The value of building permits in Fort Smith, Greenwood and Van Buren were a combined $16.345 million in the month of May. The total represents a decline of 52.76% when compared with May 2013, which itself was a standout month for the year overall when looking at building permits.

So far, year-to-date figures are only slightly higher than the same period for last year. Building permits in the three cities were a combined $81.295 million for the period, an increase of 0.81% over the same five month period last year, which saw building permits total $80.643 million.

FORT SMITH
The city of Fort Smith issued 180 permits during the month of May, totaling $13.494 million. The figure represents a decline of 55.77% over the same month last year, when 206 permits worth $30.506 million were issued.

May 2013 represented a month full of several commercial projects, including a new $13.6 million pumnp station on Jenny Lind and a $1.986 million of the Phoenix Expo Center. The former expo center was converted to office space for HMA, the parent company of Sparks Health System. The office complex has since opened with hundreds now employed at the site.

By comparison, last month only saw one commercial building constructed at a cost of $1.051 million with 15 remodels, which only totaled $6.127 million. In all, only $9.354 million worth of building permits were issued on 25 projects.

GREENWOOD
The city of Greenwood saw the most improvement of all three cities, with five permits issued with a value of $532,466. During May 2013, no permits were issued in the city.

But the figures are still down when compared with May 2012, when five permits were issued at a value of $733,540. The latest total represents a decline of 27.41% decline between the two years.

VAN BUREN
Van Buren saw $2.319 million in building permits issued in May, a decline of 43.387% from May 2013.

The $3.164 million expansion of Tankersley Foods was the primary driver of last year's figures.

Driving figures in May 2014 is a $2 million commercial building project at 323 Access Road. The site was once a small distribution center for Yellow Freight, though the site has been closed with little activity since being bought by Southeastern Freight.

According to Service Center Manager Scott Lackie of Southeastern Freight Lines, the company is renovating the site and anticipates moving its 38 employees from its Fort Smith service center to the Van Buren location by the end of the year. He said any additional hiring for the site would depend on freight levels at the facility, though Lackie said the maximum number of employees the Van Buren site could accommodate would likely be around 40.

2013 RECAP
Combined values in the three cities during 2013 were $203.037 million, compared to $157.32 million during 2012. The 2013 value is above the $201.079 million in 2011.

Fort Smith closed 2013 with the largest share of valuations, logging $177.687 million (a one-year increase of about 30.24% from $136.428 million in 2012), while Van Buren was the next largest with $17.067 million (a one-year increase of 38.96% from $12.282 million in 2012). Greenwood posted an additional $8.283 million, the only city to show a decrease from the previous year's total of $8.609 million (a decrease of 3.79%).

The gains in the Fort Smith market were largely from industrial construction projects at Chaffee Crossing, the construction of Mercy's new orthopedic hospital along Phoenix Avenue and various municipal construction projects across the city.

As spending holidays go, Father’s Day pales in comparison to Mother’s Day ($19.9 billion) or Christmas ($602 billion), but consumers are still expected to dole out an average of $113.80 on dad ahead of the June 15 holiday, according to the National Retail Federation.

The NRF survey conducted by Prosper Insights & Analytics expects 5% less in the average spend from a year ago, with total retail receipts of $12.5 billion this year.

“Knowing both cost and sentiment are important to their shoppers, retailers this Father’s Day will make sure to offer promotions on a variety of gift options, including home improvement items, tools and even apparel,” said NRF President and CEO Matthew Shay. “As more people look for ‘experience gifts’ with tickets to baseball games or a day on the golf course, retailers will also make sure to promote their gift cards for families hoping to create the perfect gift package.”

Greeting cards are a popular way to thank dad with 64% of consumers planning to purchase a card, while four in 10 said they plan to buy dad some new apparel this year for a total expended spend of $1.8 billion on clothing items.

Another $2.5 billion will be spent on outings to sporting events and $1.6 billion will be doled on electronic gadgets. Plenty of consumers want to give dads a chance to choose their own gifts with $1.8 billion in gift card purchases expected.

One in two consumers will shop for dad this holiday with one in four wives also looking for ways to show appreciation for their husbands.

“As we saw with Valentine’s Day and Mother’s Day this year, consumers are keeping to a strict budget,” said Prosper Insight’s Consumer Insights Director Pam Goodfellow. “Whether they spend $10 or $100, millions of Americans will find creative, affordable ways to show dad how much they care.”

Other Father’s Day Spending
$663 million on tools
$662 million on sporting goods
$645 million on home improvement
$641 million on personal care
$555 million on books and music
$520 million on automotive accessories

Wal-Mart Stores Inc. is celebrating 52 years as a retailer, and while the discount juggernaut’s shares are trading around $77, performance has been lackluster for the past 12 months relative to its previous annual gains. Shares have posted gains of 1.43% in value since the annual meeting in June 2013.

The performance pales in comparison to the Dow Jones Industrial Index in which Wal-Mart is listed. The Dow Jones index has returned a 9.59% gain in the same 52-week period. The broader S&P 500 posted gains of 17.26% in the same 12-month period.

The only other retailer in the Dow Jones Industrial Index is Home Depot, which does line up somewhat with Wal-Mart demographically in the U.S. The home improvement retailer’s share gains are also muted at 1.45% over the past 52 weeks. The shares of other discount retailers like Dollar General have also struggled in the past year. Dollar General shares are up 0.43% over the past 12 months.

None of the retailers, including Bentonville-based Wal-Mart, began calendar 2014 with a bang. Wal-Mart shares have struggled since hitting a high of $81.37 in early December on hopes of a solid holiday. Shares are down nearly 3% since January, after a volatile performance in the back half of 2013.

“The retailer blamed harsh winter weather for keeping consumers indoors during crucial months. Now, with summer sales on the way and back-to-school shopping soon to follow, the Arkansas mega-retailer is looking to reverse its fortunes by taking on its competitors. This includes offering discounts on titles Amazon has stopped carrying, because of its ongoing beef with publisher Hachette, and plans to carry more organic goods to compete with Whole Foods, which has seen its stock struggle in 2014,” notes Jonathan Mariano, senior editor and analyst at The Street.

That said, analysts are split on their opinions about the retail giant’s shares. The 20 brokerage houses that closely follow Wal-Mart for Thomson/ First Call have an average target price of $81 for the shares, with a hold or neutral recommendation. Wal-Mart is trading at nearly 15 times projected consensus earnings for fiscal 2015. 

Shares of Wal-Mart stock (NYSE: WMT) closed Monday (June 2) at $76.76, down 1 cent. During the past 52 weeks the share price has ranged from a high $81.37 to a $71.51 low. Shares were trading slightly higher – gains of around 0.2% – in Tuesday morning trading.

Even with the small price gain in the past year, the share price is higher heading into the 2014 shareholders meeting (June 6) than during the same time in 2013. In fact, during the past 10 years, the share price heading into shareholders week has been lower only once (June 2009) than the previous year.

BULLS VIEW
Raymond James & Associates analyst Budd Bugatch recently reaffirmed his “overweight or buy” position for Wal-Mart Stores after the weaker-than-expected first quarter earnings.

Bugatch did lower his target price to $83 from $85 based on sluggish operational performance. The firm also reduced its fiscal 2015 guidance to $5.25 per share on revenue of $486 billion, citing the challenging headwinds from weather, SNAP income adjustments and higher benefits costs under the new health care law.

Wal-Mart anticipates benefit costs to increase about $100 million per quarter, based on higher enrollment numbers for health insurance during the first quarter of fiscal 2015.

“Given Wal-Mart's continued investment in small format stores, commitment to integrating E- commerce with brick and mortar stores, and attractive valuation, we remain constructive on the shares,” Bugatch noted.

ON-THE-FENCE
Brian Gilmartin, a portfolio manager at Trinity Asset Management and contributor to the Fundamentalis blog site, noted just ahead of Wal-Mart’s recent earnings call that he “expects Wal-Mart and retail in general to trade better into the 2014 summer.” He said the shares are fairly valued at $80.

Gilmartin said there is still the lingering Mexican bribery scandal and declining store traffic which has persisted for five consecutive quarters. He said the retailer has been able to compensate for the lower traffic with better pricing or better average ticket.

“The longer-term issues around Wal-Mart are still present and are not under the company's control,” Gilmartin said. 

Noting that Wal-Mart has created more wealth than even Warren Buffett in the last half of the 20th Century, Gilmartin said Wal-Mart is persistently challenged to grow revenues at something more than “low single-digit” percentages in an environment where GDP grows 2% and inflation hovers at 1% to 1.2% annually.

