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Ummm ...is this really called for?

Anyway - I can't stand Wal-Mart (I'm from the US). It's one of the most ethically questionable companies out there (Although I guess many large chains do the kinds of things they are known for). I wouldn't be surprised if the reason they cut was that they didn't like paying employees a living wage, giving them vacation, and god forbid health care, and staying to regulated hours. I wish Americans would figure out a way to make Wal-Marts go away (the only plus really is that the more money they make, the more taxes go to the government for what one would hope are useful causes).

Wal mart made a wise business decision.

As to some of the comments by Jesse.... if those people who work at Wal mart are unhappy I am sure they can find better paying jobs, don't you?

"I can't stand Wal-Mart (I'm from the US). It's one of the most ethically questionable companies out there"

Does Walmart pay their employees on time? Yes.
Does Walmart pay their employees what they agreed upon? Yes.
Does Walmart provide safe working conditions? Yes.
Does Walmart force employees to be there? No.

Well I made quite the opposite experience at the Walmart in Karlsruhe, Germany: I found the personnel there rather unfriendly and not very responsive to customer's demands, which I didn't like at all. It was simply the closest and cheapest grocery store available.

Philipp,

I might suggest you go back and reveiw some of the court and labor rulings which have gone against Walmart in Germany. That this should happen to you in light of these ruling I would not consider at all surprising.

The bottomline the courts stated Walmart was violating worker rights. It would appear customers in a contest of rights have few rights when compared to labor.

But as Jesse pointed out, Walmart is going to close over 80 stores in Germany. I have no idea how many people it employed but I am equally sure these people will have no problems finding jobs now that according to the popular press Germany is back, the Germany economy is booming.

In fact, I would not be surprised that Germany will not have to import more workers to meet the current labor shortage.

As most regular DMK readers know, I am an enthusiastic supporter of the USA. I am also very happy and proud to live in the USA.

There is one thing I don't understand though in the US. I know everyone can get free health care at emergency rooms. What are people in low paying jobs supposed to do though when they need regular doctor check-ups, or regular medication? It is one thing to get a broken leg fixed up, it is another thing when dealing with a sudden and long lasting chronic disease.

I am lucky - I am healty and my health insurance would anyway cover pretty much everything, but what about people without or with little coverage. Do they get medical attention only when they are ill enough for the emergency room?

I know this is a very complex issue.

P.S. I guess German Walmarts gave up on the smile policy; I haven't seen any sign of it in Düsseldorf.

The good news is they are go to be bought by Metro AG. Time will tell how this is going to play out.

There are both state and federal health insurance programs to meet the needs of those who otherwise would not have insurance.

As an example in GA there is a program called Peach Care. For a family of 3 with an annual household income of less than $40,000 healthcare for children under the age of 5 is free. From ages 6 – 19 there is a small monthly preimun ranging from $10-35 per month but no family will pay more than $70.00 per month. Under this plan there are no co-payment are deductibles.

For adults there is Medicaid, which eligibility is based on income levels. In GA there is a program called Healthy Families, which is like any other insurance plan. Under this plan dental and vision care are included.

I have no idea how similar programs operate in other states. Each state has its own plans established to meet the needs of its citizens.

WalMart hasn't learned the old Teutonic lesson: Arbeit macht Frei.

Nobody will say it but I am pretty confident that it is a casualty of anti-americanism. Not that I have much sympathy for Wal-Mart but I certainly would have driven into Germany just to buy ANYTHING not produced by the local cartels.

Ah, the good old PacRimJim Nazi non-sequitor.

joe, the court ruling against WalMart concerned their effort to prohibit love affairs between employees. Not only love affairs, if I remember correctly, but also dinner dates and "lusty looks" at the workplace. In order to enforce those policies, they established an anonymous snitching hotline where employees could turn in their co-workers.

Bottom line is, WalMart didn't do their homework (same happened to them in South Korea, by the way), and thought that by simply buying 80 crappy, poorly located supermarkets they could somehow push their way into the highly competitive German discounter business. Maybe they should have taken a lesson or two from Aldi's expansion strategies (Trader Joe's, for example).

As you may know, I m usually reluctant to recognize anti-americanism as a reason for certain developments. But here I have to agree FranceSucks:

At least partly this company is a victim of it. Whenever there are two mega-stores at a similar distance and Wal-Mart would be one of it, there would have to be a very good particular reason (special offer) to go to Wal-Mart for most people I know. Otherwise, they would just go to the other shop.

