recovered plastic from the top ten stores was 2,748 lbs. This could mean that for the 326 pilot stores, 895,848 lbs total could be collected. This is equal to 448 tons of plastic per month and 5,376 tons of plastic per year that’s kept out of landfills. To give you an idea of how much plastic this is, it would fill up a football field size container stacked 150 ft. high! (Wal-Mart Environmental Fact Sheet)

Another new program that Wal-Mart is involved with that stemmed from the “sandwich bale” invention is called the Kid’s Recycling Challenge. This program gives children the chance to learn about their environment while earning money for their schools. This program allows kids from California and from Salt Lake City, Utah in grades K – 6 to collect plastic shopping bags and bring them to their school where they are collected in 60 gallon bags. Then, the school turns these bags in and gets $5 for every 60 gallon bag full of plastic bags. There are also monetary prizes for the top three schools that collect the most bags. Third place gets $500, second place gets $1000, and first place gets $1500 plus an environmentally themed school assembly. So far, there have been 400 schools that have participated. These schools have done remarkably well recycling 209,000 lbs. (104.5 tons) of plastic. They have also earned more that $116,000 from the Wal-Mart Foundation. (Wal-Mart Kid’s Recycling Challenge).
Wal-Mart is also looking for new ways to help the environment and to recycle in a slightly unconventional way. They have developed two experimental “green” stores that are geared to help Wal-Mart “reduce the use of energy and natural resources used in running its stores, reduce the amount of raw materials used in building stores and increase the use of renewable materials” (Forgrieve, 2005). These two stores are located in McKinney, Texas, and in Aurora, Colorado. These stores use wind turbines and solar panels, as well as skylights, and 15 foot tall windows along the top of the walls that let in enough natural light to avoid using artificial lights during the day. These stores also have hot water pipes that run under the floors to provide enough heat to warm the inside of the store. These stores also do a lot in the area of recycling. Pallets are turned into mulch, which is used to make a bed for native plants throughout the parking lot. The Aurora store also has boilers that create heat by burning used motor oil, and used chicken frying grease. Even the countertops in the customer service are recycled. They’re made from a material called Icestone, which is concrete made with 75% of recycled glass. (Forgrieve, 2005).

In the McKinney store, food waste from the produce, meat, dairy, and deli departments is recycled. This waste is usually sent to landfills, but at this store, it is sent to a local commercial composting facility where it is processed and made into compost. This compost is then made available for purchase in other stores, thus decreasing the impact of organic waste in local landfills (McKinney Store, walmartstores.com). Wal-Mart hasn’t said how much it cost to build these two stores, but the company has committed itself to monitoring these stores for three years to see if they are really making a difference; and, they are looking to see if they should implement these practices in other cities (Forgrieve, 2005).
Overall, Wal-Mart does its share of recycling. However, compared to companies like Target, they are not outstanding. Basically, each company does different things to recycle and help the environment. Dick Pastor, director of Wal-Mart’s Environmental Management group said, “We are constantly looking for ways to improve the amount of material that can be recycled and eliminate as much waste material as possible” (Orloski, 2006). Wal-Mart is certainly doing different things to help the environment, but there’s always room for improvement.


REFERENCES



Forgrieve, J. (2005, November 9). Wal-Mart goes green: From solar to recycling,
Aurora store designed as test space for chain. Rocky Mountain News. Retrieved March 28, 2006, from LexisNexis database.

Hightower, J. (2002, May 8). Wal-Mart: The world’s biggest corporation. CorpWatch.
Retrieved April 25, 2006, from: http://www.corpwatch.org/article.php?id=6848

McKinney Store. Retrieved April 25, 2006, from: http://www.walmartstores.com/GloblaWMStoresWeb/navigate.do?catg=445&con tId=5639

Orloski, A. (2005, August). Waste ‘sandwich’ helps Wal-Mart recycle. Enviroscope. Retrieved March 28, 2006, from: http://www.packworld.com/articles/Features/19644.html

Wal-Mart Kids Recycling Challenge! (n.d.). Retrieved March 25, 2006, from: http://www.kidsrecyclingchallenge.com/index.html

Wal-Mart Environmental Fact Sheet. (n.d.). Retrieved March 28, 2006, from: http://www.walmartfacts.com/docs/acres_for_america_wm_enviro_fact_sheet.pdf

Holder, A. (n.d.). Recycling. Retrieved March 25, 2006, from: http://www.homeprojects.org/recycling.php?

