A Wal-Mart Becomes a Lifeline
By Brian Grow
When the hungry man threatened to get his gun if Wal-Mart's doors didn't open the day after Hurricane Katrina smashed through town, store manager Ray Mathews knew he had trouble. The storm had shattered skylights and flooded the west end of his Wal-Mart Supercenter in Columbia, Miss., 20 miles north of the Louisiana border. The lobsters had died, and the meat and the vegatables were spoiling as the power was out.
Mathews couldn't reach most of his 400 workers, either. They were largely stranded when the storm ripped open their homes, knocked down trees, and shut down area gasoline stations. Now, desperate local residents who depend on the Wal-Mart (WMT ) in this remote town were knocking loudly on locked doors.
"A BIT OF CHAOS."
The threatening man eventually went away. But the woes brought by Katrina to this one store lingered. When a reporter arrived in Columbia on Sept. 2, the store had been open just a few hours. But the Wal-Mart gas station in the parking lot, where unleaded gas sells for $2.45, had reopened two days earlier, powered by a newly arrived generator. The lone fuel outpost for 30 miles, cars flocked to the eight pumps.
But fights broke out and one man pulled a knife, according to a local sheriff. That, plus other lootings and thefts in Columbia, had prompted the mayor to declare martial law and impose a dusk to dawn curfew. "It has been a bit of chaos," says Mathews, a 19-year veteran of Wal-Mart, who's known to workers and customers alike as "Mr. Ray."
So unfolded the struggle to reopen one Wal-Mart in a town clobbered by Katrina, a scene being repeated at businesses throughout the ravaged region. The storm knocked out 126 of the retailing behemoth's stores in the Gulf Region, but by Sept. 6, all but 17 (and a corporate facility) were back online. Wal-Mart -- which has 3,800 locations nationwide -- says sales figures for September are likely to be within its previously announced estimate of a 2% to 4% increase in stores open at least a year. But it left open the possibility that Katrina's lingering effects, plus a rise in gas prices, could still have an impact.
While Wal-Mart's corporate relief effort enters overdrive -- the Bentonville (Ark.) giant says it's donating $17 million to Katrina relief and handing out free merchandise across the Gulf Coast -- the rebound in Columbia is, in many ways, a more revealing story. It's a little lesson in what oft-maligned Wal-Mart can, sometimes, mean to communities. To the 6,500 people of Columbia, a quiet place where annual income averages $20,000, it's a lifeline. "Wal-Mart's the place," says Cheryl Jacobs, a Columbia resident who found herself without power or water after the storm.
That's a sentiment not lost on Mathews, 57. A hyperactive Air Force veteran who served two tours in Vietnam, he has run Wal-Mart operations in Columbia for 14 years. He's devoted. In the parking lot, the staff room, and the grocery aisles, he barks almost-constant orders into his walkie-talkie -- and listens for relief updates on a police radio given to him by the city.
The night before the storm, he and a cadre of assistants piled hundreds of pounds of meat into shopping carts and loaded them into a walk-in freezer, in a futile bid to save some food. Then, Mathews stood up his wife in favor of riding out the tempest at the store. (His house was one of the few in town to escape without serious damage.)
The day after Katrinia hit, Columbia, which was ravaged by wind and rain but fortunately not by flood waters, began to dig out. Downtown, Columbia's city administration had just finished a $500,000 renovation of sidewalks and storefronts. Now, they were in tatters. The storm had ripped off the brick front of the Foxworth & Shepard law firm office.
Prisoners from the local jail dressed in black-and-white striped uniforms hauled away debris, under guard. On side streets, hundreds of shredded trees clipped power lines and damaged roofs. Cozy, well-maintained neighborhoods resembled logging sites. "It looked like a bomb went off," Mathews recalled Friday, leading a visitor on a tour of the town.
That same Tuesday, however, he had shifted into high gear. Mathews placed an order for trailers full of water, canned meats, juices -- and a giant Caterpillar (CAT ) generator. Repairmen put temporary plastic shields on the store's broken skylights. Employees eager to find out what was happening in the outside world stumbled in. "We had no idea about anything until we came in here to work," says Willie Nell Binkley, the housewares department manager, who tracked down her missing daughter using a store phone. "We couldn't have done this without Wal-Mart."
A KILLER VIEW.
Clearly, camaraderie inevitably rises in a crisis. But at this Wal-Mart, the loyalty seems fierce. Josh Parish, 24, manages the tire and lube department. He never went to college, instead he went to work for Wal-Mart out of high school. He's tickled at the chance to travel now -- twice, Wal-Mart has sent him to headquarters in Bentonville. The staff, he says, is "a family."
Last Friday night, looters stole furniture from the porch at Cyndee Moree's father's house. "I'll kill 'em," says Moree, a support manager. Mathews gently warns her against such harsh language. "I'll go out there and show myself butt-naked. That'll kill 'em," she says with a chuckle.
Not that dissent entirely disappeared. Even after a storm, the Wal-Mart empire remains bureaucratic. Last Tuesday, Chief Executive Lee Scott told BusinessWeek in an interview that the storm had caused "simple human tragedy" and he was deeply concerned about Wal-Mart workers. The company has offered to find displaced employees jobs at other Wal-Mart locations, and it offred a one-time cash payment to help employees get by -- $250 in cash relief upon request, and an additional $750 in cash if a home was damaged.
20 AT A TIME.
In Columbia, employees still have jobs. But the staff room is covered with signs warning workers not to wear jeans and not to forget to pay $3 for seconds on company-supplied meals. Says Daphne Regan, a door greeter: "They don't respect the workers."
Mathews, however, has no time for gripes. By Thursday, the Caterpillar generator had arrived, a house-size behemoth sucking up 100 gallons of fuel an hour. Electricians rewired the store to hook it up. Water arrived, too, and staff began piling cases of the precious liquid -- $1.47 each -- in aisles.
That night Mathews put up a sign in the window: "We will open at 9:00 a.m. to 5:00 p.m. Only 20 customers in at a time." On Friday and Saturday morning, eager customers were lined up 100 deep at 7 a.m. One, Tammy Alexander, trekked 40 miles north from Angie, La., where there's no water, ice, electricity, or gas. "We ain't got nothing," she says.
By Friday morning, 100 cars were in line for gas at Wal-Mart, which is restricted to employees, soldiers, and hospital workers. A lone taxicab stuck out of the crowd The driver, Harry Smith, his two daughters, their boyfriends, and a puppy aren't in those categories. They fled Jefferson Parish, southeast of New Orleans, the day before the storm, then holed up at a friend's house near Columbia. Katrina toppled dozens of trees, trapping them.
They cut their way out, and now the only place to go is Harry's sister's house in Montgomery, Ala., about 300 miles away. They needed gas to get there. "You don't know how hard it is," says Smith, crying. With a pained look, Mr. Ray waved them through to the pumps, where gas was still selling for $2.45 a gallon.
Grow is a correspondent in BusinessWeek's Atlanta bureau
Edited by Phil Mintz