4 Lessons from the Life of Walmart’s Founder Sam Walton
In 1950, Sam and Helen Walton moved from Newport, Arkansas, to Bentonville, Arkansas where Sam soon opened a dime store on the city’s square. His business blossomed and in 1962 he opened his first Walmart taking the company public in 1970. Today, there are 11,500 retail units under 72 banners in 28 countries. The lessons that allowed Sam to grow the business are lessons that will help you manage your own business’s reputation.
While still just a dime store, a customer entered Sam’s business needing some white paint. There was none to be had in the store, however, Sam knew that there would be some on the truck to arrive later in the day. He told the customer that once the paint arrived, he would bring it to his house. That is exactly what Sam did, along with a new paint bucket and a package of brushes. Sam knew that keeping this customer happy so that he would return to the store again was worth far more than giving the customer the paint bucket and brushes for his inconvenience.
It is an important lesson that you can carry into your own business practices. Give the customer more than they expect and they will return many times. Likewise, they will tell their friends how great they were treated by your company. Then, should someone try to tear down your company, you have a host of people to defend your company.
From that humble beginning, Walmart has grown into a company that had $35.1 billion dollars in gross profit for the first quarter of 2016. The reason that they were able to make this profit is that people have learned that they can trust Walmart to have what they need at reasonable prices. You also need to build that same trust in your customers if you want to build a strong reputation.
The third lesson that you can learn from Sam Walton is that he took the time to listen to his customers. As his empire began to grow, Sam understood how important it was to listen to customers and those who worked directly with the customers on a daily basis. He spent hours driving his old red pickup, along with his dog, to various stores throughout the country to visit with people. When the chain grew to big for him to get around in his pickup efficiently, then he flew his own small airplane to various cities.
Since he could never understand aerial maps, he flew over the highways that he used to drive to arrive at the stores. You need to remember Sam’s point. Get out of your office and listen to the people adapting to meet their needs because the customer is your real boss.
Finally, hire the best people that you can hire and reward their loyalty. Sam’s first cashier was great at customer service and he knew it. He hired her as an 18 year old kid. When she got ready to retire, she was a millionaire. Walmart still makes that possible. For example, pretend that you are an assistant manager at Walmart and married to another assistant manager. You both make $58,000 each year choosing to invest $1,800 a year in Walmart stock purchases.
Since the company matches it at 15 percent, they buy $4,140 worth of shares each year. They both invest $3,480 in their 401k which the company completely matches. Based on long-term averages, they will retire with nearly $4.9 million in their investment accounts. Richly rewarding the people who work for you is a great way to hire good people and build your company’s reputation.