Friday headline roundup

How Wal-Mart disappoints both investors and customers (CBS News, 2/20/14)

“Price is important to a first purchase, to get the customer in the door, but typically it’s high quality that keeps the customer coming back,” said ASCI Managing Director David VanAmburg, in an email. “In the case of Wal-Mart, the chain has been able to offer the lowest prices for such a long time that there has been for some shoppers an almost irresistible appeal despite the many problems with quality, such as unkempt shelves, lack of inventory and lack of customer service, all of which can be related to a paucity of staffing relative to other retailers that, of course, helps Wal-Mart keep its prices down in the first place.”


Which is all the more reason why a minimum wage hike would be good for Walmart. Sure, they’d have to pay their workers more, but so would everyone else. And the benefits of a minimum wage boost would go largely to the types of Americans that shop at Walmart. A report released Tuesday by the Congressional Budget Office found that raising the minimum wage to $10.10 an hour would lift 900,000 Americans out of poverty and give 16.5 million low-income Americans a raise.


Why Is Walmart Paying Chris Christie’s Pals? (The Daily Beast, 2/18/14)

Environmentalists counter that the story of the super store, is emblematic of how business gets done in Chris Christie’s New Jersey, a place where environmental rules get gutted if need to appease the right political powerbrokers and if you hire the right law firm—in this case, Wolff & Samson, a firm that has been the go-to law firm for the Christie administration and that now finds itself in buffeted by its involvement in a series of scandal swirling around the governor.


Wal-Mart Stores: Five ugly facts revealed in today’s earnings announcement (Business Insider, 2/20/14)

Brian Sozzi, chief equities strategist at Belus Capital Advisors, points to “five shocking aspects” of the report. From his note to clients: “Wal-Mart is accelerating new store openings in the U.S. while failing to address (and communicate to the Street) the operating issues in its supercenters, such as unproductive space and out of stocks in fast-turning products (fresh food, consumables).  That turning a blind eye is a recipe for long-term margin and returns pressure.”

What do you think?