February 10, 2009
Hard Times May Soften Opposition to Wal-Mart
Wal-Mart is hoping that
current economic conditions will make it easier for the chain to gain entry
into Chicago. The chain, which operates one store in the city at the moment,
has faced fierce opposition from organized labor and other groups in past
attempts to build new locations.
Working to its advantage
is that new Wal-Mart stores will bring construction and retail jobs, added tax
revenues, plus savings for consumers in the area where it builds.
According to reports, the retailer is looking at about a dozen sites in
the city with plans to open as many as five new stores.
John Bisio, a spokesman
for the chain, told the Chicago Tribune,
“The West Side store set an example as a good employer, a good merchant…
a real economic engine… This is nonsense that we don’t have more Wal-Mart
stores in Chicago.”??
Chicago alderman Howard
Brookins said Wal-Mart would be building a store on the city’s 21st Ward
on the South Side.
“In an economy
where retailers are laying off people, it makes more sense than ever to
pull the trigger,” Mr. Brookins told the Trib.
“This would mean hundreds of millions of dollars in construction revenue.”??
Labor intends to fight
any move by Wal-Mart to open new stores within Chicago’s city limits.
“It’s clear they
are trying to take advantage of the economic crisis that’s out there and
use that for political leverage,” said Jerry Morrison, executive director
of the Illinois State Council of the Service Employees International Union
(SEIU).
“In an economic crisis, you cannot go on giving people non-subsistence
wages and having the state subsidize their health care.”
Discussion Questions:
Will current economic conditions get Wal-Mart fast-track approval to
build multiple new stores in Chicago? Do Wal-Mart and
other retailers have added leverage
to gain concessions from local and state governments when it comes to
new construction at the present time? How much of a factor is this in
deciding to build?
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The weak economy has given Wal-Mart leverage, not only in opening new stores but with suppliers as well. So this is a no-brainer. When the economy was good, more power was put in the hands of local governments and the anti-Wal-Mart fanatics.
The decision to build has already been made. The next step for Wal-Mart is to continue to squeeze as many dollars as they can from local governments to help finance their ventures. The fact that Wal-Mart has decided to slow its growth has given them more leverage. Kind of a coincidence the economy tanked about the same time Wal-Mart was scaling back its growth.
Lincolnwood Towne Center, North Riverside Mall, the Plaza…every Chicago shopper knows that millions of dollars in sales flow out of the city to nearby suburbs because the neighborhoods are under-stored. It is laughable to claim that Walmart will harm mom-and-pop stores. Those stores pretty much died with the streetcar lines that served neighborhood retail centers like Uptown, West Lakeview, Garfield Park, Englewood and Woodlawn and they have never been replaced. Seriously, drive out Madison west from the Loop. Miles of underutilized commercial property. Wait, you don’t have to drive. Just Google the map location of Madison & Western in Chicago and choose the Street View icon. Move to the West, as far as Austin Boulevard. See anything worth saving from Wal-Mart? No, I didn’t think so.
Though poor, there is still money in those areas and Walmart smells it. Walmart also smells a mayor and aldermen desperate to make up tax shortfalls from the collapse of the commercial and housing market. Think the Spire or Waterview will be completed any time soon? Think that glut of thousands of empty condos will be sold any time soon? No I didn’t think so.
Money talks in Chicago and right now, Walmart is the only one with money. It’s that simple.
This economy allows Walmart nothing but a win. Aside from the intangibles and logistics and sideline necessities which must be performed and completed to move forward with a store in a certain location–which is true for MANY locales–the economic downturn solidifies Walmart’s position with its shoppers and also their relationship with their suppliers. Let’s face it–everyone wants or needs to save in this environment and the suppliers are HAPPY to have a large, dependable, unquestionably ongoing client in their portfolio!
This is no different in the South or West Side of Chicago than it is anywhere else (at least 85% of the rest of the country).
Like them or not–WalMart continues to win. The downturn is awful for everyone including Walmart, however, Walmart will likely be the only beneficiary of the downturn.
