It looks like an April Fool's headline, but mega-retailer Wal-Mart has announced a program to help small retailers succeed when a giant Wal-Mart store lands in the neighborhood. Wal-Mart, which has laid waste to many a downtown business district by opening up all-in-one retail centers on the outskirts of towns and cities across country, appears to be taking a different tack with its new push into the neighborhoods of urban America. Under the program announced Tuesday in Chicago the giant retailer will offer small businesses near its urban stores, even hardware stores, dress shops and bakeries with which it directly competes, financial grants, training, and even free advertising. Wal-Mart envisions setting up 'Opportunity Zones' in up to 50 metropolitan areas with the first being the West Side of Chicago.
Wal-Mart's 'Opportunity Zones' involve establishing a Wal-Mart Business Development Team to hold seminars for small businesses and produce a an annual market research report that will be shared with the surrounding small business community, plus designating up to five small businesses per quarter in a 'Small Business Spotlight,' which confers benefits such as free inclusion in local newspaper ads and free radio ads broadcast in Wal-Mart stores. Wal-Mart plans to put special emphasis on helping minority and female-owned businesses with training and with special 'Working With Wal-Mart' sessions tailored to aid local minority and female-owned businesses use Wal-Mart's proximity to their advantage. Wal-Mart will also donate up to $500,000 to local chambers of commerce for the creation of small business Websites and business improvement seminars.
Wal-Mart's new program is an attempt to polish its image as it plans a major move into America's urban environments. Criticism of Wal-Mart's predatory pricing policies (see 'Wal-Mart Applying Toy Category Kill Shot'), low wages, and worker's health insurance policies have gained traction over the past year -- the New York Times quotes a internal Wal-Mart report that found that from 2 to 8% of Wal-Mart consumers have stopped shopping at the mega-chain because of a relentless drumbeat of criticism from unions, documentary film-makers and community groups. One recent study on the impact of the arrival of Wal-Mart on a community's wage structure found that both retail and non-retail wages dropped between 2.5% and 4.8 % in the wake of the mega-chain's appearance.
Whether stores selling books, DVDs, toys, and other pop culture products will come in for any of the Wal-Mart bennies is unclear, and the number of stores involved will be small in any case, but it's a major change for Wal-Mart to even acknowledge that its presence can cause pain to other retailers, much less try to counteract it.
