WAL-MART PINNED DOWN ON THE BEACHHEAD…
General Dwight Eisenhower’s worst fear on 6 June 1944 was that the allied troops landing at Normandy would get pinned down on the beaches and pushed back into the English channel. This is a fear that Wal-Mart is growing to appreciate.
This morning from the Chicago Tribune.
[Wal-Mart] was planning to open a handful of stores in the city in one swoop, a blitzkrieg that would have established Chicago as its urban beachhead after failed attempts to blanket major cities as Wal-Mart has done in rural and suburban areas.
A year later, the world’s largest company is still stuck on the shore.
Its single store on Chicago’s West Side is doing “good but not great,” a Wal-Mart official concedes. Local business owners say they are disappointed with a program Wal-Mart launched aimed at helping them survive in the shadows of its new store. And the retailer’s efforts to open a second Chicago store are bogged down.
And, of course, the gnomes are not pleased.
If Wal-Mart can’t succeed in Chicago, the retailer’s urban strategy will have suffered a critical blow at a time when investors have grown increasingly frustrated with Wal-Mart’s lack of growth. Its stock now trades around $45, down 25 percent from March 2004 compared with a 35 percent gain in the Standard & Poor’s 500 index in the same time period.
“At this point, the areas they haven’t cracked have been the urban areas,” said Patricia Edwards, managing director at Wentworth Hauser & Violich, a Seattle-based investment firm that has dramatically cut its Wal-Mart holdings to 38,000 shares from more than 1 million shares three years ago. “That has been their weak spot. They have to be successful in going into urban markets or they’re not going to be able to continue to grow at the rate they have in the U.S.”
Street fighting is hell.
[...] Jeff found this extraordinary follow up on Wal-Mart’s much-ballyhooed Chicago store before I did this morning, but I want to spend a little time dissecting a different paragraph than he did: Wal-Mart also is adjusting to an inner-city workforce that in many cases lacks fundamental job skills. Wal-Mart is giving many workers their first jobs, [Chicago Alderman Emma] Mitts said. Roughly 80 percent of the workforce was hired from the neighborhood, where unemployment is high and the median household income is $38,386. More than 15,000 people applied for the store’s 400 jobs. [...]
[...] WAL-MART PINNED DOWN ON THE BEACHHEAD… General Dwight Eisenhower’s worst fear on 6 June 1944 was that the allied troops landing at Normandy would get pinned down on the beaches and pushed back into the English channel. This is a fear that Wal-Mart is growing to appreciate. Keep reading… [...]