Gail Clendening
Bemidji State University

Forced to Shop Cheap?: Relationships between Opinions about Wal-Mart, Income Levels, and Shopping Behavior


The purpose of this study was to determine how closely opinions about Wal-Mart correlate to how often people of different income levels shop there. It was hypothesized that with increases in income, people are more likely to have shopping patterns that more closely reflect their opinions about Wal-Mart.
Methods
Subjects and Sampling
A purposeful cluster sample of 28 classes was chosen to represent a broad range of students. The majority of classes offered at Bemidji State University are located in six buildings. Beginning with the 3rd class on the list of spring courses, every 10th course was chosen until one course at each undergraduate level (1000, 2000, 3000, 4000) in each of the six buildings was selected. Prior permission of the professor was obtained. If a professor did not permit the survey to be administered in that class, the next listed same level class in the same building was selected as a replacement. There were four replacement classes.
A total of 389 students from Bemidji State University participated in the study. The results of 342 surveys were easily entered into the database; additional tabulation is necessary to complete the data set. All results in the following text are based upon the 342 surveys.
The average age of respondents was 21.71, the youngest respondent was 16, and the oldest was 63. Students reported forty-eight different majors. The declared majors were primarily from mass communications (32), biology (33), education (36), and
business (36).
All Bemidji State University administrative staff and faculty listed on the mailing list were given the opportunity to participate in the survey. The results of these surveys have not yet been entered into the database.
Procedure
Students were administered survey questionnaires in the classrooms. All participation was voluntary; the Human Subjects Committee at Bemidji State University approved data collection. Directions were given when handing out the surveys directing students to hand in a blank survey to indicate a choice to not participate. Four surveys were returned blank.
All administrative staff on the mailing list were mailed the survey with a cover letter stating the intent of the survey and directions for returning it.
All faculty on the mailing list were mailed the survey with a cover letter stating the intent of the survey and directions for returning it. All participation was voluntary; the faculty senate was notified as to the intent of the survey. A reminder e-mail, with directions on how to obtain a second copy of the survey, was sent out two weeks after the initial mailing.
Limitations
There were limitations to this study. It was only administered at Bemidji State University. Students who did not show up for class the day the survey was handed out missed the opportunity to participate. There is a possibility not all of the administrative staff and faculty were listed on the mailing list used. Those not on the list had less opportunity to fill out the survey. Honesty of the people filling out the survey could not be controlled.
Results
The administrative staff and faculty surveys have not been entered into the database yet; therefore, comparisons in different income levels are not yet available. The following results are all from the easily entered student surveys.
Twenty five point one percent of the students reported doing 76-100% of their shopping at Wal-Mart. 30.4% reported 51-75%; 12.6% reported 26-50%; 26.0% reported 1-25%; 5.8% reported that none of their shopping was done at Wal-Mart.