If I was running Wal-Mart marketing right now, I would be excited by the opportunity for the company to reinvent itself in the eyes of its detractors. I’d be going back to every community they desired to enter but were stopped, and putting out a hand of cooperation and assistance in helping the area out.
We have seen sales grow with the chain due to its pricing and so therefore in these times, the customer is voting with their pocketbook. Wal-Mart should come to the table with a new image of support for America. Now they have a opportunity to build a new platform, similar to how they started.
You’d hope Chicago would welcome them with open arms. Why let unions dictate what customers want, anyway? That’s a bad idea from the start. Besides, Walmart is by no means the “evil” company many portrayed it to be a mere decade ago (Macy’s destroyed Marshall Field’s, what has Walmart done?) They’ve made tremendous strides on all fronts, including labor. Let’s move on, get retail moving, going in Chicago.
Has anyone ever been to South Side or West Chicago? There’s not much there besides check cashing centers, projects, liquor stores and store-front churches. If Walmart wants to invest in these areas and give people who have few prospects some honest work, why not? I seriously doubt Michigan Avenue or Oak Street has anything to worry about.
Every city, county, state, and federal taxing authority is saying invest dollars, bring jobs and we will support you. Why should Chicago be any different?
With “card check” on the political horizon, Wal-Mart is picking the wrong time to expand into this perpetually difficult labor market.
This is a tough one.
Currently most consumers living in these areas shop with local convenience stores and pay crazy prices in relationship to their incomes. Otherwise, they head downtown and manage parcels on the CTA for the trip home. In the end, the residents will benefit from prices that will stretch already lean household budgets.
The local retailers (aka voters/campaign donors), like local retailers all over Main Street USA, will be forced out.
Like all of the BIG city employers, how will Wal-Mart contribute to Chicago?
This is a tough one with plenty of GOLDEN opportunities. But as we all know, “retail ain’t for sissies.”
The economic environment would seem to indicate a wider opening for Wal-Mart. But a look at the bigger picture shows that a few specific factors could dilute any urgency for opening new Wal-Mart stores. The City Council is heavily entrenched in winning a bid for the 2016 Olympics, and having a labor-friendly local resident in the White House doesn’t help the retailer’s cause either.
While there will be challenges, Wal-Mart clearly has a strong track record of working with disparate parties to resolve similar situations.
This should open up opportunities in a lot of communities that have been hostile to Wal-Mart. There aren’t going to be too many local politicians right now who aren’t going to embrace Wal-Mart bringing in new jobs, regardless of the longer-term implications.
This is Chicago we are talking about here, folks.
The key question is not whether the unions will get shushed in this economy. They will–provided that Wal-Mart has finally connected with the developers who are connected.
Last month almost 600,000 jobs were lost in the U.S. Over the last 3 to 4 months 1,500,000 people lost jobs. One wonders how many members of the SEIU lost theirs. It seems that Mr. Morrison would rather have people out of work than working and making some kind of money. Perhaps, Mr. Morrison believes that anyone who doesn’t belong to his union doesn’t deserve a job.
I hope the Wal-Mart plans get fast tracked in Chicago. We have to stop the bleeding in this economy and this is certainly is a step in the right direction. I can assure a very, very near sighted Mr. Morrison that if these Wal-Mart stores are completed and opened, in spite of that that the number of employed retail workers in Chicago will be less than today and the number of empty retail buildings will continue to grow.
The risk of expanding a retail business in today’s environment is extraordinary. From a retailer’s point of view, if the risk of opening a new store is lessened to the point that they can make a positive decision to enter a market, then whatever institutions can, should provide concessions to lessen that risk.
While it may improve their odds, I sure hope the greater wisdom is evident–that they destroy the fabric of community, disrupt lives, and drive a new economy we can live without. The question is, can Americans be disciplined to live with a little less convenience, and can independent locally-owned retailers step it up enough to satisfy the reasonable expectations of consumers?
Many of them have created their own problem by crying the blues when they have laid down and expected someone to “do something about it,” rather than stepping it up and meeting the demands of their customers.
