Wal-Mart: Off with Their Smocks!

As part of an ongoing effort to improve its image, workers at the retail giant's stores will soon be sporting a more modern look. Just don't call it a uniform

Over the coming weeks, Wal-Mart (WMT) will make the first change in four decades to its employee dress code at 3,400 stores nationwide. Out are the company's familiar blue smocks with the smiley-face logo. In are dark blue shirts and khaki pants. Just don't call the new look a "uniform." In a memo sent to managers and reviewed by BusinessWeek, the company states, "The new dress code is not a 'uniform.'"

The makeover is clearly about more than clothes. Wal-Mart wants to change attitudes along with shirts. The company has taken heat for its pay and benefits practices. And it wants to remake its image as a more fashion-forward retailer to increase sales growth at the $350 billion behemoth. "Our research shows that our current dress code is out of date, having a negative impact on how customers perceive our associates compared to other retail employees," reads the memo to managers. Workers will receive two free navy blue, short-sleeve polo shirts each and an additional $15 to purchase khaki pants. All employees hired before Apr. 13 are eligible. They will have to pay income tax on the value of the shirts, a total of $15.64 for the pair.

Movin' on Up?

The change is part of a broader effort to move upmarket. Wal-Mart has remodeled 1,800 stores to improve the shopping experience by adding vinyl wood flooring and more modern restrooms. In the past year, the company introduced the new women's fashion line called Metro 7, more organic foods, and a broader lineup of flat-panel TVs and electronic goods.

Chief Executive Lee Scott admits that the shift has been challenging. "We are defined by our customer, not by us," he said in a recent BusinessWeek interview (see BusinessWeek.com, 3/30/07, "Wal-Mart: 'On the Side of the Angels'"). "And we can't wake up one morning and say we're going to be something different and something more to you and not earn it. We just can't."

John Simley, a spokesman for Wal-Mart, says that the new dress code "fits in very nicely with our investments in improving the customers' shopping experience. In our surveys with associates we got 95% positive response to the new dress code." Simley says that the clothes are not called uniforms because there's flexibility in how associates wear them, in terms of a color palette. Indeed, the manager memo spells out that employees "will wear solid dark blue shirts with solid light tan to dark brown pants or skirts." The stores have 10 weeks to transition to the new dress code, and the memo states that they "should be in compliance prior to June 18."

Carefully Chosen Words

Rachelle Smith, who stocks shelves at the Wal-Mart store in Hammond, La., says she likes the new clothes just fine. But she is already a tad nostalgic for the old look. "I miss my smocks," says the 30-year-old mother, who earns $9.69 an hour. She did chuckle at Wal-Mart's characterization of the changeover: "They can call it a dress code all they want, but that doesn't change what it is, which is a uniform," she says.

Outsiders were surprised that Wal-Mart would try to control even the term used to describe the outfits employees wear. "Wal-Mart is genius at this kind of Orwellian language," says Jonathan Rees, associate professor of history at Colorado State University in Pueblo, Colo. He pointed out that Wal-Mart also insists on using the term "associates" for all its employees. "What might be obvious to anybody with a thinking brain is something else to Wal-Mart."

Damage Control

Wal-Mart has been particularly sensitive about its image of late. There have been revelations recently that the company has a Threat Research & Analysis Group, which monitors its own employees, as well as outside consultants, investors, and members of the media. Wal-Mart stepped up its efforts in this area following leaks of executive memos in the past couple of years that revealed, among other things, that the company planned to pare costs by cutting staff from an 80% full-time workforce to 60%. The company has also in recent months become a political target of politicians including Senator Barack Obama (D-Ill.) and former Senator John Edwards. "The reason why people leak is that they are unhappy," says Rees. "Instead of fixing the problem, Wal-Mart is wasting money on things like surveillance." (See BusinessWeek.com, 3/22/07, "Wal-Mart: Thanks for the Bonuses, But….")

But Wal-Mart clearly hopes that the updated employee outfits will help, at least a bit, in buffing its image. Workers seem to be pleased with the change. "I will miss the pockets in those smocks, where I used to keep my box cutters, my little sales book, and notes from the boss," says Nell Harris, a 76-year-old manager in the electronics department of a Wal-Mart store in Covington, Tenn. "But I do love the new look."

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