BEARISH VIEW
The Value Investor notes that Wal-Mart continues to woo investors with its 2.5% dividend yield and aggressive stock repurchase plan, retiring shares at a rate of 1% per year.

However, the bears don’t see the recent investments in small format and e-commerce generating enough new sales in the next couple of years to make up for the stagnation that has persisted for some time in its core business. At best the bears note that the handsome dividend yield makes Wal-Mart more of a hedge play than a growth story.

“It is important for Wal-Mart to lower costs in order to increase margins and profits. Its dividend growth was low in the past year, and I am not expecting major growth this year. But it is a good stock with limited risk for defensive investors.” according to Winning Strategies analysts and contributors to Seeking Alpha.

Belus Capital Advisors CEO and Chief Equities Strategist Brian Sozzi has been vocal about red flags he sees in Wal-Mart’s underlying business.

“Not only does buying interest in Wal-Mart shares look foolish in light of the first quarter figures, but it stands to be completely reversed in coming months based on the numerous fundamental disappointments in the quarter from a company that has grown too big to manage properly,” Sozzi noted to investors on May 15.

He also notes that the past five lackluster quarters for Walmart U.S. have been under CEO Bill Simon’s watch. Sozzi said he is unimpressed with Wal-Mart’s underlying business from “missing easy comps to overusing the severe weather excuse.”

“Right into the weak first quarter earnings and second quarter guidance letdown and continued pressure on return on investment are those tech investments online paying off. ... This management team is full bore on repurchasing stock,” which Sozzi said he sees as another red flag.

Benton County is one of the fastest growing areas in the Natural State in part because of job creation, quality of life and strong public school systems. But a recent study by consumer advocacy site NerdWallet shows that Bella Vista and Centerton in Benton County top the rest of the state as the best places for homeownership.

Only one city in the Fort Smith region, Greenwood, cracked the top 10 list. Other Fort Smith metro cities ranked in the NerdWallet study were Van Buren (16), Mena (18), Alma (26), and Fort Smith (37)

NerdWallet crunched the numbers for all 62 Arkansas communities with more than 5,000 residents to find the best cities for homeownership in the state. Here’s what the best cities had in common:
• Home values were less than $200,000 in all but two places;
• In half the places homeowners spent less than 25% of monthly income on housing; and
• 18 of the 20 cities gained population between 2010 and 2012.

The criteria in this study looked at three main questions: Are homes affordable?; Can you afford to live there?; Is the city growing?

BELLA VISTA APPEAL
Bella Vista ranked No. 1 with an 89.3% home ownership rate, the highest in the study. The cost of home ownership in Bella Vista as a percentage of household income was 23.4%, the lowest in the study. The city population grew 6.7% between 2010 and 2012. Despite the growth, median home prices at $152,300 were 8% less expensive than in neighboring Bentonville, based on the 2010 U.S. Census data 5-year estimates.

Bella Vista is part of the Bentonville School system, also the highest ranking large school in the state according to standardized test scores. The city is diverse, having began as a retirement resort in the 1960s. The homes feature wooded lots, six lakes and seven golf courses, with several parks and indoor as well as outdoor swimming facilities. Bentonville, by the way, was ranked 11th on the list.

Paul Bynum, analyst with MountData.com, reports that there were 874 homes sold in Bella Vista during 2013, unit sales in the city rose 16% from 2012 and total sales volume was $127.498 million, up 19% from the prior year. The city also boasted the shortest days on market across the two-county are at 49 days. In this active market median home prices rose 5% from 2012 to $130,700, which is well below the Census estimates.

Helen Dankser, an agent with Crye-Leike in Bella Vista, said she wrote nine new sales contracts in April. The Bella Vista sales office for Crye-Leike saw a record month in April, with sales up 29% from a year ago. Dansker said buyers of all ages are attracted to Bella Vista because of the amenities, good schools and opportunity for secluded lots – located within a very short distance to the main highway or one of the country clubs or lakes.

Bella Vista has one of the higher median household income levels at $5,118 per month, just a few dollars shy of Bentonville — the highest median income in the two county area at $5,140 per month. Bryant, Maumelle and White Hall each have higher median monthly household income estimates than Bentonville, according to the Census estimates.

CENTERTON BOOM
Centerton, also part of the Bentonville School system, came in second for the best place to own a home in Arkansas. Centerton’s population exploded 13% between 2010 and 2012. 

The median home price was an affordable $140,000 according to the Census projections, which was 15.6% less expensive than neighboring Bentonville. Major street widening of Arkansas 102 has made accessibility to and from Centerton much easier in the past year. 

The study gave Centerton an overall score for homeownership of 73.7, good enough for second place in the state. The home ownership rate is 67.9%, less than Bella Vista, but more than the 57.3% in Bentonville and the 55.9% in Siloam Springs.

Median household income in Centerton is an estimated $4,842 per month. The cost of homeownership in Centerton averages about 25.1% of household income. This was a little higher than the 23.4% average cost in Bella Vista, but cheaper than the 27% average cost estimated in Bentonville.

Centerton is the site for the second Bentonville High School and Wal-Mart is in the midst of building a supercenter and a neighborhood market in Centerton creating about 400 jobs in this small community. Mercy also recently broke ground a new medical clinic in Centerton.

Other Northwest Arkansas cities making the list included Siloam Springs (17), Rogers (19), Lowell (20), Farmington (27), Springdale (40), and Fayetteville (62).

Link here for the ranking of all 62 Arkansas cities compared.

Despite a fiscal year-to-date decline in individual income tax collections, Arkansas’ largest source of tax revenue, gross tax revenue for the fiscal year is up 0.6% and the state is on track to be able to fully fund the budget. However, May gross revenue fell 4% compared to May 2013.

Year-to-date gross revenue (July 2013-May 2014) totaled $5.626 billion, just 0.6% above the same period last year and above forecast by 0.3%, according to the report issued Tuesday (April 4) by the Arkansas Department of Finance and Administration.

Collections have declined relative to how the fiscal year began. The gross collections were up 3.4% after the first six months of the fiscal year, and 0.9% above forecast. After the first four months of the fiscal year, the gross revenue was up 4.1%.

Individual income tax collections for the fiscal year totaled $2.824 billion, down 1.2% from last year and just 0.4% above the budget forecast. Year-to-date sales and use tax collections were $1.993 billion, up 2.7% above last year but 1.2% below the budget forecast. The sales and use tax collections were up 4.8% four months into the fiscal year and up 3.9% six months into the fiscal year. Income taxes and the sales and use tax collections are the two primary sources of state revenue.

Corporate income tax collections for the first 11 reporting months of the fiscal year totaled $374.2 million, up 4.1% compared to last year and 5% above forecast.

MAY NUMBERS
May gross revenue was $425.3 million, down 4% from last year and 6.2% below forecast.

John Shelnutt, head of the Department of Finance and Administration’s Economic (DFA) Analysis & Tax Research division, said a shift in corporate income tax collections altered the May results, but said the revenue is expected to meet state budget needs.

“Results in May reflect a shift of approximately $20 million in Corporate Income tax collections previously reported in April but normally expected in filings for May. This one-month shift boosted April results at the expense of May while year-to-date results now reflect a more realistic look at performance with one month remaining in the fiscal year. The budget is on track to be fully funded,” Shelnutt noted in his report.

Individual income tax collections during May totaled $203.6 million, up 1.2% compared to May 2013 and below forecast by 1.7%.

Sales and use tax collections during the month totaled $180.7 million, down 1.8% from last year and 5.2% below the forecast. Sales and use tax collections, considered a barometer of consumer confidence, ended fiscal year 2013 on a down note. Collections in the segment for the fiscal year totaled $2.124 billion, up just 1.1% compared to the 2012 period, and 1.4% below forecast.

OTHER TAX COLLECTIONS
Alcoholic beverage
May 2013 - May 2014: $47.1 million
May 2012 - May 2013: $46.6 million

Games of skill
May 2013 - May 2014: $35.9 million
May 2012 - May 2012: $32.6 million

Tobacco
May 2013 - May 2014: $201.2 million
May 2012 - May 2013: $209.5 million

Insurance
May 2013 - May 2014: $68.6 million
May 2012 - May 2013: $65.1 million

COLLECTIONS HISTORY
Tax collections during fiscal year 2013 (May 2012-May 2013) totaled $6.214 billion, up 4.9% above the previous fiscal year and up 2.5% compared to budget estimates. One result of the gains was a budget surplus of $299.5 million.

