Wrestling With Your Conscience

By Bill Saporito/Bentonville

Walk into most any Wal-Mart in the U.S. and here are a few of the things you can buy: condoms, birth control pills, hunting rifles, "Western" style toy guns, the movie There's Something About Mary, the National Enquirer, cigarettes, the video game South Park, the hard-rocking Powerman 5000's hit Tonight the Stars Revolt. And here are a few of the things you can't buy: a "day-after" birth control kit, handguns, authentic-looking plastic guns, Playboy, rolling papers, the movie South Park, the video game Grand Theft Auto and any number of rap CDs.

Inconsistent? Absolutely, and deliberately so. "We're a family store," says Wal-Mart CEO David Glass, and "we try to have something for everyone." And just as in real families, there is conflict about who gets what. Last week the company was pinned by a consumer who demanded that a World Wrestling Federation action doll be yanked from the shelves because both the wrestler it depicted, Al Snow, and the doll carry a prop that looks like a woman's severed head.

It was the latest in a series of controversies in which the company, by virtue of its enormous size and reach, has played an unwanted role as a sort of national conscience, discount division. Wal-Mart has been accused of being both censor and nanny, condemned as a promoter of demon rum and slave labor, and cited as both a friend and a foe of the environment. "We don't want to be America's moral conscience," says Don Soderquist, senior vice chairman. "The watchword for all of our people is 'Do what is right.' That's what we really preach and teach and we want, but there's so much gray."

And wherever there's gray, black, as in ink, is not far behind. Earlier this year, Wal-Mart infuriated some women's groups when it declined to stock Preven, an emergency day-after contraception kit available by prescription. Antiabortion groups hailed the decision as one for their side. But Wal-Mart's rationale was simpler--perhaps too much so: its pharmacies don't stock every drug available; Preven was going to be a small seller, customers were not clamoring for it, and the item was pricey ($25). "You can't carry everything. Sometimes you get credit for making a moral judgment when you're not," says Glass. Similarly, when Glass pulled handguns from the shelves in 1994, the company cited sales more than ethics, although he notes that by then there were more negatives in stocking handguns than positives.

Glass is certain that some of the books, videos and other products in the stores he would personally find offensive. He just doesn't know what they are. "When you have 100,000 unique SKUs," he says, using the retailer's term for an item--a stock keeping unit--"something is going to irritate somebody."

That would be, for instance, Kevin Clarke, a mild-mannered carpet salesman from Mentor, Ohio, and a loyal Wal-Mart customer, who went ballistic after his son bought a CD by a band named Godsmack that he thought God-awful, particularly a ditty called Voodoo, which seemed to be about suicide. Wal-Mart has long had a policy of banning so-called stickered CDs, those carrying a warning label that the content might not be suitable for children. But Godsmack was stickerless, so Wal-Mart stocked it, until Clarke hollered.

The music industry doesn't like Wal-Mart's policy, muttering under its collective breath about censorship and artistic freedom, but it won't buck the system. That's because Wal-Mart's reach is enormous, representing 10% to 15% of all U.S. CD sales. "It's very difficult to have a No. 1" without Wal-Mart, says a record-company executive. That's why even the biggest, baddest acts--Nirvana, Snoop Dogg--often clean up their acts to play Wal-Mart. But even that kind of screen isn't enough for parents such as Clarke, who hold Wal-Mart accountable for everything that ends up on the shelves: "They tout a policy that their stores are a safe haven, but they didn't honor it."

Wal-Mart has a clearly articulated view of its role in society and the economy--to be an "agent" for the consumer. The company views its job as finding out exactly what folks want and getting those products into the stores at the lowest possible cost. It's a strategy that has worked superbly. Wal-Mart earned $4.4 billion last year on sales of $139 billion. It serves 90 million to 100 million customers each week. So while Wal-Mart is a conservative company born of the rural South, it hasn't let that get in the way of some basic considerations of commerce. Years ago, church leaders were unhappy, and unavailing, when the company began to open its stores on Sundays. The customers, not any other authority, would be obeyed.

