Merchants get advice for taking on Wal-Mart

June 24, 1992|By Kerry O'Rourke | Kerry O'Rourke,Staff Writer

WESTMINSTER -- Merchants forced to compete with Wal-Mart Stores Inc. should be ready to switch, not fight.

To stay in business, they will have to sell merchandise Wal-Mart doesn't, extend their hours, improve return policies and smile more often, said an Iowa professor who speaks across the country on how to compete with the retail giant.

"A smile in every aisle sounds trite," but a surly cashier can chase customers away, said Kenneth E. Stone, an economist from Iowa State University.

"It is possible to coexist," he said.

Mr. Stone spoke yesterday to about 100 store owners, bankers, real estate brokers and other business people curious about how Wal-Mart will affect them when it opens a store at the Englar Business Park at Route 140 and Englar Road in the fall. The

event at Martin's Westminster was sponsored by the Carroll County Chamber of Commerce.

Mr. Stone also spoke in Laurel yesterday. Wal-Mart is negotiating for a site at Russett Center at Route 198 and the Baltimore-Washington Parkway. A company spokeswoman said plans for the site are not final.

Wal-Mart, the discount chain based in Bentonville, Ark., has four stores in Maryland and is building several others.

Mr. Stone said stores that sell building materials, clothing, groceries and specialty items are hurt most by the arrival of a Wal-Mart, while restaurants, gas stations and home furnishings and general merchandise stores generally fare well.

"If you're selling the exact thing they're selling, then you're in jeopardy," he said.

He encouraged merchants to visit a Wal-Mart to compare prices but warned that Wal-Mart employees are instructed to ask anyone who's making a list of prices to leave.

Wal-Mart employees will be shopping in competitors' stores, though, and will lower prices if they find Wal-Mart's are higher, he said.

Such aggressive moves have allowed Wal-Mart to double sales about every three years, he said. Net sales in the last fiscal year were $43.9 billion.

Smaller merchants should offer services Wal-Mart can't -- on-site repairs, deliveries, technical advice, and special orders, he said.

Roberta Kasik, manager of Bobby's Hobby Lobby, said the store will offer more craft demonstrations and classes. Wal-Mart's arrival is "like a wake-up call," she said.

R. Steven Stewart III, manager at the Leggett department store in Cranberry Mall, said he expects to do well against Wal-Mart because he sells more upscale brands.

But Wal-Mart is a fierce competitor, he said, and its entry into the market "tends to make you get up a little earlier and work a little harder."

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