Of the people who reported doing 50% or more of their shopping at Wal-Mart, 42.9% said price was the most important factor; 41.4% said convenience was most important. 39.3% said convenience was the second most important factor; 33.0% said price was the second most important factor.
Of those who do less than 50% of their shopping at Wal-Mart, 23.7% reported “poor service, unpleasant atmosphere, etc.” as the most important reason; 18.4% reported “other”; and 14.0% reported “I disapprove of one or more of their practices.”
There were five questions asking people to rate their knowledge about Wal-Mart’s practices as mostly positive, mostly negative, or neutral. The topics were 1) employee wages, benefits and working conditions at Wal-Mart; 2) hiring and promotion practices at Wal-Mart; 3) labor conditions of Wal-Mart domestic and overseas suppliers and sub-contractors; 4) environmental awareness and practices; 5) charitable giving and community support.
Eight people answered mostly positive to all five of these questions. To the question “Where did you get most of your knowledge about Wal-Mart”, two responded they work(ed) there, one work(ed) for a competitor, one said from observation, one person’s mom worked there for 20 years, two said from television, and one said from friends. To the question “What is your overall attitude toward Wal-Mart,” one person said somewhat negative, the other seven said mostly positive. All eight reported that their knowledge of Wal-Mart does not affect their shopping habits.
Twenty-two people answered mostly negative to all five questions regarding knowledge about Wal-Mart’s practices. Sixteen of them rated their number one knowledge source: nine from friends, one from observation, two from television, two from radio, one from books and one from news. The other six did not rate in order of importance, but said their sources of information were television, friends, college classes, newspapers, and alternative Internet sites. Sixteen report their attitude toward Wal-Mart as mostly negative. Six report their attitude as somewhat negative. Seventeen of these people say their knowledge affects their shopping habits; five people said their knowledge does not affect their shopping habits.
How much do students believe the average amount they spend each time they visit Wal-Mart? Ten point five percent said $10 or less; 31.9% said $11-20; 27.2% said $21-30; 9.6% said $31-40; 14.3 % said $41 or more; and 6.4% said they don’t shop at Wal-Mart. Ttwenty-two people reported doing no shopping at Wal-Mart on this question as opposed to twenty reporting no shopping at Wal-Mart in the first question.
One hundred twenty-six respondents (36.8%) said they go to Wal-Mart once a week or more. One hundred eighteen (34.5%) go 2-3 times per month. Thirty-eight people (11.1%) go once per month. The remaining sixty people (17.5%) go less than once per month.
One hundred forty-one students (41.2%) reported an annual personal income of less than $5,000; 112 or 32.7% reported making $5,000-$9,999; 46 or 13.5% reported making $10,000 to 14,999. Twelve point six percent said their income was higher than $15,000 or did not respond.
Forty-one point two percent said they spend $25 or less on items such as food, clothing, hardware, electronics, toiletries and drugs, etc., but not eating in restaurants. Thirty-two point seven percent (141 people) responded $26-50; 13.5% (112 people) said $51-75; 9.1% (46 people ) said $76-100; 1.5% (five people) said $101-150; 1.5% (five people) said $151-200; and .6% (two people) did not answer.
Graph 1 shows how closely student attitudes and percentage of shopping done at Wal-Mart correlate. This relationship (where r equals approximately .56) can be classified as a medium relationship. It is expected the faculty will have a higher value for r, therefore showing a stronger relationship. This is only a correlation. One cannot deduce a causal relationship from this kind of study, only that the two variables are occurring at the same time.











Discussion
The results are interesting. It was expected that even less of a correlation between students’ attitudes and shopping patterns would exist. It will be interesting to see the results of both the administrative staff and the faculty. It is believed the faculty will show the strongest correlation and the administrative staff the smallest correlation. This is based on the life cycle model from macroeconomics. This theory state people spend an annuity of what they expect to earn in their lifetimes. The administrative staffs most likely feel their income level is about where it will be for their lifetime. Students, while they do not earn much now, believe they will earn more in the future and will tend to shop based that income level, not their current earnings.

