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Learning from Wal-Mart
TownHall ^ | 02.24.06 | Edwin J. Feulner

Posted on 02/25/2006 4:37:19 PM PST by Coleus

Anyone who's ever filed a tax return or visited the Department of Motor Vehicles understands that government does two things well: spend our money and waste our time. Unfortunately, both traits were on display during the response to Hurricane Katrina. A House select committee headed by Rep. Tom Davis, R-Va., says the government displayed "fecklessness, flailing and organizational paralysis." The committee report lays out 90 flaws in the Katrina response and notes that all levels of government failed. Oh, plenty of money was going out. Last September, the federal government was spending about $1 billion per day -- and it generated plenty of waste. The Federal Emergency Management Agency handed thousands of checks (for $2,000 each) to charlatans.

FEMA also wasted money on housing. It spent $236 million to rent three cruise ships for evacuees. The ships were never more than half full. And don't forget the manufactured homes, some 10,777 of which are rotting away in Arkansas because FEMA ordered more than it needed. As Sen. Susan Collins, R-Maine, explained, the waste happened because the government took a "pay first, ask questions later" approach. The federal government has promised to fix its problems. Michael Chertoff, secretary of Homeland Security, says he'll deliver "a fully integrated and unified" department before the next hurricane season. Fine. But let's remember, not all answers can be found in Washington.

It would be better to look toward an institution that didn't fail during Katrina: Wal-Mart.

The world's largest retailer had 171 facilities in the path of the storm. But as Jason Jackson, the company's director of business continuity, told a Senate committee, "We were able to recover and reopen 83 percent of our facilities in the Gulf area within six days." One key reason for Wal-Mart's success, Jackson said, is "associates who are dedicated to their communities." That local connection helped it deliver goods when government failed. As Investor's Business Daily reported in September, "While local and federal groups suffered communications problems and bickered over who was in charge, Wal-Mart sprang into action."

And while Chertoff admits Katrina caught the government flat-footed, Wal-Mart is always ready. In his book "The World is Flat," New York Times columnist Thomas Friedman wrote, "The minute Wal-Mart's meteorologists tell headquarters a hurricane is bearing down on Florida, its supply chain automatically adjusts to a hurricane mix in the Florida stores." That means plenty of non-perishable food and critical items such as generators appear in stores even before disaster strikes.

Wal-Mart has plenty to teach the government. "When FEMA or another agency places a blanket order of 100 trailers of water, we often question if the person placing the order really knows what 100 trailers of merchandise looks like," Jackson testified. "Usually the answer to this is that the person making the order was given a dollar amount to spend, and they do not comprehend the size of this order or what it means."

Wal-Mart does what government intervention can't: It drives down prices and makes life better -- in New Orleans and, soon, in Chicago. The company opened a store last month in Evergreen Park (where I was born), after the city council refused to allow it inside the city limits. Some 25,000 people applied for the store's 325 jobs, which suggests Wal-Mart is popular with employees as well as consumers. After Katrina, even Wal-Mart's critics sang its praises. "It's hard to imagine any government program matching the efficiency of a Wal-Mart," wrote consulting firm Lynch Ryan on its Weblog, adding, "Government has a lot to learn from Wal-Mart." Unless we change our approach -- bringing in more private, local expertise and less federal bureaucracy -- we'll be reminded of that the next time disaster strikes.

Dr. Edwin Feulner is president of The Heritage Foundation, a Townhall.com Gold Partner.



TOPICS: Business/Economy; Government; US: Louisiana
KEYWORDS: fema; feulner; katrina; nola; tomdavis; walmart
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1 posted on 02/25/2006 4:37:23 PM PST by Coleus
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Comment #2 Removed by Moderator

To: 4butnomorethan30characters
Yeah, I'd much rather pay $50 for a pair of pants, than $15. Those small town retailers really knew how to serve the customer. Of course, they wouldn't stock what you wanted, nor have anything at a reasonable price. But they were local.

Boulder, Colorado made a law that no big box stores could locate there. Well, they all went to Louisville, Lafayette, or Longmont. Now those cities get the sales tax revenue. And they created jobs that weren't there before at all. Those people moving in created other jobs and opportunity for other businesses.

Are you a "change is bad" type person? If a smaller retailer can't make it, well, I bet the owner is not starving and has found something else to do.
3 posted on 02/25/2006 5:00:56 PM PST by clb (get over it)
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To: 4butnomorethan30characters
They've taken customer service to an all-time low

Have you even shopped at Wal-Mart? If I ask where something is, the salesperson will walk me to it, rather than just pointing, even if it is in another department. When I return something, I get the money back with no hassles. If I want name brand soft drinks, they'll sell them cheaper than Safeway, Kroger, or Albertsons, or give me the option of store brand at 50 cents for 2 liters.

and have driven many US companies out of business

So the Kellogg's cereal sold by Wal Mart is made in a different company than the Kellogg's cereal sold at a local IGA store?

