Walmart Meets Katrina: Responding to Catastrophe

September 13th, 2005 by

The Insider has been pretty tough on Walmart, and for good reason. In their passionate pursuit of lower costs, they squeeze vendors, they squeeze contractors, they occasionally lock cleaning crews into the buildings at night, and. perhaps most egregiously, they squeeze their own employees to the point where many require public assistance to survive. In his invaluable book, The World is Flat, the brilliant Tom Friedman details the many reasons why Walmart is in the forefront of today’s business models. They are really good at a lot of things. Friedman attributes the company’s tin ear on issues of worker fairness to their rural Arkansas origins. I suspect that Friedman is implying that they do what they do because they are rednecks. Maybe so, but they are rednecks with dazzling business acumen.
It would be foolish to question the efficiency of the Walmart model. This efficiency came into dramatic play in the days following the disastrous landing of Katrina. No one was better than Walmart at analyzing and delivering the goods that are most needed in the storm-ravaged regions of the south. Whatever we may feel about the impact of Walmart on small town America, there is little question that the world’s biggest retailer is uniquely situated to analyze post-hurricane needs and deliver the goods. It would be nice if FEMA could do the same, but they certainly can’t under the current inept leadership, and it’s hard to imagine any government program matching the efficiency of a Walmart.
Friedman’s book, written prior to Katrina, outlines the Walmart scenario for responding to lesser storms:
During hurricanes…Walmart knows that people eat more things like Pop-Tarts — easy-to-store, nonperishable items — and that their stores also sell a lot of kid’s games that don’t require electricity and can substitute for TV. It also knows that when hurricanes are coming, people tend to drink more beer. So the minute Walmart’s meteorologists tell headquarters a hurricane is bearing down on Florida, its supply chain automatically adjusts to a hurricane mix in the Florida stores — more beer early, more Pop-Tarts later.
We read at Investors. com that Walmart has given generously to relief efforts