David Gurney
HOPR 1105
Final Paper

Wal-Mart’s Half-Secret Child Labor Associations

Since I have begun researching Wal-Mart’s association with child labor, I have found myself in a number of discussions where child labor was mentioned in association with today’s world. The general response to this was usually something along the lines of, “child labor? What is this, the 1930’s? That doesn’t happen anymore, does it?”
The number of facts and figures that I have come across in a short time of researching this topic is enough to convince me that the general public, or at least the people that I have talked too, are either voluntarily or involuntarily oblivious to the enormity of child labor being used in today’s world; in many instances, to produce the clothing and other essential things that we buy here in the United States (LexisNexis, 2005).
According to a report launched by UNICEF, one in twelve of the world’s children (80 million young people below the age of 18) are involved in the worst forms of child labor – hazardous work, slavery, forced labor, commercial sexual exploitation and illicit activities. Ninety-seven percent of these are in developing countries (UNICEF, 2005). Unfortunately, it seems as if child labor is quite pervasive in today’s world.
The issue of Wal-Mart using children in foreign countries as labor in some of their factories first arose in 1996, when Charles Kernaghan, executive director of the National Labor Committee, revealed in a congressional hearing that workers in a Honduran factory producing clothing for the Kathie Lee Gifford line were children. Ten percent of the workers were found to be between ages 13-15. The publicity generated by this incident was quite damaging to Wal-Mart since forbidding child labor is one of the absolutes of the global economy (Fishman, 2006). A pair of workers were brought overseas by the NLC and testified before congress as to the conditions under which they worked. Testimony from the workers included accounts of physical abuse. One worker stated that if she didn’t sew to the mandated pace, 120 pairs of pants per hour, a supervisor would slap her across the face with the pants she was sewing. Wal-Mart did not challenge this report. Other conditions reported by the two female workers included lack of breaks for water and bathroom, forced overtime, banned talking among workers, verbal abuse by managers to work faster, along with many others. Four armed guards were present at the factory to intimidate workers (Asghar, 2001).
Since the Kathy Lee Gifford incident, Wal-Mart has attempted to make their use of inspections in overseas factories more public in order to shed a more positive light on their image. A factory “code of conduct” is required by Wal-Mart to be signed by the managers of all its supplier factories, as well as being posted in the factory in the language of the workers. In 2004, 12,500 inspections were conducted by Wal-Mart, more than 30 a day, which led to 108 factories being banned from doing business with Wal-Mart due to serious violations of Wal-Mart’s factory code. Another 1,211 factories were punished by cutting off business for a certain period. 260 of these factories corrected violations and were allowed to begin business with Wal-Mart again (Fishman, 2006). This is the positive interpretation of Wal-Mart’s data. However, since the incident in 1996, a number of independent investigators have uncovered labor abuses in overseas factories, including the use of child labor in production. All of this was behind Wal-Mart’s back of course, since they openly oppose independent investigations into the conditions of their factories overseas. Independent investigations are the “Gold Standard” because they provide less data that is less likely to be biased. They also tend to provide more unannounced inspections, as well as off-site interviews, which provide a more realistic look at a factories practices (Fishman, 2006). In one investigation by the NLC, a 13-year-old female worker from Bangladesh was found and interviewed. She reported being forced to work from 7:30a.m. to 3:00a.m. for the last three months. She would sleep by her sewing machine for four hours, wake up, and start sewing again. She was called a prostitute and a whore by her supervisor and paid 1 cent per 30 pieces of clothing completed (NLC, 2002).
One way to try to understand the gap between Wal-Mart’s reports of inspections and other reports of obvious abuses like the one mentioned above, it to look at Wal-Mart’s numbers in a different way. Charles Fishman (2006) has this to say about the matter:
Although 12,500 inspections were conducted in 2004, only 8% were unannounced. Even so, Wal-Mart reports that 9,900 of the inspections resulted in violations serious enough to either suspend a factory or put it on notice. 8,900 inspections of factories in 2004 revealed serious violations in factories that knew in advance that Wal-Mart inspectors were coming! (p. 189)
What would happen if 90% of these inspections were unannounced?
The largest problem with Wal-Mart’s inspection process is just that: it IS Wal-Mart’s inspection process. Wal-Mart does not allow independent inspections of any of its overseas factories. Such inspections are the gold standard, as they avoid a conflict of interest and are much more likely to reveal accurate data with surprise inspections and off-site interviews with workers. KLD & Company, the leading institution which measures corporate social responsibility, dropped Wal-Mart from its list of responsible investments, saying that Wal-Mart has not done enough to ensure that its domestic and international vendors operate factories that meet adequate labor and human rights standards. KLD notes that Wal-Mart’s market dominance puts it in a unique position to lead retailers in a cleanup of sweatshop abuses. However, to date it has declined to do so (Thomsen, 2001).
It is important to remember that it is Wal-Mart itself that dictates the sometimes unbelievably low prices in its stores. These prices don’t come for free however. They are at the expense of the pay provided to the producers of these products, from the distributors, all the way down to the factory workers (NLC, 2002).
Despite the absolute opposition to child labor in the United States, and the heavy enforcement of child labor laws, we need not even cross the border to find incidences of Wal-Mart using illegal child labor in its factories and stores. In 2005, Wal-Mart agreed to pay $135, 540 to settle child labor violations in 24 separate incidents. These abuses involved the use of children in operating machinery designated for over 18 workers only. In addition to this, Wal-Mart was fined $205,650 for 1,436 violations of child labor laws for the period 1995-1998. The Department of Labor agreed to give Wal-Mart 15 days notice before visiting and/or investigating allegations of wage and hour violations in the future, part of what critics call the “sweetheart” deal offered to Wal-Mart for its settlement of child labor violations (Wakeup, 2005).
Wal-Mart’s latest child labor scandal came in 2005 when the Canadian Broadcast Company planted a number of its reports in Bangladesh factories posed as merchandise buyers. The reporters took pictures of children working in dirty and dim conditions. A 10 year old was found working on a T-shirt with the slogan “I Love My Wal-Mart” printed on it. Wal-Mart immediately pulled its business from these factories. This “cut and run” strategy used by Wal-Mart in incidences of abuse is often cities by critics as doing to nothing to solve the problem of labor abuses, but only hurting the workers in the factories effected (LexisNexis, 2005).
This paper cannot even come close to describing the depth of the associations between not only Wal-Mart, but a number of other corporations, and child labor, not to mention a plethora of other blatantly unethical business practices. Uncovering just a tiny portion of these labor abuses has taught me a number of things. There is a massive gap between what really is going on in the world with child labor, and what the average person thinks is going on. In our modern world of 24-hour news shows and internet reporting, it is difficult to understand how such a huge issue as child labor could be swept under the table, apparently so well as to convince a number of people that is no longer even exists
The scope of this problem cannot be adequately described in this particular paper. Suffice to say that the abuse of children in any way is perhaps the most horribly immoral and unethical practice that any person or entity could engage in. Most people are disgusted by the very notion of child abuse. And yet it continues to be practiced by the very powers that dictate a great part of our lives, the corporations. In order for this to change, awareness must first be gained by the general population. More light needs to be shed on a topic that is normally confined to the darkest shadows.

