Saturday, March 23, 2013

How Did the NY Times Miss Walmart?

Walmart has had an amazing story for a company younger than the Boomers. Check out this cool flowchart for the growth of Walmarts across America since the company's inception. I checked Google's ngram service, and Walmart really only jumped in mentions in the late '80s, despite being a publicly traded firm for years and close to the number one retailer in America by that point. The times had reported on Walmart solely from a stock perspective from the mid '70s to the late '80s until the famous "When Walmart Comes to Town" hit piece. By then, it was already too late, and Walmart would rule the Brazilification of the US mid to lower end consumer. Only when their media properties were affected did the NY Times pay attention. The NY Times missed this growth story that would change all of America due to its New York centric worldview and Walmart's growth in the southern Midwest.

The growth was staggering, including year over year revenue growth for 12 straight years right in the teeth of two recessions in the early '80s. The NY Times didn't notice anything weird about them. From the '87 stock earnings report blurb,

It is, in fact, difficult to find an analyst who is not bullish on Wal-Mart Stores Inc. of Bentonville, Ark., which has taken the discount-store route to become the nation's third-largest general merchandiser, after Sears, Roebuck and K Mart. ''Management,'' enthuses one analyst, ''is fantastic.'' ... Wal-Mart operates its discount department stores in 23 states, mainly in smaller communities across the Sun Belt. Now observing its 25th anniversary, the cost-conscious company has fostered what one analyst calls ''an unusual culture with a concern and commitment for its employees.''

This should have sparked something in the NY Times' heads; maybe even inspire a profile. That profile did not come until 1989. In the '89 article, they use an Iowa store's saga to explain how Walmart destroyed downtown retailers and preyed upon small communities. The analysts words were lies if the NY Times had only researched it a bit since the very claims made about management or care for employees could have been refuted by the people interviewed in the '89 profile since Walmart had screwed them over by '87. The NY Times missed this though because of that mention that Walmart was in rural areas of the Sun Belt. Unless a black kid is getting killed by white supremacists in the Sun Belt in the '70s and '80s, the Times wouldn't notice, the NY Times isn't reporting on the southern midwest, so Walmart might have as well been on Mars.

Check out the flowchart again for store openings. Not a single northeast store until the '90s. Check out the Times' media properties again. They purchased a bunch of southeastern papers in '85. In the '89 article, the economists and small town people say it takes eight to nine years for a town to turn into a ghost town when a Walmart moves in. Walmart started cracking into Alabama and the Carolinas in the early '80s. The NY Times bought those newspapers in '85 and would have seen ad revenue drop immediately and throughout the '80s because of mom and pop store closings. This ad revenue drop would have raised a red flag and caused analysis internally. The local paper would have said, "We're not selling more ads because the Walmart destroyed local businesses". With no chance to boost ad revenue, the Times would have seen a lower return on investment. Someone at the Times would have been clued into why the newspapers' owner sold for such a 'deal'.

That is what got the Times interested in the underbelly of Walmart. Walmart's unique way of destroying competition across different retail sectors would have affected the bottom line of the Times. That 1989 profile in the NY Times Magazine was the first hit piece. In defense of the Times, it is a bit more fair than I expected. Even in the '89 Times profile, they mention Walmart blackmailing towns, accepting their money to build their stores, and screwing over American manufacturers. From the profile, "In 1987, 100,000 independent manufacturers representatives initiated a public information campaign to fight Wal-Mart's effort to remove them from the selling process, claiming that their elimination jeopardized a manufacturer's right to choose how it sells its products." You know who is a great megaphone for any piss ant liberal cause but missed out on 100,000 manufacturing employees fighting a big bully? The NY Fucking Times! Imagine what the Times could have done for US manufacturing, but they had to tell us to be nice tot he Commies. Walmart's true stab in the back to America was squeezing American manufacturers for years, delaying their accounts payable as long as they could, and forcing suppliers to go out of business... and then Walmart just shifted purchasing to China. As South Park put it, we shop there, we give them our cash, we love the bargains. The Walmart leviathan is of our making, but a little sunshine on that disgusting beast in its infancy may have stopped or at least slowed the monster down.

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