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Sam Walton

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Sam Walton
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  • Born: 29 March 1918
  • Birthplace: Kingfisher, Oklahoma
  • Died: 6 April 1992 (multiple myeloma)
  • Best Known As: Founder of discount retailer Wal-Mart

Sam Walton, with his brother Bud Walton, founded Wal-Mart, the chain of discount variety stores that in the 1990s became the world's largest retailer. Sam Walton went into the retail business in 1945, and by the time Wal-Mart first opened in 1962 he owned a chain of 15 variety stores in Arkansas, Missouri and Oklahoma. Walton's savvy marketing skills and attention to detail led to Wal-Mart's expansion throughout the United States. By 1990 Wal-Mart was the nation's top retailer in terms of sales, and Walton was one of the richest men in the world. After his death in 1992 the company continued to expand, including online commerce and stores around the world. By 2001 there were more than 4,500 Wal-Mart stores worldwide.

Since Walton's death the chain has come under fire for its labor practices and aggressive marketing tactics. Arguing that Wal-Marts drove out other merchants, many local communities fought to keep new stores from opening, and in June of 2004 a lawsuit was filed on behalf of 1.6 million women, charging that Wal-Mart discriminated against female employees.

 
 
Biography: Sam Moore Walton

Businessman Sam Moore Walton (born 1918) built Wal-Mart into one of the nation's largest retailers and became one of the richest Americans.

Sam Moore Walton was born in Kingfisher, Oklahoma, March 29, 1918. The older of two boys, his father was a banker. A product of the Great Depression of the 1930s, he graduated from the University of Missouri in 1940. He married Helen Robson after graduation and eventually had four children. He served three years as an Army intelligence officer during World War II.

Walton had started in retailing with the J. C. Penney Company in Des Moines, Iowa, as an $85-a-month trainee. He spent the period 1938-1942 with them. After his army service, in 1945 Walton used his savings plus a $25,000 loan to buy a Ben Franklin store in Newport, Arkansas, where his brother joined him. In 1950, when his landlord failed to renew his lease, Walton moved to Bentonville, Arkansas, now a town of about 10,000 and headquarters to the Wal-Mart empire.

From 1945 through 1962 he operated Ben Franklin stores; by 1962 he had nine stores - Walton's 5 & 10 - operated under a franchising agreement with the Chicago-based Ben Franklin. Then began what became one of America's most successful retail operations - Wal-Mart, which he co-founded in 1962.

At that time Walton decided that the future of retailing was in discount stores, not dime stores. He studied chains such as K Mart and Zayre and then proposed to the Ben Franklin management the starting of a discount store. When they showed no interest, he, along with his younger brother James, opened his first Wal-Mart outlet in Rogers, Arkansas, five miles from Bentonville.

Walton avoided publicity about himself, preferring that his stores occupy the spotlight, and he took a direct role in the administration of those stores at all levels. He was, indeed, perhaps a corporate evangelist, and in his articulation of a vision for his firm is a good example of the conscious creation of a corporate culture - a set of shared values which define a business and those who work in it. Preferring to be called "Sam," or "Mr. Sam" at most, he might appear at a Wal-Mart checkout, or loading dock, or at a rally at a new store opening.

His business has been described as an extremely well managed one. Although the stores tended to operate as relatively inexpensive, no-frills units and appeal to a lower-middle-class market, the company was quite willing to invest at the cutting edge of technology. The stores were clustered around warehouses in order to permit one-day delivery of goods, and advertising costs were minimized. An early innovation was the decision to buy directly from manufacturers rather than through wholesalers. In addition, the company was firmly committed to a "Buy American" program. Walton built his firm into the fastest growing and most influential force in the retail industry, with stores averaging an annual growth rate of more than 35 percent for more than a decade - a rate more than three times that of the retail industry in general. An investor who spent $1,650 for 100 shares of stock in 1970, when the firm went public, would have had $700,000 worth of stock at 1987 prices. In the process, Walton became one of the richest men in the world, with estimates of his worth varying widely and growing constantly.

This early and phenomenal growth - Wal-Mart stood behind only Sears and K Mart in the retail field and was challenging them - was achieved as essentially a regional chain, operating in the Sunbelt. In later years it created a chain of warehouse stores - Sam's Wholesale Club - and was moving into the hypermarket area, Wal-Mart Supercenters. In 1990 there were more than 1,000 stores and more than 150,000 employees.