Bibliography


Asghar, Sajeed (2001). TED Case Studies: Kathy Lee Gifford & Sweat Shop Allegations

Retrieved April 10, 2006, from http://www.american.edu/TED/kathylee.htm


Fishman, Charles (2006). The Wal-Mart Effect. New York, NY: The Penguin Group.


LexisNexis Academic (2005). Radio-Canada investigation claims Wal-Mart suppliers

use child labour. Retrieved April 10, 2006, from http://web.lexis-nexis.com.web

mail2.hampshire.edu:2048/universe/


National Labor Committee (2002). Working for Wal-Mart. Retrieved April 10, 2006,

from www.nlcnet.org/news/Selinas_Story.pdf


Thomsen, Mark (2001). Wal-Mart booted out of the Domini 400. Retrieved April 10,

2006, from http://www.sri-adviser.com/article.mpl?sfArticleId=552


UNICEF (2005). One in twelve of the world’s children are forced into child labour.

Retrieved April 10, 2006, from http://www.unicef.org.uk/press/news_detail.asp?

news_id=392


Wakeup Wal-Mart (2005). Wal-Mart & Child Labor Violations. Retrieved April 10,

2006, from http://www.wakeupwalmart.com/downloads/wal-mart-child-labor-

facts.pdf

Woeman Fighting Wal-Mart
Wages and Discrimination
Tee Harris


When I started my paper I only was going to concentrate only on the way women are paid less then men know I’m throwing in discrimination. Everyone should be treated fairly whether it is pay or a position in a company. Because I heard so many things about Wal-Mart and how they treat women unfairly that is the biggest reason why I wanted this topic because I have niece and I don’t want her to go through these types of thing in her life.
One story I found was about Stephanie Odle who started working at Sam’s Club even thought she was pushed into working there. However when she work there for some time she said “I wanted to work my way up the ladder and I just knew this was the company I wanted to be with forever” (Featherstone). So she did work hard and she was moved to “the company spirit that she was selected to teach Sam Walton’s principles to her coworkers in optional “Strive for Excellence” classes” (Featherstone). Over time “Odle would end up working in 11 different Sam’s Clubs in three states” (Featherstone). When she moves to a Sam’s Club in Dallas she was happy because she wanted to get out of her small town. While she was working there she “gave up lunch hours, weekends, vacation time and holidays to be there when Sam’s Club needed me. She got on a plane and flow home after work an Christmas Eve, then got on another plane and flew back before dinner on Christmas Day, not just once every year” (Featherstone). In 1996 Odle became an assistant manager at Sam’s Club in Riverside, California. As she was there she found out that another assistant manager “Arenales was making $10,000 a year more than she was. She felt as if she’d been punched in the stomach. Not only did she and Arenales do the same job, it was also his first year with Sam’s Club. Odle had been there for more than five years” (Liza). So she went to the manager and asks way Arenales was making more than her he said “Arenales has a wife and two kids to feed” how ever Odle was going to became a single mother herself (Featherstone). After she talk to the manager “Odle got a raise of $40 per week, which didn’t bring her salary even close to Mario Arenaled” (Featherstone). “Over the next three years, Olde was transferred four times and endured numerous painfully sexist incidents” (Featherstone). Which when she started she wanted to work hard but it would be hard to keep going doing your job as hard as you once did. However, she was moved to Florida’s Sam’s Club and she wanted to get a promotion to cash register technicality and she was denied so a man could get that spot. “Odle’s managers compounded the insult by transferring her back to Lubbock, the small hometown she’d hoped to escape by working for a huge multinational company” (Featherstone). After all this she wants to sue Sam’s Cub but she doesn’t because she could not do it by herself so she waited and she waited for other women and that’s when it became a class action lawsuit. There are all kinds of other stories in Featherstone’s book Selling Women Short about women discrimination.
