Wal-Mart’s Wages Increase in China, Rollback in US

I find your analysis quite misleading, Mr. Nassar, on several points.

Perhaps you are easily misled?

Statistically and factually ‘Someone’, you are not misled. You are however, typically and usually just plain stupid. But this trait of yours comes not from any claimed ability you have in ‘analysis’ of anything but rather the deliberate and meaningless drivel you post attempting to be something other than a WalMart internet ass kissing troll.

“Everything has its limit - iron ore cannot be educated into gold.”
Mark Twain

So, while the price of gas, food and health care are rising, Wal-Mart employees’ wages are falling.

Wrong.

So, because the price of gas, food and health care are rising, Wal-Mart employees’ real wages are falling.

Correct. Also, is this true across the industry? Across all industries?

In light of the fact that “full-time” work for Wal-Mart employees is often 34 hours a week, this means the “average” hourly worker earns only about $19,200 annually.

He is right to use “average” in quotes, but not in the way he is thinking. The average hours worked by FT associates is obviously more. Also, you can’t use averages of either of these numbers to tell you much, good or bad, about the average FT associate.

family of four

Why try to support a family of four on a single income from an entry-level job? Also, what percentage of associates are trying to do this? How many are in college, or have a two-income household, or no kids, etc.?

it is no wonder that Wal-Mart employees top the public assistance rolls

By percentage of people employed or total numbers? Wal-Mart is often the largest employer in a state. Also, this doesn’t follow from his previous statements.

The company was again crowned the largest company in the world by Forbes

Evidence that the union smear campaign has failed. It also explains the desperation underlying many the posts and comments on this blog.

Wal-Mart can and should do better for its 1.4 million U.S. workers

Wal-Mart is the largest company in the world by revenue, but its profit margin is razor thin. Mr. Nassar would have to see the books to know exactly what Wal-Mart could do.

David, the floor is yours.

American consumers squeezed by surging inflation
By James Quinn, Wall Street Correspondent
Last Updated: 1:09am BST 18/07/2008

The already struggling US economy took another turn for the worse after it emerged that American consumers are experiencing a period of “intense” inflation after prices soared at the fastest annual rate in 17 years on the back of the rising price of oil and food.

The US consumer price index rose 5pc on a year-on-year basis, its highest rate since May 1991, a rate more than douible the US government’s 1.5pc-2pc target range.

Prices jumped 1.1pc in June, the second highest increase since 1982 - and the highest since 2005 during the aftermath of Hurricane Katrina. Stripping out food and fuel costs, inflation rose by 0.3pc.

The inflation numbers were compounded by a separate US Labour Department report that showed that salaries are declining. The average weekly earnings of US workers fell 0.9pc in June on an inflation-adjusted basis

The news is the latest blow to the American economy, which has already seen more than 1m homes repossessed as a result of the sub-prime mortgage scandal and unemployment at 5.5pc.

Federal Reserve chairman Ben Bernanke yesterday acknowledged that US inflation “is too high”, adding that it is likely to go higher when he admitted that “upside risks to the inflation outlook have intensified”.

The head of the US central bank added: “It’s a top priority of the Federal Reserve to run a policy that is going to bring inflation to an acceptable level consistent with price stability.”

Speaking before the House Financial Services Committee during the second day of questions on his semi-annual economic state of the nation report, Mr Bernanke also admitted that there is little the Fed can do about the factors causing growing inflation pressures.

He said the rising price of oil and other commodities was due to “factors out of the control of the Federal Reserve”. “The only silver lining to these high prices is they induce lots of incentives to conserve, incentives to provide alternatives, incentives to find and develop other oil sources,” he added.

In an apparent about-turn, Mr Bernanke said that there are “significant downside risks” to the outlook for growth. His comments were a move away from the Fed’s assessment at the meeting of its FOMC rate-setting committee at the end of last month, when it said that risks to growth had diminished.~~~~~~~~~~~~~~~~~~~~~~~~~NOTE:The inflation numbers were compounded by a separate US Labour Department report that showed that salaries are declining. The average weekly earnings of US workers fell 0.9pc in June on an inflation-adjusted basis .~~Did anyone dicuss the effect of inflation on these wages at WalMart?

“Sadly, wages for the average hourly U.S. Wal-Mart employee have actually fallen when adjusted for inflation.”

“This is all happening in the context of an American economy that continues to decline while Wal-Mart’s revenue continues to rise higher than ever.”

“Instead of perpetuating a cycle of poverty among its workers with a low wage, poor benefit business model, it is time Wal-Mart consider a meaningful wage increase for its hourly U.S. employees who are struggling just to make ends meet for their families. Wal-Mart can and should do better for its 1.4 million U.S. workers.”

David Nassar

Translation of insight and ‘analysis’ from ‘Someone in USA as follows…

I don’t understand inflation and its relationship to falling wages. I really don’t want to accept the facts that David Nassar put forward, it embarrasses WalMart my socially retarded employer.