Wal-Mart is the world’s leading retailer. It provides a lot of savings to the families that need it most. Get over it Chicago!!!
Just don’t roll over. Make sure that you are not providing city services and concessions that are inappropriate to Wal-Mart’s contribution. Too many neighborhoods have been destroyed when Wal-Mart wipes out the mom and pops only to move across town after a few years. If Wal-Mart wants to invest in Chicago’s future, make them stay as a good neighbor for generations, just like the mom and pops have.
Wal-Mart still wants to dominate retail. Struggling Main Street retailers will voice their opposition more strongly than ever since they do not have a seat at the bailout table.
Most any city or town is more likely to grant concessions to builders in this economy. There will be those who will argue that Wal-Mart will create jobs on the one hand and put smaller competitors out of business on the other. Wal-Mart has rehabilitated its image a great deal, but this will still not be a slam dunk. They’ll go through more scrutiny than others might, and the unions will certainly stir the pot and make life more difficult than it has to be. So it’ll be costly, time consuming and difficult, but it’ll happen.
David Livingston wrote something I should’ve realized before–“The fact that Wal-Mart has decided to slow its growth has given them more leverage.”
I’ll expand on it so those who haven’t studied game theory can understand it.
Example–Could the National Football League have a team in every big city?
It probably could. Will it ever have that many teams? No!
If every city that wanted an NFL team had one, the NFL & team owners would have less negotiating power.
Since there’s an NFL-imposed limit on the number of teams, some cities have professional league stadiums but no professional football league teams. The cities are more willing to make concessions to attract teams.
It puts pressure on NFL cities to make concessions to keep teams because an unused or underused stadium is an unattractive prospect.
Even in Wisconsin, The Green Bay Packers inspired the state and some counties to pay for stadium improvements. This is paid for by charging higher sales taxes in those counties.
Will the Packers move out of Wisconsin? It’ll never happen unless enough team stockholders vote for it. Most, if not all, of those stockholders live in WI. (The Packers team is owned by many people instead of one, or a few rich owners.)
Walmart might use its power to get concessions from cities to keep its stores. Some cities already have empty “Wal-Mart” store buildings.
Walmart’s drawing power makes it easy for Walmart to profitably move to nearby cities. There are plenty of suburbs Walmart can move into, if the urban centers don’t make attractive offers when Walmart wants to expand a store. Would Walmart use this “power” to get its way? YES!
I’m somewhat torn on this issue. Walmart hurts people and governments about as much as it helps. I don’t weep for small retailers who don’t run their stores well enough to ward off the Walmart Effect. There are many things small retailers can do to successfully compete against giants like Walmart and Target, and against ogres like Walgreens & Family Dollar.
Though I don’t weep for small retailers, I’m willing to help them. I’ve been writing advice for them for years. I don’t have enough space to write it all here. Google my name & you’ll find my blog/discussion forum.
The standard, valid advice isn’t enough. Small- & medium-sized stores used those cliches well and still fell.
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The weak economy has given Wal-Mart leverage, not only in opening new stores but with suppliers as well. So this is a no-brainer. When the economy was good, more power was put in the hands of local governments and the anti-Wal-Mart fanatics.
The decision to build has already been made. The next step for Wal-Mart is to continue to squeeze as many dollars as they can from local governments to help finance their ventures. The fact that Wal-Mart has decided to slow its growth has given them more leverage. Kind of a coincidence the economy tanked about the same time Wal-Mart was scaling back its growth.
Lincolnwood Towne Center, North Riverside Mall, the Plaza…every Chicago shopper knows that millions of dollars in sales flow out of the city to nearby suburbs because the neighborhoods are under-stored. It is laughable to claim that Walmart will harm mom-and-pop stores. Those stores pretty much died with the streetcar lines that served neighborhood retail centers like Uptown, West Lakeview, Garfield Park, Englewood and Woodlawn and they have never been replaced. Seriously, drive out Madison west from the Loop. Miles of underutilized commercial property. Wait, you don’t have to drive. Just Google the map location of Madison & Western in Chicago and choose the Street View icon. Move to the West, as far as Austin Boulevard. See anything worth saving from Wal-Mart? No, I didn’t think so.