Fiscal year 2013 marked the third consecutive year of year-over-year gains. Arkansas tax collections reversed a negative two-year slide in the 2011 fiscal year, with collections up 4.5% in the May 2010-May 2011 period.

State tax collections for fiscal year 2011 totaled $5.673 billion, up 4.5% above the $5.43 billion in the 2010 period.

The biggest declines in the 2009 and 2010 fiscal years were with individual income tax collections and sales and use tax collections.

This bidding for breakfast sausage could get expensive. What began as a $6.5 billion bid by Pilgrim’s Pride for Hillshire Brands, has now seen Pilgrim’s up its bid to $7.7 billion to counter a $6.8 billion counter offer by Springdale-based Tyson Foods.

Tyson Foods’ officials would not comment Tuesday about a next move, but the company, in a better financial position than Pilgrim’s, can afford to push the bidding higher.

In an era of higher competition in the low-margin commodity chicken business it’s no wonder Pilgrim’s Pride and Tyson Foods are each actively pursuing Hillshire Brands. Pilgrim’s upped the ante introducing a higher bid of $7.7 billion on Tuesday (June 3) in a deal that would pay Hillshire shareholders $55 per share, a $5 premium over Tyson Foods $50 cash bid offering on May 29.

Pilgrim's revised proposal is not subject to any financing conditions or contingencies, according to the company release. 

“Pilgrim's is confident the transaction is strategically and financially compelling, and creates considerable value for the shareholders of both Pilgrim's and Hillshire. Pilgrim's anticipates run-rate cost synergies in excess of $300 million annually to come from operational and value-chain efficiencies and, in addition, significant growth opportunities in higher margin branded products, both in North America and internationally,” Pilgrim’s CEO Bill Lovette noted in the release. 

He said Pilgrim's expects the increased cash flow from the combined company and the realization of synergies will allow it to rapidly pay down the initial acquisition debt. 

The winners to date have been Hillshire investors as the stock price has rallied another 9% on Tuesday (June 3) to $58.45, up $4.88 on Pilgrim’s counter offer. Shares of Hillshire Brands are up 65% in the past month from the acquisition offers by Pilgrim’s and Tyson Foods.

The offers were unsolicited by Hillshire Brands who had already planned to acquire Pinnacle Foods, a $4.3 billion deal announced May 12. Pilgrim’s and Tyson have both said their offers do not include Pinnacle Foods. 

Tyson hinted during its calls with media and analysts last week that it is financially able to raise the stakes of the offer if necessary. Wall Street is waiting to see if Tyson management will counter the $55 per share bid laid down by Pilgrim’s today.

Hillshire’s Board of Directors said Tuesday it will enter into formal talks with Pilgrim’s Pride and Tyson Foods.

“Hillshire Brands is party to a merger agreement with Pinnacle Foods pursuant to which Hillshire Brands agreed to acquire Pinnacle Foods for per share consideration of $18 in cash and 0.5 shares of Hillshire Brands common stock,” the company said in a statement.

Hillshire also noted that its Board of Directors is not withdrawing, modifying, withholding or qualifying its recommendation with respect to the Pinnacle merger agreement and the merger, or proposing to do so, and is not making any recommendation with respect to either the Pilgrim’s Pride or Tyson Foods proposals.

“Hillshire Brands does not have the right to terminate the Pinnacle Foods merger agreement on the basis of either of these proposals or enter into an alternative acquisition agreement with either of these parties prior to termination. There can be no assurance that any transaction will result from these proposals,” the company noted.

Officials with Pilgrim’s Pride and Tyson Foods said they would pay the $163 million termination fee payable to Pinnacle Foods if one of their offers is accepted.

Alexia Howard, senior research analyst at Sanford Bernstein, said last week the deal make sense for Tyson because its gives them more brands at the end of the of supply chain. Those “value added” products deliver higher margins than food service and commodity meat sales at Tyson Foods.

“It could be a deal of lifetime for Tyson,” she said.

She said the Tyson offer at 13.4 times earnings was the priciest merger and acquisition offer seen this year in the food sector. That was before Pilgrim’s counter offer on Tuesday.

Howard said the fit with Tyson is solid given its diversified protein businesses. It’s not as good of a fit with Pilgrim’s who does not have a domestic pork business. 

TheStreet's Jim Cramer said he does not recommend Hillshire Brands to sell because he thinks the stock could move higher in the bidding war between Tyson and Pilgrim’s who want to move into higher margin offerings. 

Tyson shares (NYSE: TSN) were trading down more than 3% on the news of the higher Pilgrim’s bid. Tyson shares were trading at $42.07 in the heavy volume in the afternoon session (June 3). Pilgrim’s shares (NASDAQ: PPC) also lost ground trading around $25.34 down more than 2% in the afternoon session.

Wal-Mart is often in the center of a battle between the Wal-Mart insiders and any number of outside groups seeking change from and within the insiders, and shareholder week usually involves public displays of dissatisfaction from hourly workers and labor unions. This year is no different. 

Institutional Shareholder Services, an advisor to big shareholders such as mutual funds, recently issued a scathing report on Wal-Mart’s corporate board of directors, namely chairman Rob Walton, son of founders Helen and Sam Walton. The report also took to task former Wal-Mart Stores CEO Mike Duke.

ISS in a shareholder proposal opposes Walton and Duke’s re-election and criticizes the board for doing little to rectify possible violations of foreign bribery probes. They also believe the directors have failed to address the issue of fair executive pay.

Because Wal-Mart’s U.S. sales have dropped for five consecutive quarters and future guidance is also muted with profit struggles internationally, ISS recommended that shareholders vote “No” on the proposed executive pay plan and consider appointing an independent chairman during the company’s annual shareholder meeting on June 6. 

WAL-MART RESPONSE
Wal-Mart defended its position on executive pay, board selection and efforts to confront the Foreign Corrupt Practices Act violations in a recent filing with the Securities and Exchange Commission. Randy Hargrove, Wal-Mart spokesman, said there was a strong correlation between executive pay and company performance, and that named executive officers were interested in aligning with the interests of shareholders. 

He also said Wal-Mart had spent more than $400 million in cooperating with government prosecutors to look into whether overseas executives had violated the Foreign Corrupt Practices Act, which prevented American companies from offering money or services as a bribe to foreign government authorities.

“We believe that ISS’s analysis misconstrues the nature and operation of Walmart’s executive compensation program,” Wal-Mart noted in the filing.

The retailer said there are a number of misrepresentations about its executive compensation plan which was the basis of the ISS recommendation.

“We believe ISS’s recommendations are incorrect and inconsistent with prior years’ analyses. The primary difference this year appears to be the submission of a letter, dated May 19, from CtW Investment Group which contains a number of misrepresentations and intentionally misconstrues our executive compensation program. CtW is a union-affiliated group that has a long and consistent track record of opposing Walmart, with its sole motive being to undermine the company in an attempt to organize Walmart’s associates,” Wal-Mart noted in the filing.  

Wal-Mart points to ISS’s own quantitative analysis which shows Wal-Mart’s executive pay is of “low concern” with pay aligned with performance and low relative to the median of its peers. The retailer noted that performance-based pay in 2014 reflects lower than expected sales and is fitting with company’s protocol to tie company performance to bonus pay.

In fiscal 2014 Wal-Mart notes its named executive officer earned less in bonuses than in the prior because the company failed to meet financial expectations. Following are top Wal-Mart execs and their 2014 reduction in bonuses, according to Wal-Mart:
• Mike Duke: $1.5 million less,
• Doug McMillon: $520,000 less, 
• Bill Simon: $658,000 less, 
• Charles Holley: $418,000 less,
• Neil Ashe: $226,000 less, and
• Rosalind Brewer: $182,000 less.

FCPA MATTERS 
ISS asked shareholders to oust Walton and Duke from their board seats because they do not feel the company has given enough disclosure into the ongoing FCPA probe.

Wal-Mart said its audit committee and the company are following the appropriate protocol for an independent, thorough investigation. Wal-Mart said it voluntarily disclosed the audit committee’s investigations to the U.S. Department of Justice and the U.S. Securities and Exchange Commission, both of which are conducting their own external investigations.

The retailer said the release of “specific findings” related to the ongoing investigations would be contrary to the company’s best interest as well as its shareholders. Wal-Mart also notes that Walton and Duke have been instrumental in the new compliance programs in all countries where Wal-Mart does business which have resulted from the investigation.