People who work at WalMart should not be allowed to have families and it is obvious by the amount of money that they are paid for working there every day.

Forget about WalMart being the largest abuser of public health care in the United States for any corporation or the top abuser in 23 states. The Walton family multi-billionaires don’t give a shit about their WalMart employees health care or wages and if that is not clear then don’t look at other retailers like Costco where 90-92% of employees health care is totally covered and the average wage is $17/hr.

Mr. Nassar would have to see the books to know exactly what Wal-Mart could do. In my dream world of not wanting anyone to look at a socialy responsible employer and business model like Costco that does for its employees every day what WalMart and the Walton billionaires WON’T do for theirs.

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Even as the floor hits you in the face again ‘Someone’, other retailers are not based on the Sam Walton ideology of manipulation and exploitation of labor-

Wal-Mart founder Sam Walton once said, “I pay low wages. I can take advantage of that. We’re going to be successful, but the basis is a very low-wage, low-benefit model of employment.”
http://en.wikipedia.org/wiki/Criticism_of_Wal-Mart#_note-
iswalmartgood

“Is Wal-Mart Good for America?” PBS. November 16, 2004. Retrieved on February 24, 2007.

“The righteous considereth the cause of the poor: but the wicked regardeth not to know it.”
Proverbs 29:7

It also explains the desperation underlying many the posts and comments on this blog.

Enough said, Someone…

It also explains the desperation underlying many the posts and comments on this blog....by Ex and current WalMart associates . I think the Minnesota case of two million wage violations and the treatment of women being forced to soil themselves is desperately inhumane-AND THE JUDGE DEEMED IT SO...ABERRANT. The Pro side has remained mute. Not a peep .

Someone,

“Why try to support a family of four on a single income from an entry-level job?”

In today’s economy, it is hard for anyone working at any ‘blue collar’ job, to support a family of four on a ‘single’ income!!  That’s why MOST families are two income families!!

That’s why MOST families are two income families!!

And that’s why we call the current economic condition a ‘race to the bottom’. Wal-Mart, more than any other entity, is exploiting this weakness of ‘globalization’.

Let’s not bring the developing countries up, let’s bring the developed countries DOWN!

What’s good for Wal-Mart is BAD for America!

Ken V,

“And that’s why we call the current economic condition a ‘race to the bottom’”

I think the ‘race to the bottom’, has more to do with the intelligence level of the average American from ‘poor’ education in our public schools, than anything else!!

I blame it more on work ethic.  When Americans want to do one tenth of the work for ten times the pay, it’s going to be tough to keep the jobs here.

‘Dave’, your misrepresentation of the American worker bears out signature of the traditional fake person WalMart internet fraud and should require of the WalMart/Edelman public relations ‘war room’ to redesign you as something other than a species of Arkansas RDS hick.

U.S. Productivity Increases 1.8%, More Than Forecast (Update2)

By Shobhana Chandra

Feb. 6 (Bloomberg)—Worker productivity in the U.S. grew more than forecast in the fourth quarter as companies cut employees’ hours at the fastest pace in almost five years.

Productivity, a measure of employee efficiency, rose at an annual rate of 1.8 percent, after a 6 percent pace in the third quarter, the Labor Department said today in Washington. The median forecast in a Bloomberg News survey was for a 0.5 percent gain. Labor costs rose less than forecast, the figures showed.

Businesses are trimming staff to control expenses as the economy hovers on the verge of the first recession since 2001. That may help keep consumer prices in check, giving Federal Reserve policy makers more leeway to lower interest rates, economists said.

``Productivity still looks fairly healthy and labor costs are tame,’’ said James O’Sullivan, a senior economist at UBS Securities LLC in Stamford, Connecticut. ``This gives the Fed more flexibility to respond to weakness in growth. It certainly looks like there is more easing to come.’’

The median forecast for productivity was based on 71 estimates in a Bloomberg News survey. Projections ranged from a drop of 0.6 percent to a gain of 2.7 percent.

Treasury notes, which had fallen earlier in the day, stayed lower after the report. Ten-year yields advanced to 3.59 percent from 3.57 percent late yesterday.

Labor Costs

Unit labor costs, which are adjusted for gains in efficiency, rose 2.1 percent after dropping 1.9 percent in the prior three months. Economists in the Bloomberg survey had projected a 3.5 percent increase.

Hours worked dropped at a 1.5 percent pace, a second consecutive decline and the biggest since the first three months of 2003.

Compensation for each hour worked increased at an annual rate of 3.9 percent, compared with a 4 percent gain the prior quarter.

Productivity for all of 2007 rose 1.6 percent after increasing 1 percent the previous year. Labor costs rose 3.1 percent, the most since 2000.

Productivity at non-financial corporations, a measure watched by former Fed Chairman Alan Greenspan, rose at a 3.7 percent rate in the third quarter after rising 2.1 percent in the prior three months. The figures are released with a one- quarter lag.

Among manufacturers, productivity increased at a 2.5 percent pace last quarter, following a 4 percent gain.