I was on Wal-Mart web site and I was look for women wages they do not have anything I’m not sure if they are trying to hide something or if they just do not give that information. There has been all kind of stories that say that Wal-Mart was fare to their entire employee’s in fact it says that on Wal-Martfacts.com which is not true. The pay for employee’s “In 2001, the last year for which Wal-Mart has released figures for most occupations, sales associates, the most common job in Wal-Mart, earned on average $8.23 an hour for annual wages of $13,861.The 2001 poverty line for a family of three was $14,630” (Wakeup Wal-Mart). I also once heard that women get paid about 34 cents less then men which is no fair for the women that work at Wal-Mart. For the most part a lot of women like their job until they find out that they are not getting treated fairly which no man or woman should not be treated fair. Another web site stats that “Regional VP $279,772, District Manager $177,149, Store Manager $89,000, Co-Manager $56,317, Asst. Manager $37,322, Mgmt Trainee $22,371"(Wakeup Wal-Mart). Keep in mind these are the average pay for female workers. I figure I would list them because most Wal-Mart employees are female. If you're a male probably, you would make about 5-6% more in an hourly position (not much of a gap) or around 44% more in the upper position whereas regional male makes $440,000 vs. the $279,000 a female makes. One other thing a lot of Wal-Marts hire people in at various rates (the lowest rate possible). In my area the four stores hire in people about the same anywhere from “7.50 to $8.50 an hour for 1st/2nd shift and $8.00 to $9.50 an hour for 3rd shift. However only 90 miles south of us the stores hire people in at $6.00-$6.50 for all three shifts” (you are worth more).
Wal-Mart has so many lawsuits against them like “A small group of current and former female associates is engaging in a lawsuit against Wal-Mart whereby they claim that Wal-Mart discriminates against females. Despite a ruling in June of 2004, whereby the United States District Court for the Northern District of California certified the case as a class action Wal-Mart objects to such a classification” (Wal-Mart facts). There is a project that has “the purpose of the Wal-Mart Litigation Project is to assist lawyers who sue Wal-Mart to force the company to act properly toward its customers and employees. The project's goal is to "level the playing field" so plaintiffs have a better chance of winning suits where Wal-Mart has done wrong by educating plaintiffs' lawyers about cases similar to their own against Wal-Mart, and by facilitating communication between plaintiffs' lawyers on issues of law, discovery and litigation tactics” (Wal-Mart Litigation). “The U.S. Equal Employment Opportunity Commission (EEOC) announced that a $6.8 million consent decree with retail giant Wal-Mart Stores was signed today by Federal District Court Judge Garland Burrell in Sacramento, Calif. The decree resolves the EEOC's lawsuit, Case No. S-99-0414-GEB DAD, which alleged that Wal-Mart's pre-employment questionnaire, "Matrix of Essential Job Functions," violated the Americans with Disabilities Act (ADA). Parties to the decree also have agreed to settle 12 other ADA lawsuits filed against Wal-Mart in 11 states” (EEOC). Woman are not the only people discriminate against it’s a long list of people from women to people with disabilities.
“Wal-Mart can cover the cost of a dollar an hour wage increase by raising prices a half penny per dollar. For instance, a $2.00 pair of socks would then cost $2.01. This minimal increase would annually add up to $1,800 for each employee” (wakeup Wal-Mart). I believe they do not because they want to keep their product low prices and they want to keep their employee’s at low wages. Say that because Wal-Mart wants the minimum wage increased so they have to pay them more but other company’s would also have to boost their wages as well and other companies would not get a leg up if they do it that way.
Women health could be affected by all this that is going on with Wal-Mart because of all the stress that they are put under. However Wal-Mart said “Women's health and well-being is a growing concern for all women, and women not only are responsible for their own health, but also make more than 70% of the health care decisions for their loved ones. For this reason, Wal-Mart is supporting Speaking of Women's Health, a nonprofit organization dedicated to Òeducating women to make informed decisions about their health, well-being and personal safety” (Wal-Mart foundation). They say they are trying to help women health but for some women that work for Wal-Mart their health is getting worst I do not believe that is helping if they want to help they should start treating women fairly.




















References

Featherstone, L. (2004). Selling Women Short: The Landmark Battle for Workers’ Rights at Wal-Mart (pp. 13-25). Basic Books, NY, New York.