DISGRUNTLED MOMS
Another group taking aim at Walton this week are a faction dubbed real-life “Walmart Moms” who began striking this week in 20 cities with a demonstration in Phoenix held Tuesday (June 3).

“I came to Phoenix to tell Rob Walton what it’s like being a working mom at Walmart. While his family is the richest in the world, my son and I depend on family and public assistance to keep our heads above water. ... Women at Walmart need the company to end the retaliation and pay us a minimum of $25,000 a year for full-time work so we can support our families,” Bene’t Homes, a 25-year-old Walmart worker and OUR Walmart member from Chicago, said in the group’s press release.

Wal-Mart has said these groups are backed by union efforts. The retailer continues to emphasize that it promotes more than 180,000 employees each year and three out of four managers within the company started as an hourly worker, including Wal-Mart Stores CEO Doug McMillon.

McMillon, who presides over his first shareholder meeting as the Wal-Mart CEO, recently said Wal-Mart has no problem promoting cashiers into better paying jobs. The problem Wal-Mart faces is when it hires a cashier who remains in that position, for whatever reason, for 15 years. He said store managers make on average $150,000 or more and the majority began their career as an hourly worker. 

Sherry Curtis-Swenson, manager of the Wal-Mart Supercenter in Jane, Mo., told The City Wire last summer that she began her Walmart career as cashier 20 years ago. She oversees 450 employees in a store that is open 24-hours a day. She began as store manager 10 years ago when the supercenter opened. Prior to that she worked in the Bentonville supercenter, the store her husband now manages.

“I can’t imagine doing anything else. I love working with people. Just recently I was able to promote a stocker into an assistant manager position and know firsthand how this will change his life,” Curtis-Swenson said.

Tulsa-based Syntroleum will cease trading shares on Friday (June 6) as the company’s stakeholders approved the sale of its assets to Iowa-based Renewable Energy Group in a deal worth an estimated $34.83 million. 

Syntroleum received 3,493,613 shares of REG common stock in the deal. Renewable Energy shares closed Tuesday at $9.97, up 1.42% on the day. Syntroleum also filed its intent to delist from the NASDAQ Capital Market effective June 6.

Syntroleum CEO Edward Roth accepted employment with REG and Susan Power, chief financial officer, will be responsible for winding down the operations of Syntroleum.

“We are very pleased to bring new advanced biofuel technologies into the REG portfolio of products that will expand our biomass-based diesel business and launch us into new customer segments,” Daniel Oh, president and CEO of Renewable Energy Group, said in a statement. “We welcome the newest members of our team in Tulsa to REG Synthetic Fuels.”

The approval of Syntroleum’s asset sale clears the way for Tyson Foods to unload its 50% interest in Dynamic Fuels, a $65 million deal that was announced May 21. Syntroleum and Tyson joined forces in 2007 to build a renewable fuels plant in Geismar, La., that turns low grade chicken fat into renewable diesel. The $150 million plant was completed in 2010 and has failed to live up to its potential 175 million gallons of production.

The plant has sat idle since November 2012, with each partner spending $1 million per month to keep it in standby mode.

“Selling our interest in Dynamic Fuels to REG provides capital for Tyson to redeploy into other opportunities,” said Andrew Rojeski, vice president-Renewable Energy for Tyson Foods. “REG is a long-term customer of ours, buying fats, oils and greases to make renewable fuel, and we hope to continue that relationship.”

If the deal is completed between Tyson and REG the payout would come in three ways and would include a release of Tyson’s liability on the outstanding debt used to build the plant. Tyson would receive $18 million in cash at closing with $35 million in future payments which are tied to production over 11.5 years. Tyson also wants to collect $12 million at closing for outstanding loans made to Dynamic Fuels.

Sam’s Club, in the midst of trying to generate more traffic and raise sagging sales, announced Tuesday (June 3) a new cash back credit card program with its co-branded MasterCard, issued by GE Capital Retail Bank. The new card will also contain chip-enabled technology for more security in the wake of Target’s data breach during the 2013 holiday season.


Starting June 23, the Sam’s Club 5-3-1 cash back program will provide qualifying members the opportunity to earn 5% cash back on fuel, 3% cash back on dining and travel and 1% cash back on all other purchases up to $5,000 annually, the company noted in its release.

“We’re always looking for ways to find time and money-saving solutions for our members. The 5-3-1 Sam’s Club program and co-branded MasterCard mean industry-leading savings and security innovation for today’s consumer,” said Rosalind Brewer, president and CEO of Sam’s Club ... Club members can earn up to $5,000 cash back annually. That could cover a family of four’s travel to Disney, or five sets of laptops and wireless phones for a small business. We believe this value is the best in the industry.”

Each credit card has an embedded chip that makes the card more difficult to duplicate, which provides enhanced security from fraudulent activity.
 
“MasterCard has taken a strong stance on the need for the U.S. market to make the transition to chip-enabled credit cards for the benefit of cardholders and merchants alike,” said Chris McWilton, president North America, MasterCard. “This move by Sam’s Club makes them a trailblazer in getting chip cards in the hands of businesses and consumers, and leading the push toward a safer and more secure customer experience. This will no doubt help drive chip-enabled technology forward here in the U.S. as it gains more traction.”

For additional details on the Sam’s Club credit card cash back program, visit SamsClub.com/newsroom.

Sales tax revenues for the city of Fort Smith were up in April, with the revenue gap narrowing in the city for the first four months of the year.

The city's sales taxes (1% for streets and 0.75% for water and sewer projects) collected $2.979 million in the April report, up 3.38% from the same period in 2013.

The total in the April report represents an increase of 0.92% over budget. (Because the state of Arkansas has a two-month delay in reporting collections back to the cities, the city of Fort Smith — for budgeting purposes — has historically reflected the collections on a one-month delay. Which is to say, the tax collections remitted to cities in April are from taxes collected in February and transferred by merchants to the state in March.)

Collections so far in the 2014 reporting period of the two taxes were $11.688 million, while the same period in 2013 saw collections of $11.702 million. The same period in 2012 saw $13.586 million and $12.932 million in 2011.

Total collections in the year 2013 of the two taxes plus the 0.25% fire and parks sales tax were $38.937 million. Collections in 2012 of the two 1% taxes totaled $39.21 million, slightly ahead of the $38.683 million during 2011. The 2011 collections were 3.9% above 2010 collections.

Fort Smith's share of the countywide 1% sales tax in the April report was $1.294 million, up 3.5% from last year's total during the same period of $1.277 million. The collection was up 3.02%, or $38,708, compared to a revenue estimate of $1.283 million for the month.

The countywide tax generated $15.353 million for Fort Smith during 2013, up 0.49% compared to 2012 and down 1.99% compared to budget forecasts. The countywide tax generated $15.279 million in 2012, just ahead of the $15.15 million in 2011, but lower than the peak collection of $16.61 million in 2008.

The countywide tax collection is critical because the revenue is a little more than 40% of the city’s general budget of roughly $42 million. A majority of the general fund budget supports fire, police and other critical city functions. The dip in collections compared to budget estimates has resulted in city officials seeking 4% budget cuts from all departments.

The prospect of any budget cuts similar to what happened last year seems to have dimmed with the April report, with revenues appearing to have stabilized. Finance Director Kara Bushkuhl said the report "has a positive trend and is helping to close the gap on the annual revenues."

Bushkuhl said last month that a reduction would be unnecessary, though she said the fire and parks department budgets may need to be adjusted slightly if trends continued, though the April figures appear to show a reversal in trends, at least in the short term.

PREVIOUS ANNUAL COLLECTION INFO
Fort Smith 2% sales tax collection (1% for streets; 1% for water/sewer bonds)
2013: $38.937 million
2012: $39.210 million
2011: $38.683 million
2010: $37.229 million
2009: $37.554 million
2008: $41.226 million
2007: $37.858 million
2006: $36.840 million

Fort Smith portion of 1% countywide sales tax
2013: $15.353 million
2012: $15.279 million
2011: $15.15 million
2010: $14.89 million
2009: $15.04 million
2008: $16.61 million
2007: $15.15 million
2006: $14.71 million

Wal-Mart Stores has made no secret of its need to innovate. By some outside estimates the retailer has spent around $2 billion on 10 tech startups since 2011. But the retailer rarely allows the media inside its expansive innovation lab in Bentonville where about 3,500 employees work to transform the shopping experience.

The media got a rare peak at some of the innovation consumers can expect to see in the coming months to years. Items revealed included 3-D digital printers in stores that allow shoppers to replicate their own images for wedding cake toppers and digital watermarks in print circulars that allow shoppers to scan the item on the page into their phone to glean a host of additional product information including reviews.