Walton was the epitome of modern retailing, adapting to contemporary demographic trends. He built his empire not in the large urban areas of the North, East, and West - the politically and economically dominant regions of the first two-thirds of the 20th century - but in the South and Midwest (the former once depressed and neglected, the latter the "heartland" of the nation). His strategy was not to take on the large chains and department stores of the urban centers, but rather to compete with the local chains and individual merchants of smaller urban areas and their rural surroundings. When his stores did approach larger population centers, they went first to the periphery of the urban area. That strategy changed in the 1980s with the extension of stores to the other geographic areas of the nation - in order to build a truly national chain - and the movement in toward the center of the urban areas.

Sam Walton died on April 5, 1992 at 74 years of age. He left behind a fortune that amounted to over $23 billion in Wal-Mart stock alone. Before his death, Walton penned a book in 1992 entitled Sam Walton, Made in America. By 1997, five years after Walton's death, Wal-Mart had grown to over 2,300 stores with annual revenues of $104.8 billion per year.

Further Reading

The major biography of Sam Walton is Vance H. Trimble, Sam Walton: The Inside Story of America's Richest Man (1990), which discusses his rise and wealth and also describes the common man who continued to live in a small Arkansas town and drives an inexpensive car. Other sources are Art Harris, "The Richest Man in America" in Reader's Digest (May 1986); Howard Rudnitsky, "Play It Again, Sam" in Forbes (August 10, 1987); and Michael Barrier, "Walton's Mountain" in Nation's Business (April 1988). Information on both Sam Walton and Wal-Mart can be found on the World Wide Web at http://www.wal-mart.com.

 
Britannica Concise Encyclopedia: Samuel Moore Walton

(born March 29, 1918, Kingfisher, Okla., U.S. — died April 5, 1992, Little Rock, Ark.) U.S. retail magnate, founder of Wal-Mart Stores, Inc. He attended the University of Missouri and then trained with the J.C. Penney Co. In 1945 he started a chain of variety stores in Arkansas, and in 1962 he opened his first Wal-Mart store in Rogers, Ark., offering a wide selection of discount merchandise. Whereas other discount-store chains were usually situated in or near large cities, Walton based his stores in small towns where there was little competition from established chains. Using this strategy his company expanded to 800 stores by 1985. In 1983 he opened the first Sam's Wholesale Club. Walton stepped down as chief executive officer of Wal-Mart Stores in 1988 but remained chairman until his death, by which time there were over 1,700 stores and Walton's family was the wealthiest in the U.S. In the 1990s Wal-Mart became controversial for depleting downtown districts of their commercial life by siting stores nearby. By the end of the 20th century it had become the world's largest retailer.

For more information on Samuel Moore Walton, visit Britannica.com.

 
Spotlight: Sam Walton

From our Archives: Today's Highlights, March 29, 2006

Samuel Moore Walton, founder of the Wal-Mart discount store chain, was born on this date in 1918. When the first Wal-Mart opened in Fayetteville, Arkansas, in 1962, Sam Walton and his brother, Bud, already owned 16 variety stores in Arkansas, Kansas and Missouri. Now Wal-Mart employs well over 1.5 million people and is the world's largest chain of stores. Walton was listed as the richest man in America by Forbes magazine from 1985-1988. He split up his holdings to include his wife and children and this year five Waltons rank #17-21 on Forbes' list of the world's wealthiest people.
 
Columbia Encyclopedia: Walton, Sam
(Samuel Moore Walton), 1918–92, American retailing executive, b. Kingfisher, Okla. After 17 years of operating franchise retail stores, he opened the first Wal-Mart Discount City in Rogers, Ark., in 1962. Walton developed Wal-Mart into a chain of massive, centrally controlled stores that were typically sited in small towns and rural areas. The stores featured heavy discounting, smaller profit margins than usual coupled with higher-volume sales, and a customer-oriented staff. Wal-Mart flourished, went public in 1970, and by 1991 had become a multibillion-dollar business and America's largest retailer. Walton, who stepped aside as chief executive of the company in 1988 but remained active in its management, was by 1985 the wealthiest person in the United States.

Bibliography

See his autobiography (1992); biography by B. Ortega (1998).

 
Quotes By: Sam Walton

Quotes:

"I had to pick myself up and get on with it, do it all over again, only even better this time."

"High expectations are the key to everything."

"Outstanding leaders go out of the way to boost the self-esteem of their personnel. If people believe in themselves, it's amazing what they can accomplish."

"I have always been driven to buck the system, to innovate, to take things beyond where they've been."

"We let folks know we're interested in them and that they're vital to us. cause they are."

"There's a lot more business out there in small town America than I ever dreamed of."