Though poor, there is still money in those areas and Walmart smells it. Walmart also smells a mayor and aldermen desperate to make up tax shortfalls from the collapse of the commercial and housing market. Think the Spire or Waterview will be completed any time soon? Think that glut of thousands of empty condos will be sold any time soon? No I didn’t think so.
Money talks in Chicago and right now, Walmart is the only one with money. It’s that simple.
This economy allows Walmart nothing but a win. Aside from the intangibles and logistics and sideline necessities which must be performed and completed to move forward with a store in a certain location–which is true for MANY locales–the economic downturn solidifies Walmart’s position with its shoppers and also their relationship with their suppliers. Let’s face it–everyone wants or needs to save in this environment and the suppliers are HAPPY to have a large, dependable, unquestionably ongoing client in their portfolio!
This is no different in the South or West Side of Chicago than it is anywhere else (at least 85% of the rest of the country).
Like them or not–WalMart continues to win. The downturn is awful for everyone including Walmart, however, Walmart will likely be the only beneficiary of the downturn.
If I was running Wal-Mart marketing right now, I would be excited by the opportunity for the company to reinvent itself in the eyes of its detractors. I’d be going back to every community they desired to enter but were stopped, and putting out a hand of cooperation and assistance in helping the area out.
We have seen sales grow with the chain due to its pricing and so therefore in these times, the customer is voting with their pocketbook. Wal-Mart should come to the table with a new image of support for America. Now they have a opportunity to build a new platform, similar to how they started.
You’d hope Chicago would welcome them with open arms. Why let unions dictate what customers want, anyway? That’s a bad idea from the start. Besides, Walmart is by no means the “evil” company many portrayed it to be a mere decade ago (Macy’s destroyed Marshall Field’s, what has Walmart done?) They’ve made tremendous strides on all fronts, including labor. Let’s move on, get retail moving, going in Chicago.
Has anyone ever been to South Side or West Chicago? There’s not much there besides check cashing centers, projects, liquor stores and store-front churches. If Walmart wants to invest in these areas and give people who have few prospects some honest work, why not? I seriously doubt Michigan Avenue or Oak Street has anything to worry about.
Every city, county, state, and federal taxing authority is saying invest dollars, bring jobs and we will support you. Why should Chicago be any different?
With “card check” on the political horizon, Wal-Mart is picking the wrong time to expand into this perpetually difficult labor market.
This is a tough one.
Currently most consumers living in these areas shop with local convenience stores and pay crazy prices in relationship to their incomes. Otherwise, they head downtown and manage parcels on the CTA for the trip home. In the end, the residents will benefit from prices that will stretch already lean household budgets.
The local retailers (aka voters/campaign donors), like local retailers all over Main Street USA, will be forced out.
Like all of the BIG city employers, how will Wal-Mart contribute to Chicago?
This is a tough one with plenty of GOLDEN opportunities. But as we all know, “retail ain’t for sissies.”
The economic environment would seem to indicate a wider opening for Wal-Mart. But a look at the bigger picture shows that a few specific factors could dilute any urgency for opening new Wal-Mart stores. The City Council is heavily entrenched in winning a bid for the 2016 Olympics, and having a labor-friendly local resident in the White House doesn’t help the retailer’s cause either.
While there will be challenges, Wal-Mart clearly has a strong track record of working with disparate parties to resolve similar situations.
This should open up opportunities in a lot of communities that have been hostile to Wal-Mart. There aren’t going to be too many local politicians right now who aren’t going to embrace Wal-Mart bringing in new jobs, regardless of the longer-term implications.
This is Chicago we are talking about here, folks.
The key question is not whether the unions will get shushed in this economy. They will–provided that Wal-Mart has finally connected with the developers who are connected.
Last month almost 600,000 jobs were lost in the U.S. Over the last 3 to 4 months 1,500,000 people lost jobs. One wonders how many members of the SEIU lost theirs. It seems that Mr. Morrison would rather have people out of work than working and making some kind of money. Perhaps, Mr. Morrison believes that anyone who doesn’t belong to his union doesn’t deserve a job.