Wal-Mart’s chief technology officer Suju Chandrasekaran said the innovation lab and its collaboration with a Wal-Mart employees in San Bruno, Calif., Bangladore, India, and Sao Paulo, Brazil, have become a formidable technology company within the world’s largest retailer. She said the amount of data Wal-Mart collects and analyzes daily is so large that the company created a “Data Cafe” which merges point-of-sale data with social media feeds and syndicated market share data.

This real-time data is used to impact store staffing, on-shelf availability, merchandising and a host of other applications.

Cory Gundberg, vice president of strategic planning at Walmart Technology, said the retailer is looking at wearable technology and, with its suppliers, hopes to find that item that will become as common as the cell phone.

The retailers’s innovation lab has held eight hackathons in the past two years which has yielded scalable ideas such as “Amazing on a Budget” – a shopping tool that allows a shopper to get help stretching a food budget. The innovation came from a real-life situation when a shopper in Chicago asked the store manager to help feed her family of four on a limited budget. She gave the manager the budget and the store gave her list of items.

“Amazing on a Budget” does the same thing in a seamless manner while also allowing the shopper to stay within a budget. It can refer a private label or access a manufacturer coupon if available to help the shopper access savings.

Gibu Thomas, senior vice president of mobile and global e-commerce for Wal-Mart, said  Wal-Mart is using technology to get closer to the customer.

“We know 65% of our shoppers have smartphones, 80% of Millennial shoppers. This an incredible opportunity for help improve the shopping experience giving them more tools,” Thomas said.

He talked about e-receipts, which are created by scanning the QSR code on the bottom of the receipt or typing in a phone number into the terminal when cashing out. While e-receipts are not a new innovation, he said it is pa latform that can be expanded. Thomas said the e-receipts can be stored in e-mail locker and then used to create predictive shopping lists which may be accessed as the shopper enters the store. He said Scan & Go, which is now being tested in about 300 stores is more appreciated for its budgeting capabilities than the time savings, which is why it was originally created.

“We are testing lots of things, learning fast and willing to fail fast which is part of the startup mindset.” Thomas said.

Three months after Wal-Mart first announced the testing of a new savings tool to help drive more in-store traffic, the retailer said it’s expanding the guidelines and rolling out its Savings Catcher program nationwide later this summer.

The receipt comparison tool looks at competitors ads and gives customers an e-gift card for the difference when a competitor’s price is lower than what a Wal-Mart customer paid. Duncan Mac Naughton, chief merchandising officer at Walmart U.S., said Wednesday (June 4) that Savings Catcher automatically compares 80,000 grocery items, but in the coming months produce and general merchandise are to be added to the mix.

The program does not compare private label prices and there is no plan to include them, Wal-Mart said Wednesday.

“Our customers are savvier than ever when it comes to finding the best deals — they are using technology to do their research and spending hours clipping coupons. We knew there had to be an easier way,” Mac Naughton said. “Wal-Mart Savings Catcher offers customers yet another reason to trust us when it comes to help them save money. It brings greater price transparency to the market and gives our customers confidence that they are finding some of the best deals available in retail.”

Wal-Mart said the program has only been available on Walmart.com, but it will be accessible on Walmart’s mobile app.

Since March, in limited test cities, Mac Naughton said nearly one million receipts have been processed using Savings Catcher, making it the top rated concept tested to date by the retailer.

Gibu Thomas, senior vice president of Walmart mobile and global e-commerce, said Savings Catcher will also work in tandem with e-receipts that will allow the automatic uploading of receipts into Savings Catcher. With this data, predictive shopping lists will also be a possibility as the retailer continues to find ways to interact with its customers via technology. 

CUSTOMER IS KING
Wal-Mart spends a lot resources studying its customers and it gathers survey data from roughly 500,000 customers each month, according to Cindy Davis, director of global customer insights at Wal-Mart.

Davis said billions of data is constantly collected from point of sale, to syndicated market data and social listening platforms. The retailer collects 250 million social posts a month, which it uses to gain insights into shopping patterns and consumer mindsets.

“This data collection and analysis helps us to understand customers faster and be able to react better to their wants and needs. We conduct online focus groups through internet chats rooms with a moderator which gives us access to authentic shopper voices, which are shared across the company,” Davis said.

MILLENNIAL FOCUS
One group the retailer is focusing on are the Millennials, because of their future buying power — an estimated $5.3 trillion over the next four years. Wal-Mart's research indicates Millennial moms are planners, more so than their mothers. Savvy Millennials shop from a list with a detailed budget and price is a huge factor in their decision to buy, according to Davis.

This generation – typically born between 1982 and 2004 – is looking for more choices of healthier and fresh foods at an affordable price. 

Jane Ewing, senior vice president of baby at Walmart U.S., said Millennials are informed shoppers, doing a lot of research online and talking with friends and families before buying larger items.

She said one of the criticisms Wal-Mart heard a while back from this generation was a lack of assortment of organic baby food, something the retailer is addressing with more products now in the pipeline.

A February 2010 report from Pew Research said this of Millennials: “They are more ethnically and racially diverse than older adults. They’re less religious, less likely to have served in the military, and are on track to become the most educated generation in American history.”

THRIVE Bentonville is a 44,000 square foot mixed-use experience with 62 residences and two culinary activators. ERC, the project developer announced Thursday (June 5) that Crepes Paulette, known for their gourmet crepes, will join THRIVE.

The development in downtown Bentonville is designed to create urban living opportunities which is being made possible in part by the large scale multifamily project — THRIVE — located in the city’s Arts district.

They will serve lunch with an expanded French-inspired menu and are also looking to expand their hours to serve breakfast and evening meals in the future. Along with their location at THRIVE Bentonville, they will continue to operate from their food truck located at Northeast A Street, with a smaller menu. Fred and Paula Henry opened the food truck in 2010 bringing French crepes to downtown.

The THRIVE Bentonville experience seeks to immerse dwellers in an urban environment with access to specialized concierge services and special events, as well as being located within walking distance to parks, dining, shops, and entertainment.
 
ERC said another new culinary concept is in the works by some of the region’s top culinary stars and those details will be shared in the next few weeks. The concept, which is yet to be named, seeks to connect another unique culinary experience to downtown.

The goals of the team are delivering both an oasis for THRIVE clients and a premiere entertainment, meeting and social experience for the city of Bentonville, ERC noted in the release.

As the dream of a regional trail system is rapidly becoming a reality, Northwest Arkansas businesses are reaping the benefits from the Razorback Regional Greenway.

The Greenway should be “substantially complete” by the end of 2014, said John McLarty, transportation study director at the Northwest Arkansas Regional Planning Commission. That means the ribbons of concrete will be connected with only minor improvements and landscaping remaining to complete, weather permitting.

Full build-out of the Northwest Arkansas Razorback Regional Greenway is expected to cost approximately $38 million with majority of necessary funds already pledged from two different grant sources: a federal transportation grant and a matching grant and gift from the Walton Family Foundation, according to the NWA Trails website.

The trail is already complete from Walker Park in Fayetteville to Lake Fayetteville and from the northern end of Lake Bella Vista to Garrett Avenue in Rogers. Work began recently in Lowell and Springdale, which will complete the trail system.

“We are seeing tremendous use, lots of traffic and lots of good comments,” McLarty said. “It’s really filling a need in the community.”

And local businesses are thrilled to help the community fill that need.

Several local bike and outdoor stores are reporting a noticeable increase in sales due to people wanting to get active on the Greenway. Phat Tire Bike Shop, which has locations in Bentonville and Fayetteville, is seeing a “definite increase in bike sales, both in cruisers and hybrids,” said manager Haley McCurry from the Bentonville location.

Hybrids alone have seen a 10% increase since the Greenway opened, McCurry said.

“In the bike industry, that’s a lot,” she added.

The Greenway opening has changed how they do business, McCurry said.

“We are seeing more first-time riders and families,” she said. “They just want to get out there and start riding as a family. We think that’s awesome more people want to get exercise and get involved.”

Another change is that people are purchasing more bike accessories that lend themselves to commuting such as racks and baskets for people to carry groceries and other items to their destination.

Rob Potts, co-owner of Lewis & Clark Outfitters, which has locations in Rogers, Springdale and Fayetteville, said his company is also seeing a rise in business. Potts declined to give a specific growth percentage, but “it has been great for business and we have seen a huge increase in the number of people that are interested in getting into cycling.”

