Now here's where it gets interesting. Walmart, long the veritable symbol of corporatization, of homogenization, of erasing whole towns by swallowing every mom-and-pop down Main Street; Walmart, who keeps prices down while driving profits up through über-efficient centralization and superior logistics and operations capabilities – that Walmart – is talking about ‘going local.’
What does it even mean? How will they do it profitably? How will they do it credibly? How will it impact the local farmers, craftsmen, etc from whom they will be sourcing? What will it mean for the few remaining independent retailers? Will it really be local or somehow second-class local, the way there is organic and then there is made-in-China organic. How will they harness all of this in the Walmart brand story? How will they even pull it off? And, surely, where Walmart goes, other big box retailers are not far behind.
For Walmart, the idea of ‘thinking local’ began in 2006, in response to criticism over its treatment of local communities. There were efforts of goodwill in the local community – offers of financial and marketing assistance to the small businesses Walmart was putting in jeopardy. And there were efforts to customize operations to local consumer needs – including a Walmart in Ohio outfitted with hitching posts for horses.
The latest in Walmart’s expanding definition of going local is a planned rollout of smaller format stores. They are said to be pursuing 200 to 300 locations as small as 20,000 square feet, versus a typical footprint of 195,000 square feet. According to a spokesman, the strategy is intended to “put us closer to our customers… so they can experience a Walmart when, where and how they want.” Another interesting spin on catering to local needs.
Target, by the way, recently announced plans for a Seattle location that's a much smaller version of its usual store format. Scheduled to open in 2012, the new Target concept may expand in several years to other cities such as Baltimore and San Francisco. Where Walmart leads, others will follow.
But mostly what people mean these days when they refer to the local movement is local-and-sustainable sourcing. A few months ago, Walmart announced a program intended to put more locally grown food in Walmart stores, encouraging sustainable agrigulture among its suppliers, and reduce its overall environmental impact. In an undertaking it calls Heritage Agriculture, farmers within a day’s drive of a Walmart warehouse are encouraged to grow crops that now take days to arrive in trucks from states like Florida and California. Over the past two years, partnerships with local farmers have grown by 50%. And they say they plan to double the percentage of locally grown produce sold in the US to 9%. In other countries, that percentage goal is much higher.
Because of Walmart’s size — it’s a $405 billion business — the potential impact of such a program on environmentally sustainable farming is enormous. Clearly, Walmart is in a position to dramatically change the landscape, potentially for the better. Charles Fishman, in his book The Wal-Mart Effect, outlines the market-changing effects of Walmart's decisions – and brings home the point that whatever Walmart does has big repercussions. On the other hand, skeptics struggle to imagine how the world’s largest grocer, with one of the world’s biggest food supply chains, can ever actually implement true local sourcing.
In fact, the definition of true local sourcing is at issue. Walmart’s definition of what constitutes locally grown doesn't match the one promoted by the local food movement. Wamart defines local produce as that grown and sold in the same state. The definition most locavores — fans of locally grown food — use is food transported by farmers less than 50 miles away from where it was grown and sold in a farmer’s market. They say the quality of that kind of produce, because of being picked ripe and not sitting around in a retail store, is far superior.
So, yes, there is the matter of the taste and quality of the food. Perhaps Walmart will not compete with your local farmer’s market on this front, but what about Whole Foods? About a year ago, a writer for The Atlantic staged a ‘Great Grocery Smackdown’ — Walmart versus Whole Foods in a blind tasting — two complete sets of ingredients, prepared by a professional chef in simple recipes, to be judged side-by-side by a group of local food experts in Austin, Texas. The results were inconclusive — many of the Walmart dishes won. As Michelle Harvey, who is in charge of working with Walmart on agriculture programs at the local Environmental Defense Fund office, put it: “It’s getting harder and harder to hate Walmart.”
Still, one has to wonder what the new Main Street USA will look like once Walmart is done transforming it once again. They are, after all, still in business to make money. Big money. Beyond saving fuel costs on transporting produce across state lines, will Walmart find a way to tap into this consumer desire for closer connection with the products it buys? For more personal relationships with the people they buy from? How would Walmart create a farmer’s market experience? A mom-and-pop hardware store experience? Is there some Epcot Center version of Main Street USA waiting for us down the road, funded and managed by Walmart but dressed up to look like an olde tyme local towne? Is Walmart the evil empire pulling the wool over consumers’ eyes and offering them a second-rate version of ‘local’ or is it the savior of sustainable farming, bringing to bear it’s gigantic leverage for good? Whatever the answer, Walmart remains the bellwether of American consumer behavior, and so remains the one to watch.