Wal-Mart Faces Stringent Opposition in California Markets

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Wal-Mart Faces Stringent Opposition in California Markets

MARTINEZ, Calif. -- Wal-Mart Stores Inc. is continuing to run into resistance in California where rising concerns about reducing traffic and preserving open space clash with the mass merchandisers desire to build its supercenters nearly twice the size of its typical store.

Fast-growing Contra Costa County, with nearly 1 million people, already has banned the supercenter concept -- a precedent that Wal-Mart is seeking to overturn at the ballot box. In Los Angeles, California's largest city, officials are in the early stages of discussing an ordinance that would block or discourage Wal-Mart from opening supercenters there, The Los Angeles Times reported.

The opposition hasn't blanketed the entire state. Wal-Mart's first supercenter in California is expected to open next year in the booming desert city La Quinta, followed by others in Bakersfield, Hanford, Chico and Redding. Still, the pockets of resistance underscore the challenges facing Wal-Mart as it pursues plans to open 40 California supercenters during the next four years. Bentonville, Ark.-based Wal-Mart already operates 134 of its traditional stores in California.

California represents the last frontier for Wal-Mart's supercenters -- stores that contain full-service grocery departments. To accommodate all the food, the supercenters span an average of 187,000 square feet compared to an average of 97,000 square feet for the typical Wal-Mart discount store. Since Wal-Mart first introduced supercenters in 1998, the concept has turned into its crown jewel. The company runs 1,258 supercenters in 43 states, up from 441 supercenters in 28 states five years ago.

Supercenters "have been extremely successful for them," said Kurt Barnard, an Upper Montclair, N.J., retail analyst who has been following Wal-Mart for 40 years. "I would expect Wal-Mart to make sure the supercenters get built in California and then make them indispensable for millions of consumers. They are a very determined company."

While Wal-Mart hails the supercenters as the ultimate in shopping convenience, opponents attack them as monstrosities that attract too much traffic, create too many low-wage jobs and destroy neighboring businesses, the report said. The criticism has dogged Wal-Mart for years, and stirred community opposition in several other states, including Oregon, Arizona and Nevada.

But the critics may find an even more receptive audience in California, where congested roads and sprawling developments have emerged as major irritants.

The supercenters also face fierce opposition from a longtime Wal-Mart foe -- the United Food and Commercial Workers, which has more than 200,000 members in California. The UFCW and other labor leaders fear nonunion supercenters will pressure traditional supermarkets to lower wages or fire well-paid workers to remain competitive. Wal-Mart regards much of the criticism about its supercenters as "ludicrous," spokeswoman Amy Hill said.

But Wal-Mart is taking Contra Costa's snub seriously, even though the company has no plans to open a supercenter in the unincorporated areas affected by the ban. "This is a direct threat to our business. It's a matter of principle for us," Hill said.

The company spent about $100,000 collecting 40,735 voter signatures to qualify for a referendum seeking to overturn the Contra Costa ban. Wal-Mart is prepared to spend even more in the campaign leading up to Contra Costa's still-unscheduled election, Hill said. The company's pockets are deep, having generated an $8 billion profit last year on sales of $245 billion.

Wal-Mart's ballot-box defense of its supercenters has proved effective in other communities. The company spent $140,000 last year to defeat a measure that would have banned a supercenter in Calexico, a border town of 27,000 people. The Southern California city of Inglewood and Nevada's Clark County repealed supercenter bans after Wal-Mart qualified voter referendums to take the issue to the ballot.