PacRimJim always reminds me of a class mate at my former school. He made the same jokes, and so I have to smile whenever he posts :)

Flux, I agree wholeheartedly. I'm not sure what Wal Mart was doing in Germany, but it certainly wasn't right. They completely misread the business environment. BTW, just as a point of clarification for those who haven't seen both, a Wal Mart in Germany is NOTHING like the normal supercenter in the States. What makes Wal Mart "what it is" in the States is completely lacking in Germany. A Wal Mart in Germany is just another of an abundant number of small, dark, unattractive, discounters with no greater selection, no lower prices, no better parking, and no friendlier service (already discussed) than any of the others. In other words, no compelling reason to shop there.
My family loves WM in Florida; here I think we've only been in one once.

The Wall Street Journal has a front page piece on this today. Interesting. Apparently German shopping habits are quite different from those in the U.S. The article noted that Germans will buy coffee in one store and then travel to another store for a better price on paper towels. Here in the US, we like one-stop shopping. (I wonder if just the relative size of our respective spaces has anything to do with that?) Because WM couldn't achieve the economies of scale needed, they couldn't get those prices down.

Another point I found amusing - Germans like to bag their own purchases. I HATE that! Some grocery stores here have installed self-checkouts. I won't use them. That method just about doubles the time I need to get thru checkout.

flux.

Of course you failed to address the business model used by Walmart such as deep discounting due to their world wide buying power or their hours of operations, etc.

These would voliate workers' rights.

Or am I once again wrong on this.

As I stated this was a wise decision by Wal mart. I have to agree with Scout why did Wal mart ever go to Germany in the first place. If you are third or fourth into a hostile enviroment your odds of being sucessful combined with not being allowed to use your business model almost insures failure.

Thanks, joe, for the info on Peach Care; very interesting.

Just for the file:

http://en.wikipedia.org/wiki/Walmart


http://en.wikipedia.org/wiki/Criticism_of_Wal-Mart


@whatdoiknow

Like Peach care every state has a program. It is State run, however federally funded. The biggest problems seem to be that while States have certain Budgets, they have to advertise every year heavily in order to entice people to join.
Like my own Daughter with four children finds it too bothersome to go to that office, stand in line and fill out the application.
What a shame.

I see that "Jesse" is one of many many Wal-Mart bashers who come from a long line of leftists who hate to see companies become successful.

And I just haven't figured out a person's "right" to health care or the definition of a "living wage". And what the hell are "regulated hours"?

As far as I know, every time a Wal-Mart (in the States) is slated to open a new store, Wal-Mart is deluged with thousands of job applications. It sure sounds like a place that thousands of people want to work. Things must not be too bad there then, eh?

I'm surprised that "Jesse" forgot to mention that Wal-Mart recently announced its support for increasing the minimum wage. But alas! Not only does a minimum wage increase unemployment (another topic alltogether), but ask yourself why would Wal-Mart be so supportive of a higher minimum wage? Well, it would be to drive other stores out of business which cannot afford to pay the higher minimum wage/higher labor costs (a "bad" side of Wal-Mart).

But lefties such as "Jesse" will complain about that, too.

P.S. The part about German customers "hating" smiling Wal-Mart employees or getting free bags is utterly hiliarious. We like to be miserable! We are happy when we are unhappy! Or so it seems. And see, Jesse, they have "regulated hours" and vacation time, too.

Love 'em or hate 'em will always be open for discussion. For me it was a small piece of home that I will miss.

WalMart hasn't learned the old Teutonic lesson: Arbeit macht Frei.

Posted by: PacRimJim | July 29, 2006 at 08:19 AM

What a bozo comment from someone mentally-challenged. Wal-Mart is a disaster at retailing in Europe, it is shoddy and has made a disaster of Asda in Britain. Trying to take on Aldi and Realkauf and Plus in Germany was truly bizarre. Germany has loads of discount retailers and Britain has highly concentrated retailing groups. Wal-Mart just didn't research its markets.

But if the level of things descends to PacRimJim associating Wal-Mart with Auschwitz we might as well pack in. Not only is it tasteless but it reflects that glib superficial understanding that says if it isn't done the American way - ie the Wal-Mart Way - it must be evil.

With people like PacRimJim spouting slogans you can see why he is copied by Aby Hamza or Nasrullah or Zawahiri. It is the triumph of sloganising over thinking.

Having lived in Germany for so long, I am more familiar with the German Wal-Marts than I'll ever be with ones in the States (I think I've been in one in Arizona, and that's been it).