The company offers bike sales and repair, as well as other outdoor enthusiast gear. The increase in demand required them to increase their maintenance staff to increase their ability to do timely bicycle repairs.

“People who had never thought about riding before the trails were built are now seeing the benefits in cycling and having an overall healthier lifestyle and are coming into the stores,” Potts said. “We are seeing a combination of people riding for recreation and for commuting, though the majority are recreational riders.

“(The Greenway) is definitely the most impactful thing that has happened to cycling here in NWA.”

Potts added that when all the cities are connected, he expects to see a considerable increase in the number of people interested in using the trails for commuting and pleasure. He also sees the Greenway as a popular tourist attraction.

“A lot of people are going to be traveling here to ride that trail,” he said.

While the Greenway is promoting more bicycling and running in Northwest Arkansas, it’s also a national trend. According to the U.S. Census Bureau, commuting to work by bicycle has increase by 60% over the last decade. According to Bicycle Retailer and Industry News, which is an online trade publication, the sales of new people-powered two-wheelers were more than $3.66 billion in the United States in 2012 (most recent available figures).

Not all of the businesses seeing better sales because of the Greenway are related to outdoor sports. Apple Blossom Brewing Company in Fayetteville normally sees traffic from bikes, but it’s increased with the opening of the trail and the better weather, co-owner Ching Mong said.

“They end up here a lot as a destination spot,” he said. “It’s noticeably different from winter. Foot traffic and bike traffic probably account for up to 25% to 30% of our business.”

Bike Bentonville is a nonprofit organization dedicated to growing community involvement in healthy outdoor activities. Kyla Templeton coordinates the Safe Routes to School Program and the women’s cycling program. She said the new trails are especially good for the Safe Routes program and that volunteer parent-led bike chains travel from Bella Vista to arrive at R.E. Baker Elementary School and Old High Middle School.

She also leads women cycling groups. While most prefer to use the roads, the trail system allows for a multi-generational experience, Templeton said.

“It’s a way of getting out and enjoying the outdoors and each other without being scared of being on the road,” she said.

Once the Greenway is complete, Templeton anticipates hosting an annual ride to Fayetteville and back.

The former Nordex USA wind turbine factory in Jonesboro has been sold to a subsidiary of Trinity Industries, a Dallas-based firm that will re-open the closed plant as a railcar manufacturer creating up to 350 jobs.

The company’s subsidiary, TrinityRail Maintenance Services Inc., will provide railcar maintenance and services in the operation.

“We welcome TrinityRail Maintenance Services to Jonesboro, and we are excited for the significant investment the company is making in Northeast Arkansas,” Gov. Mike Beebe said. “This shows again that when Arkansas cities have the right workforce and facilities, new companies will continue to bring good-paying jobs here.”

“Jonesboro’s reputation as a manufacturing hub continues to grow with TrinityRail Maintenance Service’s decision to locate its new facility here,” said Jonesboro Mayor Harold Perrin. “We appreciate the company’s confidence in our workforce and look forward to TrinityRail’s success in Jonesboro.”

“The decision of TrinityRail Maintenance Services to locate in Jonesboro is anticipated to create hundreds of new jobs and will have a substantial impact on the area’s economy for years to come,” Mark Young, president and CEO of the Jonesboro Regional Chamber of Commerce, said in a statement. “Thanks to TrinityRail Maintenance Services for making the decision to invest in Jonesboro, Craighead County and our citizens.”

Count pent-up demand for Trinity’s expansion in Jonesboro. In its annual earnings release, Trinity noted that it had received orders for 7,125 new railcars during its fourth quarter and that it had a backlog of 39,895 units worth nearly $5 billion in sales.

Trinity is a publicly-traded, diversified conglomerate that manufactures railcars, including tank cars, hoppers, and gondolas to transport chemicals, coal, and other materials. It also makes construction products, barges, energy equipment, and offers railcar fleet management services.

Trinity posted net income of $226.4 million on revenue of $1.5 billion in the first quarter of 2014. For the full year in 2013, Trinity showed profits of $375.5 million on revenue of $4.4 billion.

The company’s location in Northeast Arkansas positions the region as a major manufacturing hub for railcars. American Railcar Industries, headquartered in St. Charles, Missouri, has railcar manufacturing facilities in Paragould and Marmaduke.

NORDEX CLOSURE
The Jonesboro deal helps close the door on Nordex’s short presence in Arkansas. Nordex came to the state in 2009 amid great fanfare to make “nacelles” used for large wind turbines. Nacelles house the engine and other key turbine components and sit high atop a wind turbine tower.

The $40 million production facility once promised to employ 750 workers, but “uncertainty and instability” in the U.S. wind energy market were cited by company leaders as reasons to close the factory in July 2013.

State officials say Nordex has repaid all of the nearly $2.5 million it owed in clawback provisions to Arkansas for incentives it earned as part of its deal.

According to city leaders, Nordex will also pay off the debt owed on local loans and bonds that were issued for the $40 million facility as part of its investment in Jonesboro.

Bill Simon, CEO of Walmart U.S., said the retailer is excited about the interest from about 500 U.S. companies who want to sell American-made products in its stores. Many of those companies have secured a date to meet with Wal-Mart at its July 8, open call, Simon said.

“I am excited about the possibilities for these U.S. manufacturing jobs and to see what new U.S.-made products will be presented at these meetings. In these meetings we will look at possibilities of supplying Wal-Mart, Sam’s Club and or Walmart.com, whatever fits the best,” Simon said.

He said the retailer has 180 active projects with manufacturers in the pipeline toward moving operations onshore.

‘This is not a Wal-mart initiative. It is a macro-economic fact that is evolving from trends in the marketplace today. … These U.S. made goods do not cost more. If you drive past our home office you will see these silly pink flamingos out front. Last year we sold a ton of those that were made in China, there are two pink flamingos out there this year that we made in the U.S. that cost less and allow for more flexibility inventory ordering on demand,” Simon said during the question and answer session with executives on Thursday (June 5) at the Embassy Suites in Rogers for the Wal-Mart shareholders week.

LESSONS LEARNED
He said the multiple formats are essential in Wal-Mart’s ability to meet consumer’s diverse shopping needs. Simon added that the learnings from the Walmart to Go convenience store format in the past 90 days have been huge. On area is in the fountain beverages from milkshakes to coffee and soda.

“We took these fountains out of our supercenters and we are not evaluating the feasibility of bring them back,” Simon said.

He added that the Bentonville store has some expensive features like the covered awning from the gas pumps to the front door, which may or may not be duplicated in future iterations of this concept store.

Simon told the group that the hybrid neighborhood market store is also a convenience play and comparable sales are on par with other top grocery retailers like Kroger.

“The past quarter marked the 46th consecutive positive same-store sales reading, with sales growing incrementally in every year since they were introduced in 1999 till now. These are hybrid stores that are performing very well,” Simon said.

Simon will need more of the stores in the Walmart U.S. universe to perform well. The company’s first quarter earnings were ugly. The retailer reported per share net income for the first fiscal quarter of $1.11, below the consensus estimate of $1.15. The company earned $1.10 per share from continuing operations. Total revenue of $114.96 billion was up slightly over the $114.07 billion in first quarter of 2013 and was below the consensus estimate of $116.27 billion.

Company officials said the first quarter was hit hard by unusual winter weather in the U.S. during January.

Comp traffic for Walmart U.S. was down 1.4% in the quarter, despite a 1.3% uptick in the average shopper ticket. This marks the fifth consecutive quarter of negative to flat comparable sales, the benchmark metric used to measure retail performance.

And the second quarter may not be a big improvement. The company is predicting earnings per share in the range of $1.15 and $1.25. The company hit $1.24 per share in the second quarter of the previous fiscal year.

HEALTH CARE TEST
Another area Wal-Mart is testing is company-owned health care clinics to be located in up to 12 supercenters this year, according to Simon. The first clinic opened last month in Coppers Cove, Texas, providing primary care access to Wal-Mart employees and customers.

“Associates on the Wal-Mart health plan have a $4 co-pay and customers pay a flat $40,” Simon said.

Wal-Mart is contracting with QuadMed staffing company who will provide two licensed nurse practitioners for the clinic. As a self insured company, Simon said getting its own employees to use the service is key to its success and the response in the one pilot test is strong.

The retailer has about 180 health clinics in stores, which are operated by local health care professionals or hospitals on a lease arrangement, and this is retailer’s first company-owned clinic.

“Our Walmart Care Clinic pilot is creating a new price position for retail health services that aims to give our associates and customers greater access to quality, affordable health care that will improve their lives,” said Labeed Diab, president of Health and Wellness for Wal-Mart.