I hope the Wal-Mart plans get fast tracked in Chicago. We have to stop the bleeding in this economy and this is certainly is a step in the right direction. I can assure a very, very near sighted Mr. Morrison that if these Wal-Mart stores are completed and opened, in spite of that that the number of employed retail workers in Chicago will be less than today and the number of empty retail buildings will continue to grow.
The risk of expanding a retail business in today’s environment is extraordinary. From a retailer’s point of view, if the risk of opening a new store is lessened to the point that they can make a positive decision to enter a market, then whatever institutions can, should provide concessions to lessen that risk.
While it may improve their odds, I sure hope the greater wisdom is evident–that they destroy the fabric of community, disrupt lives, and drive a new economy we can live without. The question is, can Americans be disciplined to live with a little less convenience, and can independent locally-owned retailers step it up enough to satisfy the reasonable expectations of consumers?
Many of them have created their own problem by crying the blues when they have laid down and expected someone to “do something about it,” rather than stepping it up and meeting the demands of their customers.
Wal-Mart is the world’s leading retailer. It provides a lot of savings to the families that need it most. Get over it Chicago!!!
Just don’t roll over. Make sure that you are not providing city services and concessions that are inappropriate to Wal-Mart’s contribution. Too many neighborhoods have been destroyed when Wal-Mart wipes out the mom and pops only to move across town after a few years. If Wal-Mart wants to invest in Chicago’s future, make them stay as a good neighbor for generations, just like the mom and pops have.
Wal-Mart still wants to dominate retail. Struggling Main Street retailers will voice their opposition more strongly than ever since they do not have a seat at the bailout table.
Most any city or town is more likely to grant concessions to builders in this economy. There will be those who will argue that Wal-Mart will create jobs on the one hand and put smaller competitors out of business on the other. Wal-Mart has rehabilitated its image a great deal, but this will still not be a slam dunk. They’ll go through more scrutiny than others might, and the unions will certainly stir the pot and make life more difficult than it has to be. So it’ll be costly, time consuming and difficult, but it’ll happen.
David Livingston wrote something I should’ve realized before–“The fact that Wal-Mart has decided to slow its growth has given them more leverage.”
I’ll expand on it so those who haven’t studied game theory can understand it.
Example–Could the National Football League have a team in every big city?
It probably could. Will it ever have that many teams? No!
If every city that wanted an NFL team had one, the NFL & team owners would have less negotiating power.
Since there’s an NFL-imposed limit on the number of teams, some cities have professional league stadiums but no professional football league teams. The cities are more willing to make concessions to attract teams.
It puts pressure on NFL cities to make concessions to keep teams because an unused or underused stadium is an unattractive prospect.
Even in Wisconsin, The Green Bay Packers inspired the state and some counties to pay for stadium improvements. This is paid for by charging higher sales taxes in those counties.
Will the Packers move out of Wisconsin? It’ll never happen unless enough team stockholders vote for it. Most, if not all, of those stockholders live in WI. (The Packers team is owned by many people instead of one, or a few rich owners.)
Walmart might use its power to get concessions from cities to keep its stores. Some cities already have empty “Wal-Mart” store buildings.
Walmart’s drawing power makes it easy for Walmart to profitably move to nearby cities. There are plenty of suburbs Walmart can move into, if the urban centers don’t make attractive offers when Walmart wants to expand a store. Would Walmart use this “power” to get its way? YES!
I’m somewhat torn on this issue. Walmart hurts people and governments about as much as it helps. I don’t weep for small retailers who don’t run their stores well enough to ward off the Walmart Effect. There are many things small retailers can do to successfully compete against giants like Walmart and Target, and against ogres like Walgreens & Family Dollar.
Though I don’t weep for small retailers, I’m willing to help them. I’ve been writing advice for them for years. I don’t have enough space to write it all here. Google my name & you’ll find my blog/discussion forum.
The standard, valid advice isn’t enough. Small- & medium-sized stores used those cliches well and still fell.