4 posted on 02/25/2006 5:14:46 PM PST by PAR35
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To: 4butnomorethan30characters
Did you know that our military exchanges sell the exact same merchandise that Walmart does?
5 posted on 02/25/2006 5:17:28 PM PST by CWOJackson
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To: 4butnomorethan30characters
That's been my experience with Wal-Mart as well - the customer service is sorely lacking, the stores are dirty and most of their products (especially clothes)are of poor quality. Sometimes it's true that you get what you pay for. Of course this isn't just Wal-Mart but most "big-box" stores. The last time I asked for assistance purchasing supplies at Home Depot I couldn't find anyone who was both willing and able to answer my question. It's worth it to me to pay a bit more for good, dependable service.
6 posted on 02/25/2006 5:36:36 PM PST by asburygrad
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To: Coleus

"feckless" Now there's a word I'm tired of hearing. It was in my last job review 14 times.


7 posted on 02/25/2006 5:46:41 PM PST by KarinG1 (Some of us are trying to engage in philosophical discourse. Please don't allow us to interrupt you.)
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To: 4butnomorethan30characters

Then don't shop there then. Simple as that.


8 posted on 02/25/2006 5:47:41 PM PST by Extremely Extreme Extremist (We're Americans, we can do anything)
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To: 4butnomorethan30characters

Sure they have problems but what the article was pointing out was that immediately before and after the storms they were organized, efficient and quickly on the spot whereas FEMA, state and local governments couldn't figure out their head from their butt. The government still hasn't figured out which end is up.


9 posted on 02/25/2006 6:07:05 PM PST by CajunConservative (Don't Blame Me, I Voted for Jindal.)
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To: asburygrad; 4butnomorethan30characters

Got to wonder how you know all this stuff about Wal Mart. Sounds like closet shoppers to me. Bet you saved a bunch when you shopped there.


10 posted on 02/25/2006 6:12:00 PM PST by taxesareforever (Government is running amuck)
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To: asburygrad

I once went into a 24 hour walmart looking for something late at night. Couldn't find what I wanted so I proceeded to search for an employee. Couldn't find anyone despite wandering around half the store. I did however pick up 3 security types who were watching to see if I was trying to steal something.

One of the ways walmart beats prices of the smaller companies is through buying in bulk, extremely good business processes and excellent IT systems. They also abuse their employees and force suppliers to cut the quality of the products. Thats why walmart clothes fall apart so much faster than something purchased for a few dollars more. Part of a free market is the consumer has a choice of where to spend their money. Only suckers think a low price is the only consideration when making a purchase.


11 posted on 02/25/2006 6:31:27 PM PST by driftdiver
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To: driftdiver
There is a culture that forments WalMart hatred. Those that ran or were close to someone that ran a business that WalMart outmarketed out of business is a surprisingly small group. The numbers of businesses the were driven out of business by WalMart is, in large part, an urban myth. Yes, small businesses do fail and sometimes in response to competition. But the wholesale closing of small businesses in the wake of WalMart coming to town simply is NOT the case. Check the U.S. Chamber of Commerce for their figures.

So that brings us to the other reasons to hate Walmart. "They pay nothing to there employees." Gee, 25,000 applicants for less than 350 jobs belies that. Also WalMart tends to retain their employees as long or longer then the average business that hire mostly entry level, unskilled labor. Hmm, wonder why they stay?. Mainly because WalMart promotes from within. Story after story from WalMart employees telling how they came as an unskilled HS graduate and got the training to manage stores, transport, regions as well as many other mid and upper level managment positions.

All of this, notwithstanding, some will continue to hate WalMart. Closed minds on this subject abounds. My advice? Shop somewhere else.

BTW, I do not and have never wqorked for Walmart, but I DO shop there and Sam's Club. I have never had rude or substandard customer service, but I do leave the store with more money in my pocket then I used to before WalMart came to town.

13 posted on 02/25/2006 7:32:13 PM PST by Wingy
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Comment #14 Removed by Moderator

To: asburygrad
That's been my experience with Wal-Mart as well - the customer service is sorely lacking, the stores are dirty and most of their products (especially clothes)are of poor quality. Sometimes it's true that you get what you pay for.

Must be the part of town you live in.

Our Wal-Marts are clean, well organized, the staff is extremely helpful, and most of the products are the EXACT SAME BRAND-NAMES sold elsewhere, just as far lower prices.

You can go pay $35 for a pair of Dockers, while I pay $17 at Wal-Mart for them.

15 posted on 02/25/2006 7:37:52 PM PST by Jorge
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To: driftdiver
I can't get over this politization of Walmart. It is a store, not a political issue.

However, back to the article. I do think, based on my own, now extensive hurricane experience, that the government should not try to do what Walmart does or learn from them, but it should rely on the merchants to do some things. They can't really plan the relief, because noone knows where a hurricane will hit. So, although they may have trucks with water and ice in staging areas, it takes a while to get distribution centers designated and up and running. Meanwhile, the grocery stores where we normally get things are open for business.

For a solid week they commandeered the radio to tell how we could get free ice and water. I saw a line of cars that stretched for miles, but I drove by it and went to the store and bought ice for $1.29. There was nothing about the hurricane that made this unaffordable. So the government can skip the ice, as far as I am concerned. Likewise, they had this complicated go to the courthouse to get a blue tarp, or, by the way, they have them at Home Depot.

There are some people who have mega problems, and I think they should concentrate on helping them.

16 posted on 02/25/2006 7:40:06 PM PST by ClaireSolt (.)
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