Jeff Hirsh Read: April 2023
Inspiration: Wanted to learn about the history of Walmart and its founder
Summary
Written with the help of ChatGPT, below is a brief summary to understand what is covered in the book.
“Made in America”, published in 1992 by author and founder of Walmart Sam Walton, is an autobiography that provides a firsthand account of the rise and success of one of the world’s largest retail chains. Walton shares his entrepreneurial journey, from his humble beginnings in a small town to building a retail empire. He provides insights into his innovative business strategies, such as the focus on low prices, customer service, and continuous improvement. The book also delves into the challenges and setbacks he faced along the way, including competition, expansion, and management issues. Walton’s storytelling style and candid reflections make “Made in America” an engaging and inspiring read for aspiring entrepreneurs and business leaders, offering valuable lessons on leadership, perseverance, and innovation.
Unedited Notes
Direct from my original book log, below are my unedited notes (abbreviations and misspellings included) to show how I take notes as I read.
Sam Walton born into Great Depression in Missouri, main principle growing up then was the value of a dollar, inspired “frugal” habits, recognize everyone puts “trousers on one leg at a time”, Sam not see it necessarily as frugal—just think has what he needs (and even more) and over the top CEOs send a bad message, exercising your ego in public is not good for an effective organization, graduated U Missouri in 1940—first job was at JCPenney, always had numerous side jobs/hustles through college, important to Sam was knowing all names on campus from students to janitors, served in Army for a couple years and 1945 back and knew wanted to work for himself, had met wife Helen (whose distaste for big towns drove Walmart’s small town strategy eventually), bought a retail variety store in Newport, Arkansas that was struggling (town of 7k with a competitor in town) and dive in Sept ’45, Sam always checked in competitor’s store for prices/items on sale to see why doing better, within a few years turned 72k in sales store to 175k+, best selling variety store in region, focus was on keeping costs low and learned value of selling volume at a discount vs slightly higher price, however after 5 years had to leave as lacked renewal clause in lease, found store in Bentonville to open and remodel—Walton’s Five and Dime, self-service store (very new concept), open second in Fayetteville, always tinkering in store to move more volume, by 1960 had 15 stores but only doing $1.4mm in sales, Sam keen on partnership and allowing managers to buy stock, early in 60’s new discounters encroached on Sam’s franchised Ben Franklin stores, know had to go big and discount—tried to get partners but couldn’t so open own store Walmart July 2 1962–knew discounting was future and size of store was paramount, Kmart and Target also launch 1962 with much more backing but keep Walmart motivated to experiment, merchandise-focused (not operation focused, meaning only focused on costs), focus on promotion of products/can move things in big volume if promote well/realize what people want at low prices, as ramp with storecount distribution and warehousing key—Sam scrutinze all spending on tech/warehouse but by mid 60’s Walmart far ahead of retailers to lean into computers and tech, by ’69 had cutting edge communication across stores which was critical given in small towns spread out and need to be supplied properly, 1969 broach idea of going public, went public late in 1970 as a means to avoid personal debt and enable growth—great success though required lots of effort as lacked publicity given from Arkansas, held first of its kind annual meetings which were week long events in AK to show investors how they do things, Sam continue to target population under 5k/10k which no one else did, had opening model down, Sam was a pilot and wild flyover real estate to diligence traffic patterns/assess strength of location and pick where to open store—go direct to landowner once identify from plane, Sam’s real secret that took learning was that treatment of associates/employees determine treatment of customers and therefore success, ensure associates got share of store profits/paid well (initially not so) but learn not to be so frugal on payroll and bear fruit b/c happy associate treats customer well which drives repeat customer, repeat business is the engine/not just get in once, originally was just manager profit sharing but soon expand—Sam’s biggest regret was taking so long to share with associates, hard nosed relationship with vendors as always think about getting lowest price for customer, Walmart often viewed as small town killer but really create jobs, save people money, offer what they want/need, P&G and Walmart formed partnernship as first of its kind to change supplier/retailer dynamics—share info to max efficiency and reduce prices further in late 70s/80s, 1976/77 Kmart start to intrude a bit on Walmart towns to test strength and Walmart stand firm on lowest prices/keeping customers (Kmart was 10-20x the size of Walmart by sales), Walmart cross 1bn sales 1979, 1983 first Sam’s Club as recognize wholesaling opportunity direct to biz owners/bulk buyers at low prices (not original idea however, saw others doing), no frills simple business that people need for $25/year access to Sam’s Club warehouse with quality merchandise, became more acquisitive as well to get to new geographies east of the Mississippi, David Glass was distribution pioneer for WMT in late 70s, insist on owning/building distro centers and use own fleet (no third parties), enable control, communication, and flexibility to improve, 1960-1990 went from 9 stores to 1500, 1.4mm sales to 26bn and 112k in profit to 1bn, success of walmart fueled by tech systems in place and regular weekly sat morning sessions where dive in store by store with managers/associates invited, also insist on store level/department level responsibility and reward, store greeters came from local Louisiana store as idea to stop theft but also not scare people with a guard, Sam’s key business principles—commit fully to your idea/biz, share in rewards with all, communicate at all levels, reward/appreciate beyond $ (talk to people), listen to those around you, apologize not excuses, ultimately Walmart is a free enterprise success story that focused on its people/communities/customers first, disconnect b/w execs and their people is growing and damaging for all, need to lean into Walmart Way of prioritizing those who make you successful