This kind of practical morality operates on a larger scale too. Take the sale of alcoholic beverages. Wal-Mart does not sell beer and wine in its traditional discount stores. Yet if you walk into many Wal-Mart supercenters, stores as big as 220,000 sq. ft. that combine a supermarket with a traditional Wal-Mart, you'll find plenty of Budweiser to put in the coolers being sold in sporting goods. Wine and beer are also sold in Sam's Clubs and in the company's new chain of downsized Neighborhood Markets, a.k.a. "small marts."

Why the distinction? Wal-Mart executives attribute the decision to the customers, who say they expect to be able to buy beer and wine in supercenters just as they do at competitors' stores of a similar type. Yet booze will remain verboten in fuddy-duddy old Wal-Mart discount stores. Explains Glass: "What's the difference between selling in a supercenter and a Wal-Mart? I can't tell you I can give you a definite answer. But I can tell you that I have a rationale for it." Nevertheless, within the company and without, there was muttering that Sam--Wal-Mart's late founder, Sam Walton--wouldn't stand for such a thing. Wrong, says Glass. Sam knew better than to buck the customers.

Hence, Wal-Mart is well stocked in inconsistencies. South Park, the cartoon television series and recent movie, features a funny but foulmouthed cast of characters and an infinite collection of toilet jokes. The South Park video game got to the shelves but not the film. Reason: Wal-Mart's game buyer figured that customers who purchase it are already familiar with the characters. The video buyer, on the other hand, believed that customers associate animated films with movies such as Bambi and not with Cartman and his profane pals. (No doubt the boys would have joyously killed and consumed Bambi.)

In Wal-Mart's world, there is accounting for taste. For instance, the video section stocks the risque comedy There's Something About Mary. And there's something in it that more than a few folks would find objectionable. Says movie buyer Eddie Tutt: "It's pretty crude, but [the movie] did $175 million in sales, which kind of tells you that most of the public looked at it and probably felt good about it." Which tells Tutt that unlike, say, Howard Stern's crude movie, Private Parts, which Wal-Mart did not carry, Mary will light up the cash registers.

Yet Wal-Mart customers are not of one mind on some of society's more complicated matters, as it learned with Preven. The primary ingredient in Preven is ethinyl estradiol/levonorgestrel--the same as in birth control pills--given in a high dose. The package also contains a pregnancy test. Although Wal-Mart wouldn't stock Preven, it has always sold birth control pills.

Earlier this year, Planned Parenthood sent women to Wal-Mart stores with "emergency" prescriptions for birth control pills, not Preven by name. A few pharmacists refused to fill them, some apparently under the false impression that these drugs will terminate a pregnancy, as opposed to preventing one.

Planned Parenthood pressed the company for a clarification on its pharmacy policy. Wal-Mart then sent a directive to each of its pharmacists requiring them to fulfill any emergency prescription, which is consistent with the American Pharmaceutical Association's code of ethics. Any pharmacist whose personal beliefs prevented him from filling such a prescription must find someone who will. So day-after contraception is available, even if, for business reasons, Preven is not. "We don't care what their motivation is," says Gloria Feldt, president of Planned Parenthood, who gives the company good marks for its responsiveness. "Our concern is that women can get emergency contraception."

The Preven controversy, among others, has prompted Wal-Mart to reconsider some of its laissez-faire policies. The company recently established an ethics committee, to which buyers and other Wal-Mart employees can refer any knotty issue. As Wal-Mart continues to grow internationally, the committee will no doubt get busier. Certainly the medical-ethics front will get murkier. "We are only at the tip of the iceberg," says Soderquist. "There will be lots of issues that will come up: suicide pills, genetic engineering. Can they prescribe pills that alter the genes?"

And even before we get there, the nation's biggest shopkeeper will be less able to stick to its preferred role as an agnostic buyer for the masses. There's a world full of outraged parents, students, environmentalists, activists, politicians and stockholders complaining with equal fervor about the silly and the serious. Says Glass: "The public in general becomes a little harder to serve all the time. But you have to respond to that." In other words, Wal-Mart is no longer a free agent.

--With reporting by David E. Thigpen

With reporting by David E. Thigpen