Following are some stats pushed out during several Thursday meetings with the media.
• $3.2 million: The savings money transfer fees since April.
• 115,000: The number of games exchanged for cash since March.
• 7 million: The number of online items at walmart.com.
• 1,000 new hires: The number of technology jobs added @WalmartLabs this year.

The 21st Annual Jack White Legislative Golf Tournament to be held Monday, June 16, will involve more than golfers trying to prove their skills on the course – it will involve a robot trying to do the same.

That's right. An IRB 120 robot, the brainchild of a robotics team at ABB, parent company of Fort Smith-based Baldor Electric, will be on hand at the golf tournament.

And while the robot will wow and dazzle the crowd, Baldor Marketing Vice President Tracy Long said the purpose of having the robot on hand June 16 is to highlight the partnership between Baldor and the University of Arkansas at Fort Smith, which announced the creation of a new robotics certification in February.

"With the help of ABB and Baldor, they are installing a whole new series of ABB robots in the McFarland Lab over in the technology building. So UAFS has really kind of moved into this next stage and understanding that there's a lot of manufacturers in town like Baldor who are using robotics now in production to improve safety and to improve productivity and to really add value to the job that we have in manufacturing plants,” Long said in a note. “And so it's a really, really cool thing that UAFS is doing and ABB and Baldor are both so excited to be part of that. So to help them celebrate and kind of share that news, ABB is loaning us this robot they've created to take out to the Chamber (of Commerce) golf tournament.”

Fred Carillo of ABB Robotics said the robot uses a few different technologies to sink the perfect put that alludes so many and further demonstrates the types of projects UAFS students can work on if they choose to pursue the robotics certificate.

First, he said the device uses "range finder technology" to locate the hole and then uses "vision technology" to locate the ball and club before eventually picking up the putter and sinking the ball in the hole.

"Based on some other things that go on that we've developed, we're utilizing some technology that is commonly used on different kinds of applications and manufacturing. And you're seeing it deployed in a rather fun way and it's great that people in the community get to see that.”

Carillo said individuals who are not involved in the manufacturing industry often assume that robots are only used in motor manufacturing or some sort of other automobile assembly. But he said companies across Arkansas are starting to use robots in everyday common activities, including packaging and casting. He said factories in Little Rock and Jonesboro are just two of several examples across the state using robots as an essential tool in the manufacturing processes.

It is for that reason that Carillo said ABB/Baldor partnered with UAFS to make sure the school had the tools it needed when it launched the program.

UAFS Chancellor Dr. Paul Beran said in February that in addition to the robot donation from Baldor, Gov. Mike Beebe had also made available $300,000 to the university to launch the program. But Beran added that the decision to go with a robotics certificate was not made "on a whim," but instead was created after much research, adding that the next closest academic robotics program was in Indiana.

Carillo said the need exists in Fort Smith and the entire state for individuals who know how to work with robots and maintain them, adding that some lower-end models can be purchased for as cheap as $25,000, making it far more feasible for local manufacturers than even just five years ago.

And that's why Long said the public needs to make itself aware of the role robots play in the economy today and will continue to play in the economy as time goes on.

"It's really becoming a critical component for manufacturing and there's so much manufacturing that goes on in Arkansas, that we are seeing the need for the students to come out and become part of our teams who can support this type of manufacturing process. And that's why we're so proud of the university for offering another set of skills for students that are going to walk out and have something that we're looking for right now.”

The tournament will start at 1 p.m. with a shotgun start, according to Director of Operations Tamara Fitzpatrick of the Fort Smith Regional Chamber of Commerce. Long said the robot is expected to be set up along the first nine greens.

The Wal-Mart shareholders meetings have become part late-night talk show, part church service/pep rally, part United Nations parade, with a retail Woodstock music festival sans the hippies, mushrooms and mud. And that was the case this year, to include Harry Connick Jr. in what may have been an impromptu performance of “Just a Closer Walk with Thee.”

And it may be a rare year that a change in Wal-Mart CEO is not among the more notable changes or news in the world of retail. This is one of those years. And comments about a plethora of those changes – new ways to reach the consumer, tethering stores to better serve customers, the “Savings Catcher,” new store formats – were part of Friday’s (June 6) shareholder meeting attended by an estimated 14,000.

Doug McMillon moved on Feb. 1 from his Wal-Mart International post to succeed Mike Duke as president and CEO of Wal-Mart Stores. McMillon said during the shareholders meeting, held at Bud Walton Arena on the University of Arkansas campus, that the customer remains the focus through all the new technology and new physical formats.

“Without them (customers) we don’t have jobs,” McMillon said, adding that it’s important that Wal-Mart employees work to keep the customers happy.

To reinforce that point, pop music sensation Pharrell Williams, along with his trademark hat, sang his hit song, “Happy.” His performance was followed by the stage entrance of Harry Connick Jr., who would serve as the celebrity emcee of the shareholders meeting. Other entertainers performing at the meeting included Robin Thicke, Sarah McLachlan, Aloe Blacc and Florida Georgia Line.

CHANGES
The year has delivered several physical changes and experiments in how the world’s largest retailer plans to boost business in what has been a flat U.S. market.

The company unveiled its new convenience store format – Walmart to Go – in March and judging by media and retail industry reaction it seemed that Wal-Mart announced it was selling dimes for 5 cents. This little (relatively speaking) 5,000-square-foot format now open in Bentonville just a short Ford pickup drive from the corporate headquarters is Wal-Mart’s effort to capture more of the $415 billion “quick-trip” market consumers make between their big grocery and shopping runs.

Bill Simon, CEO of Walmart U.S., also announced during the year that the company would invest in pick-up depots that will allow shoppers to drive through and get their online grocery order that was  placed earlier in the day. The “Walmart to Go” grocery delivery test market will also be expanded this year. It is already available in Denver, San Jose, Northern Virginia, Philadelphia and Minneapolis. Wal-Mart also plans to ship product from 50 more of its supercenter locations this year. This effort to tether supercenters to smaller formats and e-commerce fulfillment is key to Wal-Mart being able to better compete for Amazon Prime customers.

Part of Connick’s emcee work was scripted for him to talk about buying a Beignet mix online and then picking it up at his nearby Wal-Mart.

The drive-through pick-up for online orders was tested in 11 stores in the Denver area and are yielding a 90% satisfaction rating with consumers. The test in the Denver market was first announced in October. Shoppers pull into the parking lot and a loader brings the items to the car. Wal-Mart also allows order pick-up through the drive-in pharmacy line. Wal-Mart has obtained approval to build to 15,000 square-foot retail warehouse facility in Bentonville with 52 parking places — 33 for customers driving through to pick up grocery orders and 19 for employee parking.

The drive-in service is more about convenience, and those fill-in trips mid-week, an area that Wal-Mart has lost sales to in recent years from the rise of smaller format dollar stores and convenience stores. Simon said this quick-trip market is worth $415 billion annually and equals some 40% of the U.S. grocery spend. Wal-Mart’s share is just 10%, something the retailer thinks it can improve.

The company is also getting into the organic food business. Sales of organic products rose 11.5% last year to $35.1 billion, the fastest growth rate in five years, according to the Organic Trade Association. It’s anyone’s guess what that number will look like next year as Wal-Mart expands its organic products under the Wild Oats brand.

‘A REVIVAL’
When the early portion of the entertainment wrapped up, Wal-Mart Board Chairman Rob Walton recalled the days when his father, Wal-Mart co-founder Sam Walton, presided over the shareholders meeting. Rob Walton noted that his father referred to the 1985 meeting as “a revival.” That meeting was attended by 400 associates from 20 states.

“Things have changed a bit, folks,” Rob Walton told the estimated crowd of 14,000 from 27 countries.

Rob Walton also preached a “customer-centric” focusing, saying that no matter how technology and formats change the business, the “focus remains on the customer.”

He also welcomed Doug McMillon to the role as CEO, saying that McMillon, who began has an hourly employee at a distribution center, is “truly an associate-CEO.” He added that McMillon is an example that all Wal-Mart employees “can go as far as your hard work and talent will take you.”

In ending his opening remarks, Rob Walton said Sam Walton once ended a note to shareholders with the sentence, “Let’s go for it.” He said that attitude is still needed across all Wal-Mart operations.

“Let’s go and build the Wal-Mart of the future,” Rob Walton said.

SHAREHOLDER PROPOSALS
The meeting was not all rah-rah for Wal-Mart.