Productivity gains may be harder to come by as the economy weakens because businesses are usually slow to reduce staff, economists said.

Slower Growth

Economic growth slowed to an annual rate of 0.6 percent in October through December, down from a 4.9 percent pace in the third quarter, according to government figures last week. A report from the Institute for Supply Management yesterday showed service industries unexpectedly contracted in January at the fastest pace since the 2001 recession.

Still, some businesses have already reacted to the demand slowdown. Companies added 1,000 workers to payrolls in January, while government agencies reduced staff. The economy lost 17,000 jobs overall, the first decline in more than four years. Hourly wages rose 0.2 percent last month, less than economists had forecast.

Labor expenses account for about two-thirds of the cost of producing a good or service.

Rate Cuts

Less growth and fewer price pressures will allow Fed policy makers to keep cutting interest rates, economists said.

Central bankers lowered the benchmark rate by a half point on Jan. 30, following an emergency three-quarter-point reduction the prior week. Investors are betting on another half point at or before the next meeting in March, according to futures trading.

Some economists are concerned the productivity surge that began in 1996 is waning. Efficiency increases slowed every year from 2002 to 2006. Last year’s 1.6 percent gain compared with an average increase of 2.5 percent since 1995.

In the late 1990s, Greenspan was one of the first to recognize that productivity was accelerating, and that the improvement could help contain inflation even as the economy strengthened and unemployment stayed low. The realization allowed the Fed to keep interest rates little changed from 1996 to 1999. bloomberg.net.

American workers are the most productive on the earth. Maybe the internet slacker fraud ‘Dave’ can someday figure that out.

When Americans want to do one tenth of the work for ten times the pay...

You’re referring to CEOs, right Dave?

Had the minimum wage risen as fast as CEO compensation since 1990, the researchers calculated, it would now be $23.03 an hour instead of just $5.15. And the average production worker would be making $110,126 a year instead of $27,460.

And that was as of 2005..(click on my name for the source)

SDV,

“Productivity, a measure of employee efficiency, rose at an annual rate of 1.8 percent.....Compensation for each hour worked increased at an annual rate of 3.9 percent”

Seems, according to your own presented figures, the employee compensation rate increase (3.9%), was over double the efficency rate of (1.8%)!!

“Labor expenses account for about two-thirds of the cost of producing a good or service.”

Sounds like that only leaves 1/3rd to cover overhead, profits and other expenses!!  Seems that labor gets the lions share!!

Improved efficiency numbers do not mean that the people are working harder.  With technological advancements and people finding better ways of doing things, we should be able increase productivity.  It’s amazing that there are still people out there trying to say that Americans work hard.  I know there are some that do, but they are few and far between.  As far as me being a “fake person internet fraud,” you’re a little paranoid there buddy.  Especially since workers being lazy has nothing to do with Walmart being good or bad.  It has more to do with the problems with America than it has to do with Walmart, but you can think what you want.  Keep blaming the problems with America on everyone else instead of blaming it on the public at large who has contributed to it as much as any public figure or corporation.

Barely disguised WalMart drivel again Dave to not pay labor a decent wage like the workers receive over at Costco. Those better wages yield better productivity at Costco that put WalMart to shame again-

The Payoff of Better Pay-

Strong union representation isn’t the only reason Costco jobs are so well compensated; the company itself has an unusually forward-looking corporate philosophy.

Costco CEO Jim Senegal has said: “We pay much better than Wal-Mart. That’s not altruism. It’s good business.”

Chief Financial Officer Richard Galanti explained: “From day one, we’ve run the company with the philosophy that if we pay better than average, provide a salary people can live on, have a positive environment and good benefits, we’ll be able to hire better people, they’ll stay longer and be more efficient.”

A 2004 Business Week study ran the numbers to test Costco’s business model against that of Wal-Mart. The study confirmed that Costco’s well-compensated employees are more productive.

The study shows that Costco’s employees sell more: $795 of sales per square foot, versus only $516 at Sam’s Club, a division of Wal-Mart (which, like Costco, operates as a members-only warehouse club). Consequently Costco pulls in more revenue per employee; U.S. operating profit per hourly employee was $13,647 at Costco versus $11,039 at Sam’s Club.

The study also revealed that Costco’s labor costs are actually lower than Wal-Mart’s as a percentage of sales. Its labor and overhead costs (classed as SG&A;, or selling, general and administrative expenses) are 9.8% of revenues, compared to Wal-Mart’s 17%.

WalMart- The only difference between us and Hell itself is that we have a parking lot and a sliding door.

