The Chicago City Council approved a zoning change that will allow Wal-Mart Stores, Inc. to build its first store in the Windy City. The council voted 32-15 to allow Wal-Mart to revamp a vacant Helene Curtis shampoo factory and build a 150,000-sq.ft. store on the west side of town.
According to the Atlanta Journal-Constitution, Wal-Mart officials have been looking in Chicago for a space that would accommodate the store's size, and it is part of the retailer's strategy to penetrate urban markets that company officials have deemed underserved. "Wal-Mart is very excited," said John Bisio, Wal-Mart's regional communications manager for the Midwest. "It's a big victory for our customers."
The company also wants to build in Chicago as an example of what is possible in other major cities. "This is a sophisticated, complex city. It's new territory for us," Bisio said in USA Today
The council, however, rejected a second vote 25-21 to build a 50-acre shopping center on the site of a former steel mill on the south side of Chicago, which would also include an Office Depot and Lowe's home-improvement store. But the plan for that store may be brought up for another council vote as early as June 23, 2004.
Opponents say the 150,000-sq.ft. store will bring congestion to the neighborhoods and hurt small businesses that cannot compete with the discounts Wal-Mart offers. Union leaders say that Wal-Mart associates are underpaid and overworked. "Wal-Mart has a well-documented history of violating workers' rights and devastating communities with its predatory practices," said Elizabeth Drea of Local 881 of the United Food and Commercial Workers in USA Today.
Wal-Mart launched a lobbying campaign to overcome the opposition. The retailer used a telephone bank to connect people who said they supported the stores directly to 11 aldermen's ward offices. The supporters were found by pollsters hired by Wal-Mart who called hundreds of Chicago residents. Wal-Mart found that 72 percent of those polled supported the company.
According to the Chicago Tribune, Ald. Leslie Hairston (5th) said her south side ward office was inundated with calls from constituents saying they were forwarded there by telemarketers who asked whether they supported new jobs in their communities. Callers were unaware that they were calling their aldermen about Wal-Mart's plans to open stores.
"This is obviously going to affect my vote," said Hairston, who voted yes to the west side store but no to the south side store. "I resent them misleading the public. I don't like what they did to the residents of our ward. If this is how they plan to do business in Chicago...I'm not supportive of that."
"We have not done a good job countering the assertions, claims and innuendoes, and that has created a sort of conventional wisdom," said Bisio in USA Today. "We have to convince (cities) we are not the evil empire."
Supporters of Wal-Mart say the city needs the jobs the stores would bring. Chicago Mayor Richard Daley has said Chicagoans spend $500 million a year at 53 Wal-Marts and Sam's Clubs in the metro area. "They are building all around the city," said Daley in USA Today. "Why can't we have one?"
Although Daley voiced support for Wal-Mart (According to the Chicago Tribune, the law firm of his brother Michael Daley lobbied for the west side Wal-Mart), he noted that the company must become a better corporate citizen. Wal-Mart has promised to contribute to community and youth programs, as it does in other cities. According to USA Today, the retailer donated $150 million last year to public service projects in communities across the nation. According to the Chicago Tribune, Wal-Mart promised the City Council to find minority subcontractors to help build its stores and to do its best to fill 75-80 percent of the 500 jobs in those stores with local residents.
"Chicago is an extremely important market to us," said Bisio in the Chicago Tribune. "We welcome the close scrutiny that our first Chicago stores will be under and believe our actions will speak louder than words."
In other Wal-Mart news, the discount store's ever-expanding reach may now include Europe, according to The Financial Times. Representatives have announced that the retailer wants to have a store in every European country via its United Kingdom subsidiary Asda, either through large acquisitions or the opening of its own stores. All European countries are being considered as desirable acquisition targets.