Wakeup Wal-Mart (2006).Wal-Mart Wages and Worker Rights: A Substantial Number of Wal-Mart Associates earn far below the poverty line. (wakupwalmart.com)

Wal-Mart Facts (2006).Wal-Mart: Supporting Our Communities and Making a Difference in People’s Lives. (walmartfacts.com)

EEOC (2006). COMPREHENSIVE EEOC, WAL-MART SETTLEMENT RESOLVES DISABILITY LAWSUIT. (eeoc.gov)

Wal-Mart Foundation (2006). Speaking of Women health: Take a Pledge for Better Health at Wal-Mart. (walmartfoundation.org)

Orie House
HOPR 1105

Wal-Mart and China: An Economic Success Story of Two Giants

When talking about Wal-Mart, one inevitably has to talk somewhat about China too. The two have become almost synonymous in recent years, because of all the investing that Wal-Mart has done in China, and the large number of products in Wal-Mart that are manufactured in China. Wal-Mart is a economically savvy corporation that has created a growing niche for itself in China much the way that it has in the United States. However, according to the Los Angeles Times (2006), there is a growing trade deficit, or the difference between what a country imports and exports, between China and the U.S., which has almost reached two hundred billion dollars in China's favor. This has resulted in a social backlash in the United States.
A Los Angeles Times (2006) editorial says:
China is an easy target for our economic grumbling. It is ruled by a Communist Party. Its currency, the yuan, does not float freely. It often looks like a monolithic machine, with factories of assembly-line workers churning out low-cost goods to fund its march toward world domination. It has about $800 billion in foreign reserves stashed away.
That is a very good summary of why many Americans see all this economic activity coming out of China as a bad thing. The Los Angeles Times (2005) draws many parallels between the Japan scare fifteen years ago and the present situation with China. At that time the Japanese economy grew very rapidly due to their manufacturing and exporting industry. This also caused a massive trade deficit with the United States. However, one of the key differences this time is that there are more political pressures added to the already large economic ones. China is a communist country with nuclear weapons, and tensions run high between China and many of their Eastern neighbors including Taiwan, South Korea, and Japan. All are close U.S. allies.
One of the concerns raised about U.S. economic dealings with China is the fact that some believe the Chinese are competing unfairly. The Chinese unit of currency, the yuan, has been kept artificially low in value in order to help the Chinese economy and is preventing the rest of the world from competing. In the opinion of the Los Angeles Times (2006), “there is no reason to believe that a different valuation of the yuan would seriously affect the galloping trade between China and the U.S.” However, according to Wonacott and Phillips (2003), many U.S. companies claim that it is hard to compete against China when the currency is “artificially weak.” The National Association of Manufacturers estimates that Chinese trade goods are forty percent cheaper than they should be, and says that China is to blame for many lost American jobs (Wonacott and Phillips, 2003). There seems no clear cut answer on just what help raising the value of the yuan would be, but it is certain that there are significantly more goods coming into the U.S. from China than there are going out.
So it seems that the effects of the current Chinese economic trade practices are bad for the United States. However, when the United States Congress mandated that the U.S. Treasury Department review the Chinese economic practices, China was found innocent of manipulating the yuan (Wonacott and Phillips, 2003). That was good news for China; if they had been found guilty of manipulation the United States would have had to enter into formal negotiations with China over the matter.
Wade, Professor of Political Economy at the London School of Economics (2003, p. 39) says:
I agree with the globalizers that economic growth is essential to raise the living standards of the world's poorer people (as are changes in our measures of economic growth to weigh environmental quality and public services properly). I agree that more open markets in the West for labor-intensive and land-intensive exports from developing countries would help, and that more foreign direct investment from the West, more technology transfer, is generally to be welcomed.
Wade (2003, p. 40) departs from what he calls the “liberal argument” for globalization when it comes to the widening absolute income gap between the West and the rest of the world, including China and India. So while this foreign investment in China is helping the Chinese economy overall, it doesn't exactly help everyone in China. On a global scale the rich are getting richer, and the poor aren't doing much of anything. In 2001, the World Bank said that the total number of people living on less than one dollar a day was 1.2 billion, though this is generally considered to be a low estimate (Wade, 2003, p. 19). The rural regions of China are falling prey to this process, since they are out of the investment loop that the rest of the country is currently in.
