Skip to content

Street Talk

Walmart: No Real Growth. Documented

By Mickey Howley

“Baby, I got my facts learned real good right now . You better get it straight darlin’– Poor man wanna be rich, rich man wanna be king. And a king ain’t satisfied ’till he rules everything.”
From the song Badlands, the album Darkness on the Edge of Town by Bruce Springsteen.
When I first heard the news it was like a hard sucker punch in the gut. Pray dear Lord it ain’t true. Maybe a bad and late April Fool’s joke. Walmart coming to town. A darkness on the edge of town.
Why the gut churning despair? Because they are the killers of the dream. The dream Water Valley was known for in the beginning and now being known for again. The dream that you can own a business and pass it on to family, friends, co-workers–you see that here on Main Street now in auto parts, the drug store, the newspaper, the bank, the hardware store, and new folks who live here can have the same dream.
And why is Walmart suddenly coming now?—are we miraculously that good and that attractive and that growing? No. The answer is not optimistic at all.  We’re selected because we’re easy crumb pickings in a mega race for more profits. You see last year Walmart pulled in 420 billion dollars from their 11,000 stores. In Oxford alone 99 million dollars. But that 420 billion take was 1.7% lower than the year before. The CEO needs to justify his $28 million pay.         Their Wall Street stockholders are not happy. They like aggressive returns no matter the costs.  Walmart is an overly aggressive company, always has been–not going for market share, but to kill competition. And now they’re going for the real small fish to extract a higher percentage of profit. We’re part of their new profit plan. Their profit, not ours.
Here’s a tale of two guys who are very similar. But critically different.
Sam Walton was born in Oklahoma in 1918. After serving in the Army in World War II—he stayed stateside—he opened a Ben Franklin store in Newport, Ark. Newport is on the west edge of the Arkansas Delta and is a Water Valley size town. He did really well his first three years. And then his landlord would not renew his lease and took over his business. Sam was truly wronged. Sam moved to Bentonville in the Ozarks and relentlessly went after business and downtown merchants, setting up stores outside of downtown at crossroads and in fields. And when he died 22 years ago, there were almost 2,000 Walmarts. There are 11,000 now.
Sam Walton’s legacy is cheap China goods, dead downtowns, low paying jobs.  Maybe not all Mr. Sam would have wanted, but mega growth and Wall Street returns have overruled all other concerns.
The Sam Walton effect has been stunning. In Walmart’s ever evolving business model they have gone from being a 5&10 and dry goods store, to selling auto parts and tires, to being garden centers, to in-store pharmacies, to having optometrists, to mega grocery stores, to even gas stations, and beyond retail to semi-wholesalers (Sam’s Clubs).
Decimating local owned businesses—the small dress shops, the pharmacies, the local gas station, the local auto parts, the grocery store, the garden store. And the sad part is it is a zero sum game for practically all small towns. No real growth. Documented.
Paul Parker is the other guy. Born near the Louisiana line in Amite County, Paul moved as a young man to York, Ala. He leased a storefront and set up a 5&10 business. But a lease issue much like Sam Walton had forced Paul to leave York and move to Water Valley. He opened a Ben Franklin store. In World War II he was in the Army and served overseas in Germany. He came back to Water Valley and prospered. He knew Sam Walton and had a chance to go in business with him in the 1960s when Sam’s business model was first pretty clear.
Mr. Paul did not and always said, for surely he would have been a multi-millionaire, he had “zero regrets” for not going in business with Sam Walton. Let’s be clear–Paul Parker was a sharp businessperson. He was driven by profit but he wasn’t greedy and deeply cared for this community. Many of you know Mr. Parker died 2 months ago. He was as iconic a business figure as we have ever had. I have to think he’d still be telling Sam no and still having zero regrets. Let’s pray there are still folks here who learned from Mr. Paul’s wisdom.

Leave a Comment