The Walmart Lesson

The editor of the Ozaukee Press certainly nailed it with this editorial.

If you like a particular business, you need to support it whole-heartedly.

Wouldn’t you rather have your money support the people you know, rather than add to a millionaire’s portfolio?

Connie Roller, Manager The Feed Bag Pet Supply.

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The Walmart Lesson

Written by Ozaukee Press

Wednesday, 10 February 2016

The mega-retailer’s decision to close outlets teaches consumers   a painful lesson about what can happen if they fail to support the local businesses that enhance their communities.

Walmart’s announcement last month that it will close 154 stores in the United States shocked and angered residents of communities affected by the closings.

These Walmart shoppers, many of whom live in small, rural communities, said the company betrayed them by opening stores in their towns that lured them away from independently owned shops with product selection and discount pricing only to announce now those stores will close. In the process, long-established mom-and-pop operations unable to compete with the retail monolith went out of business, leaving soon-to-be former Walmart shoppers faced with having to drive 20, 30, even 40 miles to buy a gallon of milk or a carton of eggs.

Shocking? Hardly. Community loyalty has never been a factor in the giant corporation’s business plan, so when it became clear its smaller Express store concept was a failure and on-line retailers like Amazon were cutting into its profits, Walmart did what you’d expect by shedding underperforming stores and changing directions.

Doug McMillon, Walmart’s president and chief executive, said the decision was not easy. It probably wasn’t that difficult either. The 154 stores in the United States, plus another 115 outside the country that are slated to be closed, account for less than 1% of Walmart’s global square footage and revenue, which was $485 billion last year.

Walmart detractors, however, are on the right track when they talk about betrayal, although they have it backward. It was consumers who betrayed local merchants by choosing to spend their money at Walmart instead of at their corner grocery stores.

Along with the stories of irate Walmart shoppers who now will have to drive miles for their groceries are those of shop owners who watched in disbelief as customers loyal to them for decades gave their business instead to the mega-retailer.

Therein lies the cautionary tale to emerge from the Walmart closings. Consumers who fail to support their local businesses do so at their own risk — the risk of losing merchants who, while not always able to match the quantity-driven discounts offered by big box retailers, typically provide quality goods and services at fair prices and contribute in no small way to the quality of life of the communities they do business in.

The Walmart closings won’t affect Ozaukee County, but residents of small communities here know what it’s like to lose stores that offered necessities like groceries and were just a pleasant stroll or short drive away.

In 2007, Belgium Village Market opened in a new building that was to be the anchor of a retail and business development. A year later, it closed for lack of business.

More than six years later, the village is still without a grocery store.

In December, Village Market, Fredonia’s only grocery store, closed. Its former owner, David Roggenbuck, who sold the business months earlier because he could no longer make a go of it, told Ozaukee Press, “It is a tough business, especially when people only stop in for one or two items before heading to places like Walmart or Target for their major grocery shopping.”

Village Trustee Lisa Dohrwart described it as a “don’t know what you got ’til it’s gone” moment for Fredonia, and astutely described the trickle-down affect of business closings on a community. Aside from the economic impact, the blight of empty buildings and a dearth of local shopping options, fewer local businesses mean fewer members for organizations like the Chamber of Commerce, fewer sponsors for community functions and causes and less self-sufficiency for villages and cities that teeter on the line that separates thriving municipalities from bedroom communities.

Port Washington is an example of the former for several reasons — a healthy downtown, a strong tourism economy, residential development and yes, a grocery store. It’s unthinkable that a city of nearly 12,000 people would not have a full-service food market, yet that was the case in Port for a short period of time until Sanfilippo’s Sentry Foods opened. It remains the only grocery in the city and needs the support of local customers if it’s going to continue providing an essential service in Port.

The lesson in the Walmart closings isn’t that a global corporation with annual profits in the hundreds of billions of dollars isn’t loyal to the communities it does business in, but that consumers who don’t support local businesses risk losing stores that provide needed services and goods and make their villages and cities better places to live.

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