See more famous quotes by Sam Walton

 
Wikipedia: Sam Walton
Samuel Moore Walton
Samwalton.jpg
Born March 29 1918(1918--)
Flag of the United States Kingfisher, Oklahoma
Died April 6 1992 (aged 74)
Occupation Former Chairman, Wal-Mart

Samuel Moore Walton (March 29 1918 – April 6 1992), born in Kingfisher, Oklahoma was the founder of two American retailers Wal-Mart and Sam's Club. He was the patriarch of the Walton family, one of the richest families in the world.

Early life

He was born to Thomas Gibson Walton and Nancy Lee Walton near Kingfisher, Oklahoma on March 29, 1918. There, he lived with his parents on their farm until 1923. Sam's father decided farming did not generate enough income on which to raise a family, so he decided to go back to a previous profession of a mortgage man. So he and his family (now with another son, James born in 1921) moved from Oklahoma to Missouri. There they moved from one small town to another for several years. While attending 8th grade in Shelbina, Sam became the youngest Eagle Scout in the state's history.[1] In adult life, Walton became a recipient of the Distinguished Eagle Scout Award from the Boy Scouts of America.[2]

Walton excelled physically in high school, playing basketball and football as starting quarterback for Columbia's David H. Hickman High School in 1935, when they won the state title. While at Hickman, he also served as vice president of the student body in his junior year and as president in his senior year. He performed well enough academically to become an honors student.

Sam, as he appears in David H. Hickman High School's yearbook
Enlarge
Sam, as he appears in David H. Hickman High School's yearbook

Growing up during the Great Depression, Walton had numerous chores to help make financial ends meet for his family. He milked the family cow, bottled the surplus and drove it to customers. Afterwards, he would deliver newspapers on a paper route. Upon graduating, he was voted "Most Versatile Boy."

After High School, Walton decided to attend college, hoping to find a better way to help support his family. He attended the University of Missouri–Columbia and majored in economics and was an ROTC officer. During this time, he worked various odd jobs, including waiting tables in exchange for meals. Also during his time in college, Walton joined the estimable Zeta Phi chapter of Beta Theta Pi fraternity. He was also tapped by QEBH, the well-known secret society on campus honoring the top senior men. Upon graduating, he was voted "permanent president" of the class. He was also a member of the professional business fraternity Alpha Kappa Psi.

Walton joined JCPenney as a management trainee in Des Moines, Iowa three days after graduating from college. This position earned him $75 a month. He resigned in 1942 in anticipation of being inducted into the military for service in World War II. In the meantime, he worked at a DuPont munitions plant near Tulsa, Oklahoma. There he met his future wife, Helen Robson, in April 1942.

Robson was the valedictorian of her high school class and a graduate of the University of Oklahoma at Norman with a degree in business. She was the daughter of L.S. Robson, a prosperous banker and rancher. She and Sam were married February 14, 1943.

Soon afterwards, Walton joined the military in the US Army Intelligence Corps, supervising security at aircraft plants and prisoner of war camps. In this position he served in the continental United States. He eventually reached the rank of captain.

The first stores

In 1945, after leaving the military, Walton decided he wanted to own a department store but would settle for a variety store. With some help from his father-in-law with a loan of $20,000, plus $5000 he had saved from his time in the Army, Walton purchased a Ben Franklin variety store in Newport, Arkansas. The store was a franchise of the Butler Brothers chain.

It was here that Walton pioneered many concepts that would prove to be crucial to his success. Walton made sure the shelves were consistently stocked with a wide range of goods at low prices. His store also stayed open later than most other stores, especially during the Christmas season. He also pioneered the practice of discount merchandising by buying wholesale goods from the lowest priced supplier. This allowed him to pass on savings to his customers, which drove up his sales volume. Higher volumes allowed him to negotiate even lower purchase prices with the wholesaler on subsequent purchases. Walton's store led in sales and profits in the Butler Brothers' six-state region. One factor that made this store successful was its central location, making it accessible to a wide range of customers. In an attempt to limit the expansion of his main competitor, the Sterling Store, Walton leased a nearby Kroger store and opened it in 1950 as the "Eagle" department store, but it didn't fare as well.

Due to the variety store's enormous success, the landlord, P. K. Holmes, refused to renew the lease when it expired, desiring to pass the store onto his son. The lack of a renewal option, together with the outrageous rent of 5% of sales, were early business lessons to Walton. Despite the inherent unfairness of forcing Walton out, Holmes bought the store's inventory and fixtures for $50,000, which Walton called "a fair price."

Walton's Five and Dime (a.k.a Walton's 5 & 10)

Sam Walton's original Walton's Five and Dime, now the Wal-Mart Visitor's Center, Bentonville, Arkansas.
Enlarge
Sam Walton's original Walton's Five and Dime, now the Wal-Mart Visitor's Center, Bentonville, Arkansas.

