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2007-11-20
Atlanta, GA. African Foods Supplier Says Wal-Mart Sabotaged Her Product

You can understand big corporations by how they treat little people. Another book slamming Wal-Mart's corporate practices has been written -- this one by a former Wal-Mart supplier. Kunmi Oluleye, who lives today in Georgia, came to the United States from her native Nigeria when she was 14 years old. She says she learned to cook by default, because she was the oldest of 4 children, whose parents were both working full-time outside the home. Her father and grandfather were bakers. Oluleye has a graduate degree from Simmons College in Boston, and is the founder of a small business called Sheba Foods. She also became one of thousands of vendors who tried to break into the retailing big league at Wal-Mart. Her new book, Life With Wal-Mart: A Vendor's Story, narrates "all the hell that broke loose with Wal-Mart" during her two and a half years interacting with the retail giant. "I can't remember sleeping well in the two and a half years of the Wal-Mart relationship," Oluleye writes. "Depression was a constant demon to deal with... Will they pull the product off the shelf tomorrow?" Oluleye told Wal-Mart that she had a dream "of seeing African products have the same presence as Spanish foods in Wal-Mart and other stores." But on the way to the dream, Oluleye passed through the Arkansas version of Hell. "A small company doing business with Wal-Mart can attain million dollar status overnight, " Oluleye writes. "It is also true that the same company doing business with Wal-Mart can become bankrupt overnight in less time than it took to attain the million-dollar status." Oluleye says people offered her condolences instead of congratulations when she told them her products were in Wal-Mart. Oluleye admits that she "was definitely one of those seduced by almost 7,000 Wal-Mart stores." She knowingly signed a contract with Wal-Mart that allowed them to pull her product off the shelf without notice, and for no reason. Because her African food products were unique at the time, she had no price pressures from Wal-Mart. "They accepted the price I gave them," she recalls. But she had growing doubts about the Wal-Mart business model. "How can the quality be there given suppliers have to make and sell their products cheaper each year? You get what you pay for." Oluleye navigated her food company through the Wal-Mart supplier's maze of the Local Supplier Questionnaire, the Women's Business Enterprise certificate, the Dun and Bradstreet rating, the Universal Code Council number, the insurance coverages, the demo expenses, etc. In December of 2003, she completed all the paperwork for 4 products: Jollof Rice, Sheba Stew, Melon Gourmet, and Jute Soup. In less than 3 months, she got a letter from Wal-Mart saying a buyer had approved all her products. But she learned this letter offered no guarantee that any Wal-Mart orders would be made. The local managers had to decide if they wanted the product on their shelves. She was approved as a minority supplier -- which made Wal-Mart look good -- but her letter did "not mean they'll do one cent of business with me." She had to go back to the managers to get shelf space. It took her
six weeks to meet with 29 frozen food managers within a 150 mile radius of her base in Georgia. Accepted in 24 stores, Oluleye delivered all the first orders herself, driving 11 hours in one case to Warner Robbins, Georgia. With Wal-Mart's Retaillink system, she was able to monitor the hourly selling of her products by store. Oluleye began getting memos from Wal-Mart that some of her products were damaged -- but she was not allowed to see the "damaged" merchandise. "I had to pay the large amount Wal-Mart dictated to me. This was harassment. They tried to frustrate my freezer efforts, hoping I'll get upset and quit." At one point, when Sheba Foods tried to move from freezer to deli products, Wal-Mart required Oluleye to go back to Dun & Bradstreet for a new Supplier Evaluation Report. D&B gave
her a bad credit report, which meant her relationship with Wal-Mart would be terminated. "I felt raped by Wal-Mart through D&B. The tears just kept rolling," Oluleye writes. D&B later corrected the credit report, making it acceptable to Wal-Mart. But her relationship with Wal-Mart was never smooth, and by March of 2006, Oluleye had written to the retailer to vent
her anger at the lack of progress she was making. "It would seem that Wal-Mart actively works to eliminate small business from its vendor list, while presenting a good front on doing business with minority suppliers." Her Jollof Rice product was apparently not being put out on the shelf. "Most of the time when I visited the stores, the rice was nowhere in sight... The sales associates told me they were instructed to make the rice available for sale only when I did demos. I would have to do demos everyday, all day in all five stores. That was absurd! No one from
Bentonville communicated that to me." The stores began reporting high wastage. Wal-Mart employees in the store told Oluleye that "managers had been instructed by Bentonville to do all they could to show poor sales." Oluleye ended up sending letters to Ambassador Andrew Young (who worked briefly for Wal-Mart) and Jesse Jackson, desperately seeking help to deal with the sabotage of her food products by Wal-Mart. No one came to her
aid. A Wal-Mart Vice President finally called Oluleye and said, "We won't be continuing with the trial. We gave it a good try. Your product got more attention than most." To which Oluleye replied, "I feel the product was sabotaged, and will fight you and Wal-Mart hard."

What you can do: Oluleye is still in the food business, but her encounters with Wal-Mart were clearly devastating. " "After the Wal-Mart experience," she writes, "I was worn out! Sheba Goods is taking a break for 2007 from supermarket deliveries. She says that Wal-Mart could be treating the people it does business with a lot better. "It can treat its suppliers as well as its competition, it choose not to." Oluleye admits that before she began trying to do business with Wal-Mart, she did not think about much besides the everyday low price. Her book has this confession: "As a shopper, I didn't care how the products got there. It was a good price and I bought it. My supplier experience broadened my knowledge. I still shopped at Wal-Mart after they kicked my product out." There are no doubt thousands of vendor stories about Life With Wal-Mart. Most of them will never be told. Kunmi Oluleye felt that Wal-Mart deliberately ruined her chance to reach "million dollar status." It is not clear what Wal-Mart's motivations were, but neither Oluleye nor Sheba Foods had any leverage over this huge corporation. In
the end, Oluleye's friends who sent her condolences for being in bed with Wal-Mart turned out to be right. For more background, or to order Oluleye's book, go to www.lifewithwalmart.com










 
 
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