Top Retail Analyst Shatters Conventional Wisdom, Urges Wal-Mart To Increase Wages And Benefits
For Immediate Release
Tuesday, January 09, 2007
Washington, D.C. – The current issue of Fortune magazine (“The Unending Woes of Lee Scott,” 1/22/07) examines the problems plaguing the company and polls analysts, investors and retail experts about how Wal-Mart can “get its mojo back” in 2007. Among the suggestions: Wal-Mart could improve its image, decrease employee turnover and lower expansion resistance by focusing on wages and benefits. Excerpts from the story are below.
How can Wal-Mart get its mojo back? Here are four ideas from Fortune interviews with analysts, investors and retail experts:
“…Extend an olive branch to the haters. HSBC retail analyst Mark Husson’s suggestion was the boldest we heard: Take a one-year ‘holiday’ from earnings growth to increase pay and particularly benefits for employees. ‘I could write the press release now,’ says Husson, whose stock-picking prowess ranked among the top 5 percent of all analysts last year, according to StarMine. ‘Having done the right thing by consumers for so many years, it’s now time to do right by our employees. It will be good for America and good for our employee turnover as well.’ Husson says high turnover is hurting sales, especially of upscale items.
“A splashy act of goodwill, says Husson, should also make it easier for Wal-Mart to expand in blue states, where efforts to open new stores have met the most resistance. Kentucky has three times as many Wal-Mart supercenters (61) as California (21). On a per capita basis, Wal-Mart is four times more concentrated in red states than in blue, whereas Target’s stores are evenly divided.”
- Click here to read the Fortune story.
- Click here read the health care proposals outlined by Wal-Mart Watch in “A Handshake With Sam”