That article is rather misleading.  One of the biggest reasons that Costco does more sale per square foot and per employee is they have done a lot better job of marketing to small businesses.  Most financial experts say that that is the reason that they beat Sam’s club in sales increases.  Obviously if you are doing selling more to businesses you are going to be more efficient since that means fewer customers to get the sales, and it’s easier to order to fill their needs since they usually have pretty set demands.  Also in the last part they compared Costco to Walmart as a whole, which isn’t really a fair comparison since discount stores take far more work to stock and up keep than a warehouse store.  I’m sure you’ll say that that is more “Walmart drivel”, but it is the truth.  As is the fact that Costco is bringing down the whole retail sector today, because they announced that they were going to come well short of their profit projections.  Perhaps their business plan isn’t working as well as you like to think.

Perhaps their business plan isn’t working as well as you like to think. ..................or as YOU hope,Dave.

Perhaps their business plan isn’t working as well as you like to think. ..................or as YOU hope,Dave.

UMMM.  You why would I hope that Costco would be doing well?  I really could care less what happens one way or the other with Cosco.  Once again you’re posting on your own isn’t working out for you.  Maybe it is better for you to stick to copying and pasting even if the articles have nothing to do with what the discussion is about.

Perhaps YOU should start cutting and pasting ,Dave?It is self-evident that YOUR typing skills and sentence structure aren’t working out for you.Do you even proofread your OWN comments before submission?

Wrong again Dave. You have become better at revealing your planned obsolescence as a WalMart/Edelman troll/fraud/liar/fake/imp and all around bullshit artist. 

Costco is the 4th largest retailer in the United States and the 7th largest in the world. ALL significant retail measurements compare Costco and WalMart in the same retail category.

“That article is rather misleading.” Dave

No it isn’t. You just don’t like the results. Besides it was a study conducted by Businessweek that produced the facts that trouble you most on the subject of productivity.

“A 2004 Business Week study ran the numbers to test Costco’s business model against that of Wal-Mart. The study confirmed that Costco’s well-compensated employees are more productive.”

Next Dave, you will try and tell us that Sam’s Club is not part of WalMart and has no business model relationship with the Bentonville ‘love of money’ slave wages mentality.

You also wanted to pull this..."Most financial experts say that that is the reason that they beat Sam’s club in sales increases.”

Most...? You didn’t even cite one. Sources, documentation, references, citation and proof count here Dave, no matter how much you don’t like it.

WalMart/Edelman- We hire internet frauds/fakes/imps and lackeys to troll the internet and deceive Americans with propaganda. ‘Dave’ is our latest WalMart worship ass kissing toady.

Hey SanDiego View.  You didn’t disprove one thing I said. 
“Costco’s profit warning sparks more worries
Holding prices to lure shoppers hurts profit; retailer adds $1 bln to buyback
By Andria Cheng, MarketWatch
http://www.marketwatch.com/news/story/costcos-profit-warning-sparks-more/story.aspx?guid={C72D1408-BE1D-44D5-B490-19FB35BAFE19}&siteid=yhoof”

There’s your link and story on Costco not doing very well this quarter.  Their stock price dropped $8 yesterday, and at one point all the major retailers were down by at least a dollar because of that.  By the end of the day most had rebounded, showing that it was because of the Costco news.  Most my other comments were common sense.  Obviously a warehouse club is going to take less work to maintain than a store like Walmart.  You go to each and see if it takes longer do just drop a pallet out on the floor at Costco or to take every item out of the box and put in on the shelf like you have to do at Walmart. Then get back to me and tell me if that part if a lie.

Dave: Where’s the date on your Market watch story?-I don’t see it listed in your cut and paste.

Surely, my dear, someone as familiar as you are with copying and pasting the nonsense you google is capable of doing a news search for Costco.

Dave-

SDV really isn’t worth your time.

I realize neither of them are worth the time, but I was bored.  ddrb the date was right at the top of the page if you had gone to the website I provided. 

“Last update: 1:28 p.m. EDT July 23, 2008”

Dave,

“One of the biggest reasons that Costco does more sale per square foot and per employee is they have done a lot better job of marketing to small businesses”
Dave aka imbecile #9 in context evasion mode
Wednesday, July 23 at 12:57 PM

You also wanted to pull this..."Most financial experts say that that is the reason that they beat Sam’s club in sales increases.”

Most...? You didn’t even cite one. Sources, documentation, references, citation and proof count here Dave, no matter how much you don’t like it.

You still...have not cited a source for this lie you told. The MarketWatch article you allude to...states nothing whatsoever to back up this ‘small business’ farce and fabrication of yours about to shade and sleight worker productivity excellence at Costco.

A 2004 Business Week study ran the numbers to test Costco’s business model against that of Wal-Mart. The study confirmed that Costco’s well-compensated employees are more productive.

The study shows that Costco’s employees sell more: $795 of sales per square foot, versus only $516 at Sam’s Club, a division of Wal-Mart (which, like Costco, operates as a members-only warehouse club). Consequently Costco pulls in more revenue per employee; U.S. operating profit per hourly employee was $13,647 at Costco versus $11,039 at Sam’s Club.

WalMart/Edelman- We hire internet fakes/frauds/trolls and imbeciles for our public relations ‘war room’.

