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Isaga A31

Wal-Mart's Problems Go Beyond Underpaid

Workers
Dan Mitchell Feb 20, 2015

Wal-Mart's announcement on Thursday that it would start paying its employees

more training them better, and would invest more heavily in online operations, almost
seems like it could have been a reaction to a survey released a day before, ranking the
company as "the most hated retailer in America," as several news outlets have put it.

It wasn't, of course. Wal-Mart's plans had clearly been in the works for quite a while. But
those plans, announced as the retail giant issued fairly weak quarterly results, address some
of the biggest reasons for Wal-Mart's ranking at the very bottom of the American Customer
Satisfaction Index for 2014: poor service; messy or understocked shelves; and higher prices
than many consumers expect.

The survey polled 8,700 consumers. It found overall satisfaction with retailers down by 1.4%
over last year, mainly due to higher pricesa sudden reversal after three straight years of
rising satisfaction. Wal-Mart's score of 68 (on a scale of 100) was its worst since 2007, and
continues a trend. In four of the past five years, it has scored the lowest of all department
and discount stores. This year, it scored the lowest among all retailers. Just a decade or so
ago, it regularly scored near the top.

On Thursday, Wal-Mart announced it would boost employee pay to a minimum of $9 an

hour, which will put Wal-Mart's lowest salaries 24% above than the $7.25 federal minimum
wage. Some 500,000 workers, or about a third of Wal-Mart's U.S. work force (including at the
Sam's Club warehouse-store chain) will be affected. It will, of course, eat into profits. Wal-
Mart said the short-term hit would yield longer-term benefits down the road, as happier,
better-trained, longer-tenured employees will translate into more customer traffic. The wage
hikes and improved training will cost Wal-Mart about $1 billion this year.

The action will result in average hourly full-time wages at Wal-Mart rising to $13 an hour
from below $12 an hour. That's still below the $15 per hour demanded by pressure groups,
some including Wal-Mart workers, that have been seeking pay hikes from big retailers and
fast-food chains.

Wal-Mart also pledged to invest more in its e-commerce operations. The ACSI report noted
that even as overall satisfaction with retailers fell by 1.7%, satisfaction with online retailers
rose by 5.1%, to 82 out of 100.

That was due in part to a dip in satisfaction the previous year due to a spate of delivery
problems, particularly during the holiday season. Still, it points to a big problem brick-and-
mortar retailers -- even those, like Wal-Mart, with substantial investments in e-commerce:
the convenience of online shopping is tough to beat. There's no such thing as a surly
employee or a messy shelf. And what you're looking for is generally in stock.

Hence Amazon's place at the top of the list, with a score of 86. In the discount and
department store category that Wal-Mart belongs to, Nordstrom was tops, also with an 86.
Target tied with Kohl's at No. 3, each scoring an 80.
Reve Joy E. Isaga A31
Reve Joy E. Isaga A31

Green Supply Chain News: Walmart CEO Announces Still More

Aggressive Sustainability Goals for 2025
By The Green Supply Chain Editorial Staff Nov. 9, 2016

Pledges to be Powered by 50% Renewable Sources, Help Workers to Build Careers Even Outside of Walmart
Former Walmart CEO Lee Scott really got the retail giant''s Sustainability engine moving in the mid-2000s. The
program was certainly supported under Scott''s successor Michael Duke, and arguably taken in even more aggressive
directions by current CEO Doug McMillon.
The Green Supply Chain Says:
Some of all this may be coming from Walmart''s own view of how it needs to proceed. But increasingly, Walmart
consumers want to buy Sustainable products, McMillon said.
McMillon, for example, wrote in Walmart''s Global Responsibility Report for 2016 that "When we get it right,
customers are able to shop at ease, knowing we did the work for them. They know that the products on our shelves
and website were produced at a low "true cost" for all - not just in terms of being the best value, but in terms of
whether they enhance the environment and the lives of all the people who helped produce them."
McMillon poured it on some more last week at the Net Impact conference in Philadelphia, laying out a number of
new Sustainability goals for 2025. They include:
Achieve zero waste to landfill in Canada, Japan, UK and the US
Be powered by 50% renewable energy sources (versus about 25% currently) under a plan designed to achieve
"science-based" CO2 emissions targets
Double sales of locally grown produce
Expand sustainable sourcing to cover 20 key commodities, including bananas, grapes, coffee and tea
Use 100% recyclable packaging for all private-label brands
Eliminate certified synthetic colors and artificial flavors and get rid of other food additives "where possible"
Now, for some of the detail.
McMillon said Walmart will be the first retailer with an emissions-reduction plan approved by the Science Based
Targets Initiative, an organization formed by the CDP (Carbon Disclosure Project), the UN Global Compact, WRI
(World Resources Institute) and WWF (World Wildlife Fund). It says its mission is to help companies determine
how much they must cut emissions to prevent the worst impacts of climate change. It does that by somehow
working with companies to align their CO2 emission reductions goals with UN calculations about how much CO2
emissions must fall to meet the levels some believe will keep temperatures from rising above the 2 degrees C level
many see as the key to minimizing the environmental impact.
Walmart says that will use a combination of energy-efficiency measures, along with a commitment to source half of
the company's energy needs from renewable sources, to achieve an 18% emissions reduction in its own operations
by 2025. It says it will also work with suppliers to reduce their emissions by one gigaton by 2030.
Another new 2025 commitments is to source "more commodities produced with zero net deforestation, including
Brazilian soy and private label pulp, paper and palm oil." However, specific goals if any in this area were not
detailed.
The new goals go beyond environmental issues. When it comes to its workers, Walmart says it will put "millions of
people" through training to equip them with portable skills to get ahead, whether they stay with the company or
move on to another. That echoes thinking McMillon first articulated in Walmart''s 2015 Sustainability report, when
he wrote that one of the company''s missions is to create "economic opportunity for our associates, suppliers and
people who work in retail and retail supply chains beyond Walmart."
Walmart also says that it will "foster predictability and stability through paid time-off and predictable schedules" for
its workers, and ensure men and women are paid equally for the same work across the globe.
Walmart recently signed on to the White House First Jobs Compact, a nationwide effort to help out-of-school, out-
of-work youth ages 16 to 24 find their first jobs.
Some of all this may be coming from Walmart's own view of how it needs to proceed. But increasingly, Walmart
consumers want to buy Sustainable products, McMillon said.

"In our experience, there are a lot of customers" who care about Sustainability, McMillon said, adding that "Over ti
me, they''re becoming more sensitive and aware of what they''re buying and their impact on the world."