Print

Mail

wiki links

Wal-Mart defends its business practices

"It doesn't make sense ... that people would line up for jobs that are worse than they could get elsewhere, with fewer benefits and less opportunity."

H. Lee Scott Jr, chief executive of Wal-Mart

The chief executive of Wal-Mart took the offensive on Tuesday against critics who have sought to block stores in New York, Los Angeles and Chicago, insisting that the company was good for consumers and good for its 1.3 million US employees.

In a feisty response to critics who accuse Wal-Mart of providing poverty-level wages and few benefits, the executive, H. Lee Scott Jr, said Wal-Mart offered good, stable jobs, noting that when it opens a store, more than 3,000 people often apply for the 300 jobs.

"It doesn't make sense," Scott said, "that people would line up for jobs that are worse than they could get elsewhere, with fewer benefits and less opportunity."

After pointing to headlines on editorial pages that say "Wal-Mart's low prices come at too high a cost," Scott said, "I'd suggest a better headline: `Wal-Mart is great for America.'"

He was speaking at Wal-Mart's first-ever conference for journalists, which was scheduled as the company, the world's largest retailer, faces stiff resistance to its expansion plans in several cities and as labor unions, environmental groups and others are preparing a major campaign to pressure the retailer to change its ways.

Critics complain that Wal-Mart's average wage of US$9.68 an hour is too low to support a family and that only half of its workers receive health insurance from the company.

An hour before the conference, several officials and ministers from Inglewood, California, where residents voted down a planned Wal-Mart last year, held a news conference here. They said that if Wal-Mart ever hoped to build a store in Inglewood, it needed to sign a pledge in which it promised to provide a living wage and better health benefits.

A state assemblyman from Inglewood, Jerome Horton, said, "We're very much concerned about Wal-Mart's business practices because they place a burden on California taxpayers when they don't provide health insurance to employees and when they pay wages that perpetuate poverty in the community."

Scott opened his remarks by noting that some critics who had opposed Wal-Marts in New Orleans and Cincinnati were praising the stores, now that they have opened.

"They're thrilled when we open up in their neighborhoods because they know that they'll have a better chance of participating more fully in the economy with the money they save at our stores," Scott said.

Mike Duke, the president of Wal-Mart Stores, said the company continued to have ambitious expansion plans, hoping to open about 350 stores in the US this year, on top of the 3,703 it already has.

Wal-Mart executives said an 8 percent expansion in floor space was pivotal to plans to increase sales and profits. Its revenue rose 11 percent last year to US$288 billion, while its profit rose 16 percent, to US$10.3 billion.

But its expansion efforts have increasingly been frustrated. In February, a developer planning a Wal-Mart in Rego Park, Queens, dropped the effort in the face of opposition; stores planned for Cleveland, Ohio and the South Side of Chicago have also been blocked recently.

Scott said the company had had good talks with its environmental critics, who were concerned that new stores could fuel suburban sprawl. But he had few kind words for the company's main labor adversary, the United Food and Commercial Workers, saying that its members wanted to block Wal-Mart to help protect their jobs and wages, even if it meant that consumers pay higher prices.

Scott said, "If it wasn't Wal-Mart pushing down prices, it would be someone else, whether it is Target, Dollar General, Family Dollar because people migrate to value."
This story has been viewed 1727 times.