Again, you’re just making it up as you drivel along.

http://www.forbes.com/2004/12/07/cx_ld_1207overachiever.html

Here’s an article for you. 
“The competition for small business customers, upon which Costco is built, is getting more intense as Sam’s Club has stated a “renewed focus” on the sector. “

Generally if you have to renew your focus on an area, that means that you aren’t doing as well as your competitor in this area.  So apparently at least the experts at Walmart felt like they were getting beat in the competition for small business sales.  I think they would know too. 

“...and having very few, if any, sales people roaming its unfinished, concrete floors. “
I guess having no sales people would increase your sales per employee. 

“Further, limited inventory means fewer pallets are needed to move it and fewer hands are required to stock it. “Labor is 70% of our expenses and we can reduce the labor hours [spent] per dollar of sales,"”

Once again their approach is to make as little work for employees as possible because that means fewer employees.  So I guess Forbes agrees with me, but maybe their article about how great Costco is was somehow “Walmart lies” as well.

You found something to support your effort to possibly dissuade from-

“A 2004 Business Week study ran the numbers to test Costco’s business model against that of Wal-Mart. The study confirmed that Costco’s well-compensated employees are more productive.”

Under your false basic argument, people should not be motivated for better pay or paid better for more productivity. Unfortunately for your assertion the result at Costco produces better productivity because of their business model and social responsibility to their workforce. But then again at this point you are working hard at whistling past your own graveyard with poor assertions about labor that would no doubt prefer to work at a Costco than a WalMart any day. Except you of course. The WalMart indoctrination and propaganda you received wouldn’t work with a sense of treating labor decently and having a 90-92% health care coverage and better pay etc.

I read your post a few times, and failed to see where you addressed the facts in my article.  Since yours based productivity exclusively on sales per customer, the fact that they admit that they stock fewer types of items in order to make it easier for stockers so that they have to use less payroll is definitely applicable.  So the truth is they don’t necessarily work harder there is just a lot less work to do to maintain their sales. 

Also I NEVER said that people shouldn’t be paid more for more productivity.  That is the opposite of what I think.  That is one of my biggest problems with most union employers.  For the most part everyone gets the same raise no matter what they do, with the exception of those that have piece counts which isn’t feasible for stores.  Walmart on the other hand does have bigger raises for those that work hard, and promotes based on performance instead of on seniority.  I’m sure there are a lot of people that would rather work for Costco, but since they hire as few people as possible, by their own admission, and try to find ways to eliminate even more workers, I’m guessing it isn’t going to be all that easy for anyone to find a job there.

Dave, first it is productivity based on sales per employee and not customer and then as a comparison to Sam’s Club sales per employee. Better pay and benefits show the results of better performance and productivity against the WalMart/Sam’s club model. Even though Sam’s Club operates approx. 100 more stores than does Costco, ‘sales revenues’ are approx 20% higher at Costco. Costco also sells health insurance packages to small businesses beyond their own 90-92% employee coverage and simply has been very successful with their employee retention, pay, benefits and PRODUCTIVITY that beats the hell out of Sam’s Club for WalMart to envy and for you to make lame excuses against labor again.

Yeah I know it is sales per employee and not customer I just mistyped it because I’m used to saying sales per customer since that is a huge deal to retailers.  My argument was for sales per employee though. 
“Labor is 70% of our expenses and we can reduce the labor hours [spent] per dollar of sales”

That statement proves my point.  Their whole goal is to reduce the labor it requires to produce sales. Since that is not as much as an emphasis with Walmart or Sam’s, using the sales per employee is pointless.  Having no sales people and stockers that just have to drop a pallet to stock, you are going to have high sales per employee, but that doesn’t mean your people are working harder it just means that you are making less work for them. It seems like I have said essentially the same thing three posts in a row and you still haven’t addressed anything I say.  I know it is hard for you antiWalmart people to use reasoning, but you should try it some time.

Dave: How’s this for reasoning-If your employer pays you more,works you less and provides better benefits than WalMart,while STILL making a profit for the company’s shareholders -WHOM DO YOU THINK MOST REASONABLE EMPLOYEES WOULD PREFER WORKING FOR?

“-If your employer pays you more,works you less “

San Diego View seems to think that Costco works them harder.  My opinion is they work about the same, but it would be impossible to tell because of the difference in styles for the two companies.  Costco has less work overall for their employees but they also have less employees so it is about the same.  Also apparently you forgot the post a few back where Costco isn’t making a good profit for their shareholders.  Their stock price dropped a total of $10 from Wednesday through Friday.  Is that a good return or a bad one?

Dave: Is that an example of YOUR LOGIC, to take ONE snapshot,OF ANY COMPANY- INCLUDING WALMART- ,to provide A REALISTIC AND RATIONAL PICTURE OF THE COMPANY"S OVERALL HISTORICAL PERFORMANCE?

So you guys are allowed to use quarterly results and isolated incidents against Walmart, but Costco’s quarterly results are meaningless?  Seems fair.  You guys need to get over your hatred for Walmart.  What did they do to you?  Did you fail their Orion test so they wouldn’t hire you?

