 A
man of modest beginnings, Sam Walton built the Wal-Mart empire into
the number one retailer in the world on a simple, but groundbreaking
rule, cut all excess costs and sell low.
Although many
have applauded his business mind and the Walton Family's philanthropic
endeavors, Wal-Mart has also been criticized for enforcing bad
labor practices and driving out mom-and-pop shops and wreaking
environmental havoc due to the size of the stores. But the retail
giant it was to become got its start in Walton's humble goal of
making goods more affordable to rural America.
History
and Growth of Wal-Mart
Walton
was born in Kingfisher, Okla. on March 29, 1918. While attending
the University of Missouri at Columbia, Walton delivered papers,
waited tables and worked at a five-and-dime store.
In 1945 with
a $25,000 loan from his father-in-law, Walton opened his first
store -- a Ben Franklin arts and craft store in Newport, Ark.
Walton and his brother, James, owned 15 Ben Franklin franchises
by the early '60s.
Walton thought
he could bring lower prices to rural towns and proposed to open
bigger stores in those areas, but his suggestion was turned down
by Ben Franklin executives.
Acting on
his vision of providing inexpensive goods to small-town markets,
Walton soon opened his first Wal-Mart in 1962 in Rogers, Ark.
By 1977, Illinois
became the tenth state to have a Wal-Mart. By 1991, a year before
Walton's death, Wal-Mart first opened an international store in
Mexico City.
As of July
2004, Wal-Mart had 1,409 stores in the United States, 1,562 Supercenters
(a Wal-Mart and grocery store combined), 539 Sam's Clubs (a warehouse
discount store) and 1,506 international Wal-Mart stores. It was
also the largest private employer in the United States.
Walton's
Way
No stranger to hard work, Walton took a hands-on approach to management.
"This
is a man who was at work at 4:30 in the morning, had warmth and
charm throughout the day, an interest in his customers, and who
treated his associates well as persons, not just as clerks and
salespeople," said Walter Loeb, a retailing consultant, according
to The New York Times.
Walton, known
as an enthusiastic leader, was constantly looking for new locations
for his revolutionary discount store. The tycoon would sometimes
fly over small towns looking for new locations -- landing and
buying a slab of land when he found the perfect spot. After his
company grew much larger, Walton would fly to his stores to check
on them.
Part of Walton's
enthusiasm could be recognized with the cheer that he started
and that is repeated at the beginning of every workday by the
employees at each store --
Give me a
W!
Give me an A!
Give me an L!
Give me a Squiggly!
Give me an M!
Give me an A!
Give me an R!
Give me a T!
What's that spell?
Wal-Mart!
Whose Wal-Mart is it?
My Wal-Mart!
Who's number one?
The
Customer! Always!
Walton had
visited a tennis ball factory in Korea where the employees did
calisthenics and a company cheer together, Walton liked the idea
so much he encouraged his employees to do the same.
"My feeling
is that just because we work so hard, we don't have to go around
with long faces all the time -- while we're doing all of this
work, we like to have a good time. It's sort of a 'whistle while
you work' philosophy, and we not only have a heck of a good time
with it, we work better because of it," Walton said, according
to the company.
What Sam Walton
developed was a complete philosophy of business, one he outlined
in his autobiography, "Made in America: My Story."
 One
of them in particular, value your associates, was something that
would revolutionize retail. Ironically in the years following
Walton's death the treatment of Wal-Mart employees was scrutinized.
Accusations of forcing employees to work overtime without pay,
locking them in the store and discrimination have brought law
suits and media attention.
But Walton,
who referred to his employees as associates to increase their
stake in the company, worked to make some workers eligible for
a share of the profits and stock options in the company. Associates
also manage their own departments, keeping a watchful eye on stock
and profits.
Because Walton
strived to drive prices as low as he could, he would cut as much
overhead as he could, driving prices even lower.
This practice,
which brought his customers the lowest prices, however, led to
complaints against the company for driving out smaller factories
that couldn't produce goods at the lower prices Wal-Mart, the
United States' largest private employer, demanded.
Wal-Mart
Legacy
When
Sam Walton died in 1992 he was the richest man in America, holding
38 percent in his company now worth more than $20 billion. Sam
Walton's widow, Alice, and their four children hold the sixth
through tenth spot on Forbes' list of the world's richest, each
worth an estimated $20 billion.
The family,
the nation's wealthiest, has also become the top philanthropist
in the United States, especially in the area of education. They
have contributed at least $701 million to education charities
since 1998, according to USA Today.
But even their
philanthropic efforts have become controversial. Critics argue
the money the family puts toward voucher programs may push more
tax money to charter schools, which are less regulated than public
schools and would also take money from the public schools.
Nonetheless,
John Walton, one of Sam Walton's children, told USA Today that
the family expects to donate as much as 20 percent of their $100
billion in Wal-Mart stock.
--
By Sheryl Silverman, Online NewsHour
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