Love it or hate it, most people in today’s society are familiar with the name Wal-Mart. I personally am not a fan of the company itself (especially since I work for one of their direct competitors), but I do admire Wal-Mart’s founder, Sam Walton and some of his business tactics. Recently I did a little research to learn more about him. Here are 5 things that I learned about Sam Walton and how he managed his finances and became one of the most influential men in the world:
1. He was versatile. In Sam’s younger life, he held many different jobs: paper boy, waiter, magazine subscription salesmen. He did this as a way to support his family and make it possible to put himself through college. Being versatile helped Sam later on, when he was developing the Wal-Mart brand. When he faced challenges for being successful (the owner of the franchise did not want Sam to keep owning it, because Sam was making the owner’s son look bad), he overcame them (instead of complaining or bending to the will of the owner, he bought him out for “a fair price” and used the stores’ contents to start his own five-and-dime). Because he was able to roll with the punches and keep going, he was able to expand his business.
2. He wasn’t afraid to take calculated risks. In order to start his own five-and-dime, he had to borrow money from his wife’s parents. This could have put a lot of strain on the social relations of the family, but he was certain enough that his business would make money so that he could pay his father-in-law back easily. Although Walton made many other risks in business, this early decision was crucial – not only was business on the line, but family relations as well. Sam trusted himself and the business enough that he made it happen.
3. He encouraged others to succeed. Sam offered incentives to his management teams and encouraged them to be active participants in the company. This encouraged his managerial staff to push themselves to become better and more effective managers and take ownership and pride in their work. By encouraging others to be successful, oftentimes we can gain some of the benefits (even if it is not financial. Knowing that you helped someone reach their full potential can make you feel successful, too).
4. He lived simply and within his means. Famous are the stories of Sam driving from store to store in his old, beat-up pickup truck or bending down to pick up pennies off the ground. Even though he was a very wealthy man and could have disregarded these practices, he didn’t. He tried to live a relatively simple life compared to his income and not exceed his means. He wasn’t out to impress anyone with material possessions, he was out to do good business.
5. He was innovative. These days, no one thinks twice about a superstore that has everything you could want in it – furniture, household goods, groceries, clothing, entertainment, etc. However, when Sam opened his first superstore, it was novel. He also wanted to see his shelves full at all times – that way, someone was more likely to impulse buy it. He also went against the typical culture of retail at the time – he wanted his store located in small towns. He strategically placed his stores within a days’ drive to the regional warehouses so that stock could readily be available. He wasn’t afraid to go against the curve and try something new, and it usually worked.
Personal opinion alert: I think that some of the principles that Sam Walton instituted within the Wal-Mart brand are gone now – how many times have you been to a Wal-Mart and they didn’t have what you wanted in stock? However, the ideas that made Wal-Mart the company that it is today are still good ideas. Sam Walton was a smart business man. There are many good traits that can be taken away from Sam’s legacy, but these 5 were probably my favorite.