“San Diego View seems to think that Costco works them harder.”

Never said or implied that, but your evasion must reach another false conclusion. Costco workers are by far more productive and no doubt work smarter than employees over at the Sam’s Club/WalMart hellhole. Better pay, better benefits and treating your workers well is good business practice and something Dave and WalMart are not willing or capable of learning. If they have fewer workers at Costco and make 20% more then the work load per employee must be handled very very well.

“We always want a wide gap between us and the competition,” Coscto’s CFO Richard Galanti told the Seattle Post Intelligencer. “It shows in the quality of our employees…It’s what our founders want to do in paying a family wage.”

Yet, Costco’s labor costs are only about half of Wal-Mart’s. How’s that possible? One reason is that Costco workers feel valued, which adds enormously to their productivity, and they don’t leave-employee turnover is a tiny fraction of Wal-Mart’s rapidly revolving door.

While Wal-Mart makes twice as much profit as Costco, Sinegal believes its better business to make a nice profit, but not a killing, and to invest more in Costco’s 92,000 workers. “I don’t see what’s wrong with an employee earning enough to be able to buy a house or having a health plan for the family,” he says.

“We pay much better than Wal-Mart,” Sinegal says. “That’s not altruism. It’s good business.”

Vs. WalMart and Sam Walton…

Sam Walton again on exploitation of people-

Wal-Mart founder Sam Walton once said, “I pay low wages. I can take advantage of that. We’re going to be successful, but the basis is a very low-wage, low-benefit model of employment.”
http://en.wikipedia.org/wiki/Criticism_of_Wal-Mart#_note-
iswalmartgood

“Is Wal-Mart Good for America?” PBS. November 16, 2004. Retrieved on February 24, 2007.

WalMart stockholders have LOST money over the past 5 years in holding onto WalMart stock. Recent gains or loses still do not diminish Costco stock as having been the far better value long term and now a great bargain with Costco’s future growth and tremendous history. The 5 year growth line for Costco stock puts the erratic limited range WalMart stock behavior to shame again in addition to all the money investors have LOST in WalMart’s stock over the past 5 years just from inflation. 

“The propagandist’s purpose is to make one set of people forget that certain other sets of people are human.” Aldous Huxley, The Olive Tree (1937)

SDV: The term “Pattern and Practice” comes to mind.

In contradiction to the assumption that all WalMart employees are “happy as clams” with the WalMart way here is contradictory evidence:~~~~~~~~The 401(k) suit against Wal-Mart—Braden v. Wal-Mart was filed in March and is currently seeking class-action status—claims that the company breached its duties as a fiduciary by allowing its 401(k) plan participants to be charged “unreasonably expensive” fees. In its answer, Wal-Mart said disclosures about such things as “how investments options were selected” or “revenue sharing arrangements” are “demonstrably immaterial to any investment decision faced by participants.”

In addition, Wal-Mart accused the suit of disregarding the relation of the fees to the overall costs of administering the plan and ignoring “the economics of participant directed individual account plans.” The company pointed out that the Employee Retirement Income Security Act (ERISA) does not call for plan fiduciaries to consider only price when selecting investment options or select the least expensive options.

The case was filed on March 27, 2008, against Wal-Mart on behalf of the Wal-Mart Profit Sharing and 401(k) Plan under the Employee Retirement Income Security Act of 1974, or ERISA. Braden v. Wal-Mart Stores, Inc., alleges that Wal-Mart and others, as fiduciaries of Wal-Mart’s retirement plan, failed to act solely in the interests of the participants and beneficiaries of the Plan, and failed to exercise the required skill, care, prudence, and diligence in administering the Plan’s assets from January 31, 2002, through the present.

The complaint claims Wal-Mart selected and offered to Plan participants unreasonably expensive retail funds, despite the ready availability of reasonably priced high-quality investment options. As a result, the plan squandered tens of millions of dollars of participants’ retirement savings in order to pay for overpriced mutual funds, which, on top of everything, significantly underperformed their benchmarks. This resulted in larger fees being spent on inferior products.

Based on conservative estimates, the Plaintiff in Braden estimated Wal-Mart’s actions have caused the plan to waste over $60 million of participants’ retirement savings on excessive fees and unreasonable expenses alone – and will continue to do so at the rate of $20 million per year if allowed to continue. In addition, the complaint describes at length what the Plan would have been worth had it made responsible investment choices – for example, at year end of 2007, the Plan Investment Options were worth $2.861 billion, while an investment in index funds would have been worth $3.002 billion, or $140 million more.