I highly doubt that anti-Americanism had anything to do with this decision. Running a business would be very easy if one wanted to open stores in every market throughout the world. Obviously (and for a myriad of reasons), not every market can support such a venture.

But I sure did like the one-stop shopping. I'm the last person on the planet who is going to drive all over town to buy different things to save 10 cents.

Now we shall see if Metro (the company that bought out the Wal-Mart stores) retains all of the workers they will inherit from the Wal-Marts. Somehow, I doubt it. Perhaps "Jesse" will hire them at a "living wage" and provide them with health care out of his own pocket.

In any case, I'll be sad to see Wal-Mart go.

Let me just note that a lot of the Wal-Mart bashing in the US is funded and driven by the United Foond and Commercial Workers Union. My wife's a member (to be employed at a unionized store, one must join the union), I see their magazine.

The potential and current workers at Wal-Mart seem to be about as satisfied as any other retail workers.

The union's interest, of course, is to maximize its income. It badly wants Wal-Mart unionized. My wife's store competes with a number of privately owned grocery chains. It seems the union has given up on trying to unionize them, and changed it's attention to Wal-Mart.

Let me not come across as a union basher, especially not the UFCW. We have gotten considerable scholarship assistance from them, and it's nice having a second insurance for the family. The only real drawback to the union that I see is the rigid seniority system. And the fact that the enforced dues are used in large part to fund the Democrats.

"Bottom line is, WalMart didn't do their homework...., and thought that by simply buying 80 crappy, poorly located supermarkets they could somehow push their way into the highly competitive German discounter business."

Flux,

I never thought I would ever agree with one of your comments, but you are totally on point.

Wal Mart distinguished itself in the U.S. by moving into small, rural, middle-sized cities.....cites that the big retailers traditionally ingnore. Eventually, they started moving into the outer sub-urbs of big cities. You would never see a Wal Mart in Manhattan or down town Chicago.

Wal Mart is able to destroy its competition by investing in a state of the art information technology system. At the end of a business day, Wal Mart executives can find out not only what total sales were for the day, but can also determine what is presently selling. For an example, both sides of the Atlantic are experiencing heat waves. I'll bet air conditioners and sprudel are big sellers right now. Once Wal Mart knows what is selling in their stores, they will then go to the supplier, (China, Inc), and negotiate the must advantageous wholesale price from the seller.

I am sure this business model was lacking in Germany. It is a shame that they did not move into the smaller Kreis cities, where many people have to travel 50 kilometers to the larger retail outlets.

"Another point I found amusing - Germans like to bag their own purchases. I HATE that!"

Pamela,

Welcome back! When my sister-in-law saw the baggers at our local supermarket, she remarked "so that is how the Americans create 'make-work jobs.'"

We had to explain to her that a majority of the baggers and cashiers were high school kids, working part-time on their first-ever jobs.

I am sure that the 'make-work job' comment is something that she picked up in the German media. I think the whole bagging concept is way-over their heads....sort of like eating pizza with your hands.

When i go to Munich, there's a Wal-Mart right in front of the place i work at. I've gone there several times and i have to say tht the cashiers r truly a bit non-friendly. I'm not saying they're rude, they r just not friendly...

I wish Americans would figure out a way to make Wal-Marts go away (the only plus really is that the more money they make, the more taxes go to the government for what one would hope are useful causes).

Posted by: Jesse | July 29, 2006 at 02:12 AM
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I suppose we could give up Capitalism? In any event since the data is that 80% of Americans shop at Wal-Mart SOME time during the year, you should rephrase your statement to reflect that the rest of America should do what YOU want them to.

What are people in low paying jobs supposed to do though when they need regular doctor check-ups, or regular medication?

Posted by: WhatDoIKnow | July 29, 2006 at 06:40 AM
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County Health clinics.

Let me just note that a lot of the Wal-Mart bashing in the US is funded and driven by the United Foond and Commercial Workers Union. My wife's a member (to be employed at a unionized store, one must join the union), I see their magazine.

The potential and current workers at Wal-Mart seem to be about as satisfied as any other retail workers.

Posted by: MarkD | July 30, 2006 at 05:27 PM
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Correct and their record while picketing is shameful.
I did an post on my blog on that for an instance where the Union was hiring TEMP workers to picket and leaving them out on the side of the road in conditions that any Union would be SCREAMING about if a business had similiar working conditions.

