Wal-Mart's Neighborly Approach
Saturday, March 24, 2007
The new Wal-Mart in Landover Hills doesn't sell alcohol or guns. It does have skylights to cut down on energy use. It does not operate 24 hours.
Such concessions were unheard of at Wal-Mart's cookie-cutter stores several years ago. But they are just a few of the compromises the world's largest retailer reached with Prince George's County residents and community leaders concerned about the store's impact on the neighborhood.
It's a new way of doing business for the company, whose hopes for domestic growth lie in conquering urban areas such as Landover Hills, where it has faced strong opposition from labor unions and small businesses. The store symbolizes how far Wal-Mart was willing to go to gain a foothold inside the Beltway.
The battle mirrors those that occurred in other big cities, like Chicago, when Wal-Mart tried to move in. Mom-and-pop stores worry that they will be unable to compete with Wal-Mart's cutthroat prices. Labor organizations fear the non-unionized retailer would depress wages and benefits in the region. Political leaders are divided between the jobs that a Wal-Mart brings -- more than 11,000 people applied for the 330 jobs in Landover Hills -- and the concerns of their constituents.
"People are not convinced at this point," said Adam Ortiz, mayor of nearby Edmonston, who helped negotiate with Wal-Mart. "Some are very excited. Some aren't sure if this new approach is for real."
Wal-Mart was founded by Sam Walton as a five-and-dime store in Bentonville, Ark., where it still keeps its headquarters. It grew into a national powerhouse by flooding rural areas with huge stores and low prices on everyday goods. But as Wal-Mart has saturated the country, sales growth has slowed. At U.S. stores open at least a year, sales grew 0.4 percent in February compared with last February.
The Wal-Mart name was the most recognized among a list of 15 major companies in a 2005 survey by the Pew Research Center. Ninety-one percent of people responding to the survey said they lived within shopping distance of a Wal-Mart, and 84 percent had been to a store in the past year.
Wal-Mart has become a victim of its own success.
Urban areas are the country's last frontier for the retailer, though they can be fraught with peril. Wal-Mart's first store in Chicago triggered racial tensions and prompted a heated political debate over a living-wage bill aimed at the retailer. The Landover Hills store is particularly significant because of its proximity to the nation's capital, where Wal-Mart has become an influential lobbyist.
Wal-Mart promised that this store would be different. Merchandise is tailored to the area's demographics. There are expanded gospel and Latino music sections, where a CD by 3 Gallos Jugados sells for $9.96. The store carries Wal-Mart's urban apparel line, Exsto, but scaled back the fishing equipment in the sporting-goods department.
"We have worked very closely and very well with the Landover Hills community to build this store," company spokesman Steven Restivo said. "We have worked hard to meet their needs -- and will continue to do so."
Wal-Mart spent nearly two years negotiating with residents and community groups to adopt nine standards covering what it can sell (no alcohol, guns or ammunition) and how the store would be built (an earth-tone facade and environmentally friendly). Wal-Mart also agreed to meet regularly with local leaders to check on the store's progress and address new problems.