Wal-mart Chief Defends Closing Unionized Store

[whlinder]

By Michael Barbaro
Washington Post Staff Writer
Friday, February 11, 2005; Page E01

The chief executive of Wal-Mart Stores Inc. yesterday defended the retailer's decision to close a Canadian store after its employees voted to form a union, saying demands from negotiators would have forced an already unprofitable store to hire 30 more people and abide by inefficient work rules.

"You can't take a store that is a struggling store anyway and add a bunch of people and a bunch of work rules that cause you to even be in worse shape," H. Lee Scott Jr. said.

In his first interview since Wal-Mart announced it would close the store in Jonquiere, Quebec, Scott said Wal-Mart saw no upside to the higher labor costs and refused to cede ground to the union for the sake of being "altruistic."

http://www.washingtonpost.com/wp-dyn/artic...-2005Feb10.html

 

[JS]

 

[mweiss]

Now if only the employees of Wal-Mart in the US would do the same. That'd take care of the company in short order.

I have no love for that company.

 

[PRINCESS KIDAGAKASH]

A Walmart store that is unprofitable? <_< Who does Wal-Mart think they are kidding? This is nothing but a union busting tactic. :down:

 

[mweiss]

Believe it or not, there are instances of Wal-Mart stores that are unprofitable, at least until they are shut down. Ironically, Wal-Mart's own marketing, which focuses on price über alles, has trained their customers to be extremely price sensitive. The rising costs of fuel, coupled with the falling dollar, has had a significant impact on Wal-Mart's profitability.

If you ask me, couldn't happen to a nicer bunch of folks.

 

[TWAnr]

If you ask me, couldn't happen to a nicer bunch of folks.

[post="247337"][/post]​

Michael,

Surely you mean the Wal-Mart BOD and executive staff as opposed to the exploited and soon to be unemployed employees of that store.

 

[mweiss]

Surely you mean the Wal-Mart BOD and executive staff as opposed to the exploited and soon to be unemployed employees of that store.

[post="247543"][/post]​

I do, indeed. And don't call me Shirley.

 

[diogenes]

Believe it or not, there are instances of Wal-Mart stores that are unprofitable, at least until they are shut down. Ironically, Wal-Mart's own marketing, which focuses on price über alles, has trained their customers to be extremely price sensitive. The rising costs of fuel, coupled with the falling dollar, has had a significant impact on Wal-Mart's profitability.

If you ask me, couldn't happen to a nicer bunch of folks.

[post="247337"][/post]​

-----------------------------------------------------------------------------------------------

Ditto.

Rumor has it Costco is coming to our little 'burg.

Another dagger into the evil empire.

 

[whlinder]

Wal-Mart, Union Vie for Tiny Shop

By T.R. Reid and Amy Joyce
Washington Post Staff Writers
Friday, February 25, 2005; Page E01

LOVELAND, Colo., Feb. 24 -- In the 35 months he has worked for one of the world's richest corporations, Joshua Noble has received several commendations, he says, and three raises. But that still leaves him with an annual wage below $20,000 and a grand total of one week of vacation per year.

"It's frustrating, to be at a big company for three years, and you're still struggling all the time," says the 21-year-old with a dark crew cut and an array of rings piercing his ears. "By the time they take out the health insurance [premium], you can't even pay rent. I have a full-time job, and I had to move back in with my parents."

That frustration has turned Noble into a foot soldier in what seems likely to be one of the major union-management battlegrounds of the next decade: the fight to unionize Wal-Mart.

Noble, who makes his living selling tires and changing oil at Wal-Mart's massive "Supercenter" store here on the high plains at the foot of the snow-capped Rocky Mountains, has won enough support among his fellow employees in the auto-care shop to force a union election Friday among the department's 20 employees. If more than half the unit votes to organize, the Loveland store could be the first Wal-Mart outlet in the United States to have union employees.

http://www.washingtonpost.com/wp-dyn/artic...ml?nav=hcmodule

I wondered how long this would take, and whether or not Wal-Mart would be able to stop it.

 

[PRINCESS KIDAGAKASH]

If these mechanics vote for unionization at that store, Walmart will all of sudden claim that store is unprofitable and shut it down. Walmart has made billions off of it's poorly paid employees alone. Now their employees are trying to get a fair piece of the pie and Walmart doesn't want to share!

 

[mweiss]

They might well shut the store down.

I disagree that the issue is that Wal-Mart "doesn't want to share." They have built their business on cultivating an extremely price-sensitive demographic. Anything that gets in the way of keeping the prices ultra-low can bring the house of cards crashing down. As evidence, witness the effects to Wal-Mart of a falling dollar and increasing fuel prices. Wal-Mart is profitable, but on margins that would bankrupt many of their competitors; their operating income is only about 6% of sales.

This analysis is not intended, in any way, to be construed as an endorsement of Wal-Mart and the business that they run. I'm just laying out the facts here.

 

[FWAAA]

The union was rejected today by a vote of 17-1.

http://story.news.yahoo.com/news?tmpl=stor...almart_union_dc


Looks like the excessively pierced 21 year old was the only person who wanted to unionize.

If he wants to pay union dues to change oil and move tires, then he should apply at an airline.

Seriously, I have a couple of friends who went to work at Wal-Mart/Sam's Clubs many years ago; today, their net worths are impressive, as they had the good sense to participate in the Stock Purchase plans.

 

[whlinder]

Hypothetical scenario (because I have no idea):

Some of the 20 employees buy stock in Wal-mart, in very small quantities.

20 employees vote to unionize.

Wal-Mart shuts the store down, claiming that it is unprofitable.

Employees who are out of a job are also stockholders. Could they sue the corporation for shutting down a viable store, breaching their fiduciary responsibility?

---
edited to add:
Well said scenarion can't happen, as FWAAA's post indicates. The hypothetical still stands though.

 

[ITRADE]

According to CNN, it was 18-2.

http://money.cnn.com/2005/02/25/news/fortu...dex.htm?cnn=yes

 

[FWAAA]

According to CNN, it was 18-2.

http://money.cnn.com/2005/02/25/news/fortu...dex.htm?cnn=yes

[post="250818"][/post]​

Not to be hyper-technical, but doesn't that article just say that 18 voted against? I don't see where it says 2 people voted in favor. B)