What's Wrong With This Picture

The strange business of protesting jobs that may be better than yours

By Stacy J. Willis

Wal-Mart picketers
Photo by Iris Dumuk

The shade from the Wal-Mart Neighborhood Market sign is minimal around noon; still, six picketers squeeze their thermoses and Dasani bottles onto the dirt below, trying to keep their water cool. They're walking five-hour shifts on this corner at Stephanie Street and American Pacific Drive in Henderson—anti-Wal-Mart signs propped lazily on their shoulders, deep suntans on their faces and arms—with two 15-minute breaks to run across the street and use the washroom at a gas station.


They're not union members; they're temp workers employed through Allied Forces/Labor Express by the union—United Food and Commercial Workers (UFCW). They're making $6 an hour, with no benefits; it's 104 F, and they're protesting the working conditions inside the new Wal-Mart grocery store

Oh and some information on the positive aspects of WalMart is in

Let Them Eat Cake

County Health clinics

Thanks, Dan. I didn't know about them.

This is a little OT, but I am reading about people who use emergency room care without ever paying for it. I know a guy who had to go to the emergency room (I guess they did some x-rays on him), they billed him and his insurance covered everything. So, if someone in his situation didn't have insurance, the hospital would bill him and then... they would never see the money? If they have his name and address, is there no way for the hospital to recover their costs ? Can't they sue him ?

I remember reading (somewhere) that many peopole who declare bankruptcy are doing it because of medical bills. Also, many of those people had insurance when their troubles first started. Can this be true?

So, if someone in his situation didn't have insurance, the hospital would bill him and then... they would never see the money? If they have his name and address, is there no way for the hospital to recover their costs ? Can't they sue him ?
****************************************************
Originally hospitals which were in part or all constructed with Federal funds were under a mandate to provide probono medical care and then as I recall a Law was passed stating that NO hospital could turn away a medical emergency case.

If they can't pay, yes the hospital bites the bullet unless there is some kind of Federal reimbursement I am not aware of.
****************************************************

I remember reading (somewhere) that many peopole who declare bankruptcy are doing it because of medical bills. Also, many of those people had insurance when their troubles first started. Can this be true?
****************************************************
It could be but I would like to see the figures.
We can do many things now that were impossible medicaly in the past but it does cost.

Looks like close to what you are talking about here is a good article.

http://www.commondreams.org/headlines05/0202-08.htm

Half of Bankruptcy Due to Medical Bills -- U.S. Study

The next highest cause is divorce.

So don't get sick and don't get married and you should have no problems ;-)

Now keep in mind that most States have Homestead Laws, so if the debt is not tied to the mortgage they can keep their homes, they can keep quite a bit of their property and their slate is wiped clean, can't refile again for 7 years though.

Ruins long term credit, but not always short term because they can't get out of short term for the 7 year period.

If I am mistaken about the above, someone is more than welcome to correct me.

Oh as for the County Health Clinics I recall we used to go there when I was a boy for shot etc.

They also do diet training and other services for the community.

Thoughts about Wal-Mart – A few reasons for failure in Germany

Land and construction cost are very high, which forced Wal-Mart to use pre-existing buildings that often did not fit in to the Wal-Mart formula. i.e. – easy parking, wide aisles, several checkouts etc…

The purchase of supermarket chains that were struggling themselves started Wal-Mart off to a weaker start than a fresh start could have been. The inclusion of the old inventory initially did not help with customer’s first impressions.

Wal-Mart should have avoided food. Aldi and the others have that covered with good results and high customer satisfaction. Non-food was, and still is an open market with huge potential. Wal-Mart should have tapped in more to the need and desire for one stop hard goods shopping.

Stay away form cities. Just as in America, people living in large cities tend to be more liberal socialist with anti-American tendencies. They WANT to believe anything negative they hear about America and that translates in to lower sales. Smaller stores in smaller towns would have provided more growth and sales. The same formula Sam Walton built his empire on starting in Bentonville, Arkansas. It would have worked in Germany.

Friendly service really only works with friendly customers. No matter what country you are in.

Wal-Mart will always have trouble with unions as long as unions believe that every job, even entry level jobs should be “fully benefited” jobs for life. Until realistic understandings of an open market exist in Germany, the tendencies to base everything upon the “Soziale Marktwirtschaft” will cloud all decisions. American companies that do business in Germany must realize that by law you are dealing with a “Soziale Marktwirtschaft”, the Ami’s will be doomed to failure if they try common American practices in Germany without considering the economic laws and realities.

A code of conduct will not be accepted by a workforce or society that does not understand the concept. They tend to think everything they don't understand is a cult. Motivation is best left at home you know.

