Wal-Mart critic groups on Monday hosted an “alternative” analyst briefing via a conference call in advance of next week’s Wal-Mart investor conference to point out what they perceive as the company’s shortcomings.
A Wal-Mart spokesman dismissed the event as something to be expected from the union-funded groups.
Dan Schlademan, director of Making Change at Wal-Mart, said the giant Bentonville-based retailer has cut costs primarily by reducing store staffing levels, and that “the stores are in fact struggling to manage without sufficient staffing.”
“Wal-Mart is struggling to keep products on the shelf,” he said.
Dan Fogleman, a Wal-Mart spokesman, said the company’s business “is healthy and it’s growing.” He pointed to the company’s most recent quarterly earnings report, which showed a 2.2 percent increase in sales at stores open at least a year, a key measure of success in retailing.
It was the fourth-consecutive increase in the measure, which excludes the impact of stores opened and closed in the past year.
Fogleman also pointed out that the company’s stock price is up 26 percent in the past nine months.
“We have some of the best jobs in the retail industry, good pay, affordable benefits and the opportunity for advancement,” he said. “Our wages and benefits typically meet or exceed those of our competitors, including unionized competitors.”
Lori Amos, a Wal-Mart employee from Sedro-Woolley,Wash., said on the conference call that in the past two years, staff reductions have led to empty shelves and long lines at checkout. She is a member of a group called OUR (Organization United for Respect) Wal-Mart.
“We stand strong and we stand together, and we won’t be bullied by Wal-Mart,” she said.
Mary Pat Tifft of Kenosha, Wis., another Wal-Mart employee, said hours are being cut and openings at her store are not being filled.
“There’s simply not enough manpower to run these stores,” she said.
Zeynep Ton, a professor at the Massachusetts Institute of Technology Sloan School of Management in Cambridge, Mass., said labor costs often are the first to be reduced when retailers are seeking to lower expenses because they are direct and measurable.
And in Wal-Mart’s case, she said, “people will still go there because of low prices, even if customer service is poor. I’m not saying retailers can’t operate that way. They clearly do.”
Jackie Goebel, a Wal-Mart employee in Kenosha, Wis., said the critic group’s report “really validated what we’re saying about our stores.”
“It is affecting our customers, it is affecting our shareholders,” she said.
Wal-Mart’s stock closed Monday at $74.05 a share, up 25 cents or 0.3 percent on the New York Stock Exchange. The stock has traded between $51.63 and $75.24 in the past year.
Business, Pages 21 on 10/02/2012