Wal-Mart really isn't concerned with all that, though. What Wal-Mart wants from China are the inexpensive goods that China can produce. Wal-Mart bought about $18 billion in goods from China in 2004, the last year for which it has released numbers (Kabel, 2006). This inflow of goods is one of the major reasons that Wal-Mart has been able to sell things at their low prices. However, some of the reasons behind China's economic success are not well known. During his lecture “Wal-Mart, China, and You” delivered at Williams College in Massachusetts, sociologist Gary Hamilton stated, “China’s ability to produce low-cost goods is not simply the result of cheap labor, as many people believe” (Mulvihill, 2006). Low wages are only partly responsible for drawing in China’s increased manufacturing business. Many other countries have cheaper labor than China, and China itself has its own share of outsourcing. What helps China the most is the infrastructure created by China’s large cities, ports, and highways. This “distribution network” seems right in line with the Wal-Mart values, and mirrors their own success at creating efficient distribution in the United States. It allows China to produce what is needed reliably and in large numbers. It also helps that China has a huge sea cost and many ports. China is also almost at the geographical center of the East, causing it to be the ideal place to put goods together from parts brought in from the surrounding countries.
Despite the huge investments made by Wal-Mart and other U.S. companies, China still has mostly Asian investments. In 2004, three-quarters of their $60 billion in Foreign Direct Investment (FDI) came from Hong Kong, Japan, Taiwan, Korea, and Southeast Asia (Barshefsky and Gresser, 2005).
In addition to importing Chinese goods for American consumption, Wal-Mart also now has a strong retail presence in the growing Chinese economy. Wal-Mart spokeswoman Amy Wyatt has stated that Wal-Mart could hire as many as 150,000 new employees in China over the next five years, and twenty new stores are being opened this very year, adding on to the existing 56 stores with 30,000 employees (Kabel, 2006). In fact, Wal-Mart's Chinese business is now growing faster than their U.S. counterpart. The 2005 increase in operating income for Wal-Mart's international division was 11.4 percent compared to the U.S. division's 8.2 percent (Kabel, 2006). Because Wal-Mart doesn't supply a breakdown of international financial results by country, the only number available is the total for international sales, which was $312.4 billion last year or 20 percent of Wal-Mart's overall net sales (Kabel, 2006). The company is also very optimistic about the future of the chain in China. Joe Hatfield, chief executive of Wal-Mart Asia, has stated that his company's Chinese operation could be as big as its 3,700 store United States business in the next twenty years (Watts, 2006). With a Chinese population of 1.6 billion, this isn’t at all surprising.
That's not to say Wal-Mart hasn't had a bit of a rocky road setting up their Chinese operations. Retailers, like Wal-Mart, that want to get into business in China need to adapt to get their products to sell. The idea that it won't sell if it's not fresh, is one of the ideas that they have had to adapt to in China. Turtles, bass, perch, carp, and shrimp are all sold live in the store, and customers enjoy netting them by themselves (Watts, 2006). This type of business doesn't seem like what Americans typically know as a store, but it is built on the Chinese tradition of markets. Because there was no way to keep the food from spoiling, it always had to be purchased as fresh and often as possible. The Chinese are simply into the habit of doing business this way.
Retailers in general, though, are growing in popularity for a number of reasons; one of the chief ones being the safety of their grocery departments. There is a growing consciousness of safety in China, particularly in the realm of food. Large grocery retailers like Wal-Mart offer a security that the traditional Chinese markets can't deliver (Watts, 2006). In addition, the tradition of freshness shows up again in the frequency of Wal-Mart visits. Chinese shoppers come more frequently than in the United States (though spending less), some more than twice a day. It is a good thing, then, that staffing levels are higher and labor costs lower to deal with the massive amount of traffic a Chinese Wal-Mart experiences (Watts, 2006).
Wal-Mart isn't the only American company interested in China, either. The sheer number of people in the country is enough to attract almost any business. Companies like Starbucks are setting up shop in the most unlikely of places, such as the Imperial Palace or the Gugong as The Forbidden City is commonly known in China (Watts, 2006). As their economy grows, and more Chinese people have the ability to spend their money, this pattern is sure to continue.
Wal-Mart is not the only influence on the Chinese economy, or the U.S. economy for that matter, but the influence can be seen. The trend towards getting goods manufactured in China is closely tied to their ability to do the job cheaply and well, though some claim it's at an advantage over other countries due to various methods of economic “cheating.” However, China as well as the rest of East Asia can help themselves and the U.S. improve economically. Wal-Mart appears to be both part of many problems in China and the U.S. and at the same time is bringing economic success. Whatever the case, it's hard to blame China for this economic boom. The Los Angeles Times (2006) says, “the real cause of grumbling about China is probably the remarkable phenomenon that the world's most populous nation has been booming steadily for 15 years...China shouldn't be blamed for engaging the global economy in a way that benefits us all.”