Wal-Mart had trouble with the using the “concept” of the “loss leader”. More accurately, the German courts have trouble understanding the concept. (Not to mention that the courts dabble too much in to free enterprise restrictions), the court does not see a “loss leader” for what it really it. "Just another form of advertising!" If a retailer losses x amount in a given period to bring in customers through a loss leader, that is their decision. Just as if they spend x amount in sales flyers to bring in customers. There is no difference. The German courts still don’t get it.

Last thought -

From “Financial Express” of 20. June 2006 -
Wal-Mart is examining "all the shops which are not profitable" among its German outlets, said David Wild, director of the United States company's German operations, in an interview with the Sunday newspaper Welt am Sonntag.
It has had a presence in Germany for eight years.
"As a world business, we cannot ignore this market," Wild said.

Mr. Wild, you are dead wrong,
I would say, yes, you can ignore this market, and you should. Sorry to see you go.

flux, Scott, wc and others: Thanks for the perspective. You are right; it sounds like Wal-Mart got away from their formula in Germany, and that contributes to the problems they are having now. Let me ask you a couple of questions, though:

1. As wc mentioned, if the cost of land and building is high, then that works against a business like Wal-Mart. Does the permit process enter into this at all? For example, we've seen some places in America where local officials have used the permit process to hold up the building of Wal-Mart buildings while allowing competitors to breeze through.

2. How have labor flexibility restrictions entered into it? As you probably know, Wal-Mart relies heavily on a just-in-time inventory system that requires workers to be able to assume a number of different responsibilities from one day to the next. Have work rules or restrictions in Germany forced them to hire more employees than they need at a given site?

3. Related to that: How many of these store closings are staff reductions by other means? In the U.S., individual Wal-Mart stores are constantly adjusting their staffing based on market conditions at the moment (for example, the Christmas rush where they hire a bunch of temporary employees who are then laid off in January). Do German restrictions prevent them from laying off employees that they don't need, forcing the chain to close the whole store to get rid of the labor overhead?

NYTimes:

In Germany, analysts say, Wal-Mart never got traction in a market that is characterized by unrelenting price competition, well-established discounters, and the cultural resistance of German shoppers to hypermarkets, which sell fresh vegetables a few aisles away from lawn mowers.

Scheisse! I read it a day or two ago and can't find it...but anyway.

If what I read is true, then "unrelenting price competition" was not the fault of WalMart. Supposedly, a couple of years ago, the German government forced WalMart to raise it's prices because small mom and pop stores would be driven out of business. (Where have I heard that before?)

I remember when WalMart first opened in Hanau. There were signs throughout the store that guaranteed the lowest prices within a 50 km radius. Funny, I haven't seen those signs for 3-4 years.

Here are some thoughts for the questions from cousin dave;

To #1
The building process in Germany is regulated and controlled by various planning councils and committees just as anywhere. Regularly in the media there are reports of various projects being contested, delayed and cancelled for various reasons. It seems to me that the Germans are very active in voicing their opinions and thoughts throughout this process. This of course is commendable. Unfortunately, often projects are challenged for questionable reasons. I do not know if Wal-mart built any new stores, (I suspect they did not), but based on my experiences while living in Germany, I am sure any Wal-mart request for a building permit would be heavily contested. Possibly in a smaller community where increased tax revenues are more important than the name of the person that makes the Nikes that are sold in Wal-mart a permit would be issued.

To #2
I am not sure about Wal-mart specifically, but in general every formal working relationship is regulated with a work contract between the company and the employee. Job descriptions are sometime very detailed and sometimes somewhat left option. Often there is a clause that say that if the company wants to use you in a different capacity they may do that. Conversely, there is a clause that if they do that you may give notice and resign, with cause. This puts the worker in a different situation in regards to unemployment benefits compared to just quiting because the worker is not satisfied with his work assignments.

To #3
I do not think that happens to much here unless the decision making process is really messed up. The concept of limited work contracts is used very often here in Germany. Also, temporary worker companies (zeitarbeit) are becoming very popular.

Wal-marts biggest problems with the system are not unique to Wal-mart. It is often reported that a company cannot do something that is standard practice in a capitalist system because the courts see it as wrong for some reason. The economy is often hampened by the court system. Of course the courts are just making their rulings based on the economic reforms of 1967 that cemented the socialist/market economy in to German life. No company has been immune to some of these anti-capitalist decisions.
Wal-mart does suffer from MSM bias. Any news that the consumer gets about Wal-mart contains an element of bias originating in the USA. We all know that story though. This does hit the bottom line very hard.

Walmartophobia is not just for Germans:

http://travismonitor.blogspot.com/2007/01/walmartophobia.html

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