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Wal-Mart's frenetic growth has made the company a star on Wall Street, where its stock has skyrocketed almost nonstop since it went public in 1970. An original investment in 100 shares, which sold for about $1,650 back then, would be worth more than $700,000 today.
Even so, a first-time visitor to a Wal-Mart store is likely to be underwhelmed initially. The outlets are mostly linoleum floored and arrayed with row upon row of simple racks and counters, punctuated by signs pointing to particular bargains. But the no-frills atmosphere suits the predominantly blue-collar clientele just fine. From shotgun shells to laundry soap, most products are well-known brands at deep discounts. Wal-Mart, unlike many other discount outlets, offers more: well-scrubbed aisles, fully stocked shelves and relentlessly upbeat clerks. "It's attitude," explains Wal-Mart Vice Chairman Jack Shewmaker. "Give me workers with the right attitude."
The fervor among Wal-Mart's 151,000 employees is inspired by a Walton philosophy in which ideas and profits are freely shared. All store employees, even the lowliest shelf stockers, are given the title "associate." Wal-Mart operates a liberal profit-sharing plan (1986 disbursements: $52 million) and offers bonuses for specific accomplishments like reducing pilferage. Workers are exhorted to make suggestions. "Most of the good ideas come from the bottom up," says Wal-Mart President David Glass. "We keep changing a thousand little things."
Wal-Mart now has tremendous momentum, but the founder is still a prime force. The son of an Oklahoma farm-mortgage broker, Walton earned an economics degree from the University of Missouri and joined J.C. Penney in 1940 as an $85-a-month trainee. After serving in the Army, he pooled his savings and borrowed $25,000 to buy a Ben Franklin store in Newport, Ark., in 1945. By the late 1950s he owned more than a dozen similar stores, but decided that the future was in discounting rather than in five-and-dimes. After studying a K mart in Chicago, Walton and his younger brother James, now a company senior vice president, opened the first Wal-Mart Discount City outlet in 1962, in Rogers, Ark. At the turn of the decade his stores had spread to more than 30 locations.
Today visitors to Wal-Mart's plain, red brick offices in Bentonville soon get an insight into how Walton manages to offer such low prices. The company's frugal quarters are outfitted like a bus station, complete with plastic seats. The chairman's office, covered in bargain-basement paneling, is appointed mostly with strewn-about books and computer printouts.
Humility is Wal-Mart's watchword, which filters down from Mr. Sam. The billionaire, whose family owns 38% of the company's stock, lives in Bentonville with his wife Helen in a modest brick-and-wood ranch-style house. Their names are on the mailbox, and it was only a few years ago that they installed a security system. All their children, three sons and a daughter, are grown. Walton typically rises before dawn and eats breakfast at the Ramada Inn coffee shop on his way to work. Along the way he may stop at Barber John Mayhall's for his monthly haircut, for which he pays $5 (no tip). While Bentonville offers few diversions, a favorite Friday-night spot for the Waltons is Fred's Hickory Inn, known for its ribs and cheesecake.