The suit is seeking Wal-Mart and defendants to “make good to such plan any losses to the plan,” as well as any other equitable or remedial relief as the court may deem appropriate. The plaintiff is seeking the Court to adopt the measure of loss most advantageous to the Plan, putting the participants in the position they would have been had the plan been properly administered. This could be in the hundreds of millions of dollars. It is believed this class action could number over 1,000,000 participants. ~~~~~~~~~WMW~~~~~~~~~~~~Note WalMart’s position:......"In its answer, Wal-Mart said disclosures about such things as “how investments options were selected” or “revenue sharing arrangements” are “demonstrably immaterial to any investment decision faced by participants.”............... Note: What was that about arrogance again? And what about driving down costs,and driving a hard bargain?Seems like the 401k investors are the ones being squeezed instead of the vendors,in this case purveyors of high priced mutual funds, according to the legal complaint.

That is one employee, Jeremy Braden, bringing a lawsuit.  I never said every single employee was happy.  I said the majority were.  The only way they came up with the 1,000,000 participants is because that is approximately how many have contributed to the 401k plan.  So the 1,000,000 number is not an accurate number of how many are unhappy even though I’m sure the unions will use that number extensively against Walmart.

SDV you still have failed to address this, “Further, limited inventory means fewer pallets are needed to move it and fewer hands are required to stock it. “Labor is 70% of our expenses and we can reduce the labor hours [spent] per dollar of sales."” Arguing with you is like arguing with a four year old.  The workers aren’t working smarter or being more productive simply because they can drop a pallet of freight faster than a Walmart employee can stick a pallet of freight.  All it means is that Costco doesn’t merchandise because they don’t want many employees which is fine as a business plan, but that doesn’t make them a great employer.  If Walmart switched to that plan they could pay their employees more but there would be 1 million more people unemployed.  So half the workers would be better off and the other half would be unemployed, I’m not sure that that would make America a better place.

“WalMart stockholders have LOST money over the past 5 years in holding onto WalMart stock”

I missed this before, but you may want to check the 5 year history for Walmart.  The stock price has gone up and Walmart has paid about $3.50 a share in dividends in that time so I think that that means they would have made money over the past 5 years.  You may want to check your facts before you start throwing out misinformation.

Dave,

I guess, to SDV and the others, a stock price rise of over $14.00 a share in the past 9 months, is losing money!!  And, with Costco, a stock price loss of $2.89 a share in the same period, is making money!!  Also, Wal-Mart’s dividend is $.97 a share, while Costco’s is $.64 a share, So, I guess all anti-Wal-Marters should Sell any Wal-Mart stock they have and buy up Costco stock, then they too, can cash in on the Costco gains, I mean (losses), they tend to have reversed thinking, to them, losses are gains and gains are losses!!  Maybe that’s why they are always looking for raises in pay!!

Maybe that’s why they are always looking for raises in pay!! RDS~~~~~~~~~~Yes, may be looking for a raise in pay (and better benefits)- is WHY WalMart has such a high employee turnover rate,and Costco doesn’t.  I watched Steven Greenhouse on C-Span,discussing his book,The Big Squeeze,last night. According to him,Costco runs a yearly questionairre for employees asking their opinions on what they do and don’t like about the company. The overriding complaint is that they can’t wear shorts on the job,all year round .Can you imagine WalMart even DOING a questionnaire?

“WALMART STOCKHOLDERS HAVE LOST MONEY OVER THE PAST 5 YEARS IN HOLDING ONTO WALMART STOCK”

WalMart (WMT) shares bought Aug. 1st 2003 at the best low 5 year price of $55.27

Dividends paid-

.18 (2003), .52 (2004), .60 (2005), .69? (2006), .88 (2007), .48(.96 projection) (2008)

Total dividends paid per share for cited 5 year time period $3.35

Best 52 week high to date in 2008 $59.95

Total price gain per share in cited 5 year time period $4.68 + $3.35 (Div) = $8.03

no splits for the cover time period

------------------------------------------------------------------------------------------------------------------------------

Costco (COST) shares bought Aug 8th 2003 at the best low 5 year price of $29.22

Dividends paid-

.00 (2003), .30 (2004), .46 (2005), .51 (2006), .55 (2007), .30 (.62 projection) (2008)

total dividends paid per share for cited 5 year time period $2.12

Best 52 week high to date in 2008 $75.23

Total price gain per share in cited 5 year time period $66.01 + $2.12 (Div) = $68.13

no splits for the covered time period

------------------------------------------------------------------------------------------------------------------------------

Difference of 8.48 times or 848 percent benefit in owning Costco shares over WalMart shares
Aug. 2003 through best recent high of 2008

Based on the 5 year time period cited and the $7.34 gain per share in stock value for WalMart shares you would have lost money due to compounded inflation even at the official Bush government low ball inflation rate declarations for 2003 -2008 (2003 - 2.27%, 2004 - 2.68%, 2005 - 3.39%, 2006 - 3.24%, 2007 - 2.85%, 2008 - 4-5%)

55.27 inflation loss = 1.25 (2.27% full year rate)

56.52 inflation loss = 1.51

58.03 inflation loss = 1.96

59.99 inflation loss = 1.94

61.93 inflation loss = 1.76

63.69 inflation loss = 2.86 (4.5% full year rate)

