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2000-12-29
Chicago, IL. First Bradlees, Now Montgomery Ward

The old year 2000 went out with a retail groan, as thousands of workers were thrown out of work, victims of the "one country, one store" mentality that drives retailing in the U.S. today. Just a matter of days after Massachusetts-based Bradlees announced that it was shutting 105 stores and laying off 10,000 people (see newsflash below) the venerable Montgomery Ward cashed in its chips, after 128 years at the table. Wards will button up 250 stores, and leave 37,000 people without work. Between Bradlees and Wards, 47,000 Americans have lost their paycheck, and a staggering 355 stores will be gone. The Associated press placed the blame on "competition from other big retailers", and Bloomberg News said Ward "struggled to match the low prices at Wal-Mart stores and Kohl's Corp." The CEO of Ward blamed "the very difficult retail environment" for his company's death. One could say that Ward's death took place over 38 years, as stores like Wal-Mart, K-mart and Target all were born in the early 1960s, and slowly ate away at Ward's market share. Ward was founded 12 years before Sears, Roebuck, but by 1997 had filed for Chapter 11 protection. It's a similar story for Bradlees, Caldors and other regional chains, like Home Base. 47,000 workers represent a lot of struggling families, but it amounts to only 5% of Wal-Mart's U.S. workforce. If you assume roughly 300 workers at every new Wal-Mart Supercenter, then the next 156 Wal-Mart supercenters to open will only compensate for the jobs killed this week by the closure of Bradlees and Ward. Since Wal-Mart plans to open roughly 167 supercenters this year, the closure of these two companies wipes out any employment gains Wal-Mart will "create" this year.

What you can do: Wal-Mart likes to say that it is a "retail magnet" and that it creates jobs and helps other businesses. The demise of Caldors, Bradlees, Montgomery Ward, Home Base and others only illustrates that much of what Wal-Mart passes off as job growth is in fact offset by equal or greater job losses. Wal-Mart is not a retail magnet, its a black hole, and 47,000 American workers just fell into that hole. We are rapidly moving to the "one country, one store" marketplace, where competition is defined as the clash between two or three huge global chains. It is ironic that Montgomery Ward, the store that purportedly came up with the slogan "satisfaction guaranteed" was killed in part by a store that now writes those stolen words on its featurelessless walls. Ward is just more proof of the reality that Wal-Mart is not creating much employment-wise, and this week's news gives us 47,000 examples of economic destruction. As Wal-Mart has said: "At Wal-Mart we make dust. Our competitors eat dust."










 
 
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