Is Wal-Mart Having Troubles? A Clue in the Dairy Section

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The headline seemed innocuous enough:  “Memo Orders Improvement at Wal-Mart.”  Written by Steven Greenhouse and Hiroko Tabuchi of The New York Times, the piece detailed the contents of an internal memo leaked by a Wal-Mart manager.  The memo, issued under the heading "urgent agenda," ordered managers in all stores to “…improve performance on "Chilled and Fresh" items in its dairy, meat and produce departments.”  

So why should this be of concern to anyone outside of the dairy, meat and produce industries?  Well, it’s because the manager who leaked the memo did so because he was understaffed and could not meet the memo’s standards.  In other words, in order to cut corners Wal-Mart has been cutting staff.   

It seems that Wal-Mart has been getting complaints about beyond date dairy products, spoiled meats and bad produce.  As the article puts it:  “…the memo tells managers to "validate that stores are fully executing on 'Would I Buy It?' – a plea to make sure that every store removes moldy or rotting fruits and vegetables.”

It’s one thing to compete with supermarkets when you have the manpower to do so; after all perishables demand a watchful eye.  It’s hard to do, however, if you don’t have someone to make sure that out of date milk is removed and bad produce is thrown in the trash.  Let’s face it, no one wants to get home and find that their milk is spoiled.  Talk about a bad shopping experience.

Wal-Mart has for years been able to move into categories like organic food and, due to its profit in non-perishables, be able to under-price the competition.  Those days may be over as reduced foot traffic lost to the Internet means that stores simply can’t justify the revenue to sustain a larger in-store workforce. 

Wal-Mart’s problems seem uncomfortably similar to those have plagued Kmart in terms of unclean stores and upsetting customer experiences.  That’s not good news for Wal-Mart and a sure sign that the world of bricks and mortar retailing is going to shrink in sometimes unexpected ways.

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