Before long, Walton arranged for another location for a new store. Unable to find a new location in Newport, Walton located a variety store in Bentonville, Arkansas which he would open as another called "Walton's Five and Dime." In Bentonville, the Waltons became involved in numerous civic activities. Walton served as president of the Rotary Club and the Chamber of Commerce.

A chain of Ben Franklin stores

Over time, Walton went on to open more Ben Franklin stores with the help of his brother, father-in-law, and brother-in-law. In 1954, he opened a store with his brother in a shopping center in Ruskin Heights, a suburb of Kansas City. He opened another in Arkansas, but it failed to be as successful as his other stores. Walton decided to concentrate on retail business instead of the shopping centers and opened larger stores which were called "Walton's Family Center."

Walton offered managers the opportunity to become limited partners if they would invest in the store they oversaw and then invest a maximum of $1,000 in new outlets as they opened. This motivated the managers to always try to maximize profits and improve their managerial skills. By 1962, Walton and his brother Bud owned sixteen variety stores in Arkansas, Missouri, and Kansas (fifteen Ben Franklin and the one independent Fayetteville store).

The first Wal-Mart

The first true Wal-Mart opened in 1962 in Bentonville, Arkansas. Wal-Mart eventually became the world's largest retailer.

Walton stated, "Each Wal-Mart store should reflect the values of its customers and support the vision they hold for their community." Wal-Mart has outreach programs led by local associates who grew up in the area and understand its needs. Wal-Mart becomes involved in local communities by allowing local charities to hold bake sales on store property, and by offering scholarships to graduating seniors from local high schools.

Legacy and death

In 1985, Sam Walton began a program designed to stem the 'tide of communism' in Central America by promoting capitalism and privatization.

In 1998, Walton was included in Time Magazine's list of 100 most influential people of the 20th Century. Walton was honored for all his pioneering efforts in retail in March 1992, when he received the Presidential Medal of Freedom from President George H. W. Bush.

Forbes ranked Sam Walton as the richest man in the United States from 1985 to 1988, ceding the top spot to John Kluge in 1989 when the editors began to credit Walton's fortune jointly to him and his four children. (Bill Gates first headed the list in 1992, the year Walton died). Wal-Mart Stores Incorporated also runs Sam's Club warehouse stores. Wal-Mart stores operate in Mexico, Canada, Argentina, Brazil, China, Puerto Rico, and in the United Kingdom (having taken over Asia).

He left his ownership in Wal-Mart to his wife and their children: S. Robson "Rob" Walton, John T. Walton, Jim Walton, and Alice Walton. Rob Walton succeeded his father as the Chairman of the Board of Wal-Mart, and John was a director until his death in a 2005 plane crash. The others are not directly involved in the company (except through their voting power as shareholders). The Walton family held 5 spots in the top 10 richest people in the United States until 2005. Two daughters of Sam's brother Bud Walton, Ann Kroenke and Nancy Laurie, hold smaller shares in the company and are also billionaires in their own right.

Walton supported various charitable causes, including those of his church, the Presbyterian Church (USA). The Sam and Helen R. Walton Award was created in 1991 when the Waltons made a gift of six million dollars which included an endowment in the amount of three million dollars to provide annual awards to new church developments that are working in creative ways to share the Christian faith in local communities.

Walton was not very interested in politics, but he was a republican.

Walton died April 6, 1992 of a type of cancer called multiple myeloma.[3]

(Sources: "Made in America", by Sam Walton. *page 329, and #334)

See also

Further reading

  • Vance H. Trimble, Sam Walton: The Inside Story of America's Richest Man, 1990.
  • Sam Walton and John Huey, Sam Walton: Made in America : My Story, 1996. ISBN 0553562835.

References

  1. ^ Townley, Alvin [2006-12-26]. Legacy of Honor: The Values and Influence of America's Eagle Scouts. New York: St. Martin's Press, pp. 88-89. ISBN 0-312-36653-1. Retrieved on 2006-12-29. 
  2. ^ Distinguished Eagle Scouts. Troop & Pack 179. Retrieved on 2006-03-02.
  3. ^ Ortega, Bob. "In Sam We Trust: The Untold Story of Sam Walton and How Wal-Mart Is Devouring America", The New York Times. Retrieved on 2007-02-07. 

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From Today's Highlights
March 29, 2006

There is only one boss. The customer. And he can fire everybody in the company from the chairman on down, simply by spending his money somewhere else.
- Sam Walton

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