By the end of 2008 your WalMart shares would need to be priced at $66.55 just to stay even with official inflation figures over the past 5 years of holding WalMart stock. So far, even with the dividend per share from WaMart stock, you have lost money ( -17.27% after inflation and at$57/share [7/28/2008] not including the 5 years of total $3.35 dividend)

------------------------------------------------------------------------------------------------------------------------------

Based on the 5 year time period cited and the $68.13 gain per share in stock value for Costco shares you would have made money even with compounded inflation even at the official Bush government low ball inflation rate declarations for 2003 -2008 (2003 - 2.27%, 2004 - 2.68%, 2005 - 3.39%, 2006 - 3.24%, 2007 - 2.85%, 2008 - 4-5%)

29.22 inflation loss = .66 (2.27% full year rate)

29.88 inflation loss = .80

30.68 inflation loss = 1.04

31.72 inflation loss = 1.02

32.74 inflation loss = .93

33.67 inflation loss = 1.52 (4.5% full year rate)

By the end of 2008 your Costco shares would need to be priced at $35.18 just to stay even with official inflation figures over the past 5 years of holding Costco stock. So far, with the dividend per share from Costco stock, you have made money (88.36% after inflation and at $61/share [7/28/2008] not including the 5 years of $2.12 total dividend)

===================================================================

SDV:  Kudos! Now,could you repeat that again,once more,in............................... Chinese,please?

It’s pretty sad when you have to bring in inflation to say that they “lost” money.  If you had meant that originally you would have made reference to that.  Also why are you posting the five year high and five year low?  That is not at all what you originally said.  You said in the last five years.  Costco is already well below their five year high, and in order to have made the amount you’re talking you would have had to bought exactly when the stock had bottomed out which is fairly unlikely.  Also the company doesn’t have all that much control over stock price since public opinion, whether accurate or not, plays in to the price so the most accurate way to measure their success would be their dividends which, according to your numbers, Walmart beat Costco by over a dollar a share.

Dave, with your attitude about investment practice and your misrepresentation of what was said, I’m surprised you’re not the one in charge of WalMart’s 401K plan for the ‘associate’ suckers.

“It’s pretty sad when you have to bring in inflation to say that they “lost” money.  If you had meant that originally you would have made reference to that.”
Dave in reading is fundamental-
Tuesday, July 29 at 12:00 AM

Originally and deliberately missing the ‘inflation’ reference Dave?

“WalMart stockholders have LOST money over the past 5 years in holding onto WalMart stock. Recent gains or loses still do not diminish Costco stock as having been the far better value long term and now a great bargain with Costco’s future growth and tremendous history. The 5 year growth line for Costco stock puts the erratic limited range WalMart stock behavior to shame again in addition to all the money investors have LOST in WalMart’s stock over the past 5 years just from inflation.”
SanDiegoView in WalMart needs propaganda to survive
Sunday, July 27 at 01:08 AM

Additional review, specific quotations of actual words stated, just for Dave…

“...over the past 5 years in holding onto WalMart stock.”
“...Costco stock as having been the far better value long term...”
“The 5 year growth line for Costco stock...”
“...again in addition to all the money investors have LOST in WalMart’s stock over the past 5 years just from inflation.”

“That is not at all what you originally said.  You said in the last five years.”
Dave the English language genie in inflated propaganda efforts on ‘WalMart’, the inflation unaffected stock.

I’m sure you could have come up with a more lame response Dave, but that would have required some productivity from you to actually do work. Your growth line sucks just like WalMart’s.

SDV:Additionally, it appears as though Dave has neglected to factor in the deflating effect of YOUR posts on HIS indreasingly inflated PR HYPE-ENOMICS.

I did miss your inflation reference in the first post, but it wasn’t intentional as you claim. It’s tough to remember all your ramblings in every topic since you seem to like to babble on and on about your hot topics.  You still didn’t explain why you used the 5 year high and lows. Nice job taking my quote out of context and trying to make it was talking about inflation when I was talking about your using the five year highs and lows instead of the actually increase for the last five years.  All that you have showed in using the highs and lows is that Costco was more volatile in the last five years which isn’t exactly a good thing.  Sears five year high was around 190 and their low was $13.20 so make sure that you buy up on SHLD since it has a huge gap between the five year high and low.
Costco’s price 5 years ago was 36.67 quite a bit over your price of $29.22, and obviously their price is not near their 5 year high either so using the high and low is misleading unless you are psychic and know exactly when the price is going to peak or bottom out so you can buy and sell accordingly.  Also it is interesting that you chose 5 years since Walmart is beating Costco for 1 and 2 years, and is about the same for 10, and is beating them fairly soundly for 20 years.  So why is 5 years the magic number?

“Sears five year high was around 190 and their low was $13.20”

Before someone jumps on that technically that was in May off 2003 so their five year low was $23.35.  Still that is a bigger difference than either Costco or Walmart so buy up on SHLD.  This information is from Yahoo Finance if you have any issues with it.