You can get to learn five business lessons from the self-made American entrepreneur and billionaire, Sam Walton who was best known for founding the one world’s largest corporations, Walmart Stores Inc.
Samuel Moore Walton (1918-1992) was once the richest man in America at a time. In 1945, he bought a Ben Franklin variety store in Newport, Arkansas, and began to put his own innovative retail approach to work.
He scoured the area with his pickup truck, buying up goods from anyone with a blowout offer to make. Then he sold them in his store, dirt-cheap. Merchandise flew off the floor. He’d make half the profit per item of comparable retailers, but sell three times as much and make a greater overall profit.
This simple but brilliant strategy enabled him to expand to fifteen stores in fifteen years’ time. Walton became the largest independent variety store operator in the U.S. When he started Wal-Mart in 1962, the lessons he learned from his success with Ben Franklin went with him.
It was some years before Sam Walton and his daring retail techniques that eventually led to revolutionizing retail distribution were taken seriously.
A few astute executives, like Harry Cunningham, then CEO of K-Mart, tried to warn his management early on that Walton posed a serious potential threat. They ignored his warnings and were caught with their pants down when Wal-Mart began to offer intense competition.
Sound all too familiar? Think right now about companies such as Nokia, HP and Blackberry. Alerts are everywhere that consumers are rapidly changing their technology habits, especially PC and smartphone use.
If companies don’t pay attention to potential threats in the marketplace, they will be shamefully left behind. Fortunately, Wal-Mart did not have this problem. Today, Wal-Mart has sales well over $400 billion and is still growing rapidly due to its rigorous global footprint.
If you haven’t read Sam Walton’s published memoirs, Sam Walton: Made in America, you should. Here’s just a sampling of his positive, creative thinking that we can benefit from as we grow our businesses from local to global:
1. On Wal-Mart’s key to success
“It (competitor’s poor profits) all boils down to not taking care of their customers, not minding their stores, not having folks in their stores with good attitudes, and that was because they never really even tried to take care of their own people.
If you want the people in the stores to take care of the customers, you have to make sure you’re taking care of the people in the stores. That’s the most important single ingredient of Wal-Mart’s success.”
2. On capturing ideas
“Go in and check our competition. Check everyone who is our competition. And don’t look for the bad. Look for the good. If you get one good idea, that’s one more than you went into the store with and we must try to incorporate it into our company.”
3. On ignoring others’ opinions
“If we fail to live up to somebody’s hypothetical projection for what we should be doing, I don’t care.”
4. On Sam Walton himself
“When Sam feels a certain way, he is relentless. He will just wear you out. Week after week after week—until finally everybody capitulates and says, well, it’s easier to do it than to keep fighting this fight. I guess it could be called management by wearing you down [MBWYD].”
5. On his employees
“I sure owe it to them to at least hear them out when they’re upset about something. Partnership involves money—which is crucial to any business relationship—but it also involves basic human considerations, such as respect.”
Why did Sam Walton succeed? Because he listened to himself, which most of us don’t do. Because he ignored negativity from critics, which most of us also don’t do. He parlayed his superior intuition and persistence into the largest discount retail empire in the world.
A gift of business genius like Sam Walton’s is one-of-a-kind, but we can all learn from his original philosophies and strategies as we work to turn our own dreams into reality.