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Wal-Mart tries a `friendlier' approach

After years of accusations that it caused the demise of thousands of smaller merchants, Wal-Mart Stores Inc is undertaking an unusual strategy -- helping competing local establishments stay in business.

Wal-Mart recasting itself as a friendly neighbor? It's the latest course change by the world's largest merchant as it tries to modify its corporate culture -- and the perception that it's a ruthless competitor obsessed with maintaining its dominance of the retail industry.

Wal-Mart's proposal to help rival small businesses, from bakeries to hardware stores, focuses on blighted urban markets where the retailer plans to open 50 stores within the next two years. The efforts will range from giving those businesses financial grants to producing free radio ads that will be broadcast on its stores' radio network.

And the company, which has long been shrouded in secrecy, is trying to appear more transparent. Late last year, it sponsored a debate among a group of economists about whether Wal-Mart is good or bad for the economy. And it's holding its second annual media conference starting today near its Bentonville, Arkansas, headquarters, to share information about the company, from its plans to improve its stores to updates on its employee health care proposals.

The changes are Wal-Mart's response to critics, particularly union-backed groups, who have long argued that the firm has exploited the business model of folksy founder Sam Walton, putting profits before its own employees and towns and cities where it does business.

"The notion that Sam Walton cared about its workers, and the community, those positive aspects have gone," said Chris Kofinis, spokesman for a campaign group funded by the United Food and Commercial Workers.

He described the recently announced moves as a series of public relations stunts.

Analysts say that although Wal-Mart is used to succeeding, it has no guarantees in this endeavor, especially since its core business model -- built around offering incredibly low prices -- won't change.

"The culture remains frugal and very focused on costs and price ... It is going to be very hard to change the culture of the company," said Charles Fishman, author of The Wal-Mart Effect, a book on the firm's impact on the national economy. "Their image of themselves is powerfully fixed, and our image as shoppers is very powerfully fixed."

In fact, as part of its ongoing cost-cutting campaign, Wal-Mart plans to become more reliant on part-time workers, which now account for about 20 percent of its workforce.
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