A representative of OUR Walmart, a union-funded group that has worked to raise wages and improve working conditions at Wal-Mart, spoke for a shareholder proposal seeking an independent Board Chairman. The representative said “serious scandals” at the company call for someone who is not a Walton family member to lead the board. The call for an independent chairman received a surprising amount of applause throughout the crowd.

Cambria Allen, representing groups who own 2.6 million Wal-Mart shares, asked shareholders to approve a “clawback” provision that would return compensation from executives who caused the company to be assessed fines for corruption or other problems.

“Wal-Mart has a clawback with no teeth,” Allen said.

The two proposals were not supported by Wal-Mart, and did not receive shareholder approval.

Presentation of the shareholders proposals critical of Wal-Mart were followed by pop star Robin Thicke singing “Blurred Lines.”

FINANCIALS
Cutting to the chase, Wal-Mart Chief Financial Officer Charles Holley told the shareholders that the company did have a difficult year in fiscal year 2013.

“It was a pretty rough year by anyone’s standards,” Holley said.

And the company’s first quarter earnings were ugly. The retailer reported per share net income for the first fiscal quarter of $1.11, below the consensus estimate of $1.15. The company earned $1.10 per share from continuing operations. Total revenue of $114.96 billion was up slightly over the $114.07 billion in first quarter of 2013 and was below the consensus estimate of $116.27 billion.

Company officials said the first quarter was hit hard by unusual winter weather in the U.S. during January.

Comp traffic for Walmart U.S. was down 1.4% in the quarter, despite a 1.3% uptick in the average shopper ticket. This marks the fifth consecutive quarter of negative to flat comparable sales, the benchmark metric used to measure retail performance.

And the second quarter may not be a big improvement. The company is predicting earnings per share in the range of $1.15 and $1.25. The company hit $1.24 per share in the second quarter of the previous fiscal year.

But Holley ended his comments with a litany of financial successes. He said the company has recorded $68 billion in sales growth in the past five years, and market value of the company has grown $50 billion in the past five years.

‘PICK UP UP THE PACE’
McMillon closed the executive comments with essentially a sermon about how Wal-Mart will do whatever it can to exceed the expectations of customers with more demanding expectations. He said the company will use a wide variety of technology to meet the customer where they want to do business.

To that point, McMillon said a majority of e-commerce traffic comes from mobile phones than desktop computers or other devices.

A unique product and service Wal-Mart may provide is 3D printing. McMillon said it’s possible, for example, that Wal-Mart can “print small replacement items,” that customers could pick up at a store.

The company will also add “collecting points” in which customers may order products and pick them at a non-store location. For example, the company is experimenting with collecting points in a subway in London and a train car in Ontario. He said someday “a school in Dallas” may be a collecting point to allow parents to pick up items as they pick up their children.

“All of these changes are a good thing for us … (and) only limited by our imaginations,” McMillon said. “We are picking up the pace of our change to better service our customers.”

He also said the company has to change in order to meet employee expectations, noting that new Wal-Mart employees never knew a world without the Internet or smart phones.

“You think they are going to expect more of Wal-Mart?” he said.

The world got a glimpse into the future board leadership for Wal-Mart Stores Inc. on Friday (June 6) as longtime chairman Rob Walton announced Greg Penner, his son-in-law, was chosen to fill a new position of vice chairman.

Penner, 44, has been a company director since 2008, and was re-elected along with the slate of 14 directors during Friday’s annual meeting in Fayetteville.

“One of the board’s most important responsibilities is long-term succession planning, and the company spends considerable time planning for stability and continuity, both at the board and management level,” said Walton, 69, who will remain chairman for the company is parents founded 52 years ago.

“In keeping with this commitment, I’m pleased with Greg’s appointment. Wal-Mart has benefited from his broad expertise in strategic planning, finance and investment matters. I’m excited about Greg working closely with me, the Board and the management team in guiding Wal-Mart into the future.”

Penner is chair of the technology and e-commerce committee and also serves on the global compensation and strategic planning and finance committees.

“I am committed to the long-term success of Wal-Mart,” Penner said in a statement. “My first Walmart experience was in 1994 and over the years I’ve developed a deep appreciation for our associates and their service to our customers. I look forward to contributing to a stronger Walmart in any way possible including how we develop new digital capabilities to add to our store offering. This is an exciting time to be part of Walmart.”

The appointment was announced just minutes after an eight-year employee from Indiana introduced a shareholder proposition asking the board for an independent chairman. Citing her $23,000 low wage and the high number of employees who are on food stamps, she said Mr. Sam founded a great company, but over the years he had help from his associates and part of his vision included a true partnership between the associates and the company leadership.

Walton announced later in the meeting that the proposal seeking an independent board chairman failed. Also failed were two shareholder proposals asking for lobbying disclosure and a report on recoupment of executive pay failed to gain the number of votes needed for adoption.

The Walton Family controls roughly 51% of the voting power in Wal-Mart Stores. The Wal-Mart board of 14 is comprised of nine independent directors, with a diverse range of expertise.

Walton said Penner brings broad technology and international business experience to Wal-Mart’s Board. He has been a general partner of investment management firm Madrone Capital Partners since 2005. He worked for Walmart International from 2002 to 2005, serving as senior vice president and chief financial officer for Japan. Prior to that role, he was senior vice president of finance and strategy for Walmart.com. Penner also worked as a financial analyst for Goldman Sachs & Co.

Wal-Mart said it has always strived to maintain high corporate governance standards. In keeping with this goal, and unlike most other companies in the Fortune 100, the board chose in 1988 to separate the roles of chairman and CEO.

In addition, the company said it has a number of corporate governance measures in place to ensure that the board acts independently of management.

For several years the central message and mission around Wal-Mart’s business strategy was growth, leverage and returns. Analysts from around the country noted a different message at this year’s annual shareholder meeting held Friday (June 6) in Fayetteville.

The notion of change and growth through tech innovation at the expense of lower returns in the midterm was constant throughout the speeches from Wal-Mart’s top executives over the past two days. CEO Doug McMillon, who also addressed the media following the Friday’s meeting, said in this new role assumed in February that he was able to let go of things that happened in the past as the leader of a complex international business and was given the freedom to think about what could be for the world’s largest retailer,

“I have tried to approach this role with high energy, while looking forward to many new possibilities,” he said. “Our people are going to be the magic that makes it happen.”

McMillon said change is inevitable and Wal-Mart, though a large company, is nimble enough to flex its offerings to fit what customers want and need – which is key to continued retail success in an ever-changing world.

“Retail has moved from a push system — where we pushed goods out to stores in hopes that you would buy — into to a pull system where consumers are pulling us along  and telling us what they want and where,” McMillion said.

When Wal-Mart sees something operationally that works well in a test phase the company must be ready to accelerate the pace and work with a sense of urgency to deliver, McMillon said.

“I would like to move a little faster, but not in a reckless manner,” he added.

Neil Ashe, CEO Wal-Mart Global eCommerce, said the talent the retailer has amassed in its WalmartLabs division is raising the bar on reducing cycle times for new platform and program launches from two years down to 20 days, something they recently accomplished on a technology platform for Sam’s Club members.

Bill Simon, CEO of Walmart U.S., said the retailer accelerated its new store projects by 150 additional units in the same fiscal year they were announced. 

“We have to be about the new and the now, and adding 150 additional stores within a year is pretty significant evidence that we move quickly to acceleration when it makes sense,” Simon said.

He was asked to define the limits that Wal-Mart’s infrastructure could handle in terms of speedy expansion. He said adding 300 smaller formats and 150 supercenters and remodels this year the retailer is likely pushing the limits. In a build-to-suit program with the neighborhood markets, Simon said the constraints will be in talent.

Simon was asked if these small formats are a game-changer for a retailer with 4,000 large stores in the U.S. alone.

“If there are 300 of these small stores in the universe it’s not very exciting, but if there is 2,000 (his vision) it gets much more interesting,” Simon said.

This change and tech innovation doesn’t come cheap. In terms of tech talent acquisitions last year the costs shaved 11 cents from the annual per share earnings. This year the company tagged 2 cents to 4 cents in per share earnings which will be sacrificed for more e-commerce acquisitions and growth opportunities in future quarters.

For the top Fortune 500 company, every cent earned or forfeited is highly scrutinized by Wall Street each quarter, but execs with the retailer and emerging tech company say investments in the “now” will be key to their broad goal of seamlessly merging the physical and digital retail worlds.

An analyst also asked if this constant catering to every consumer whim would likely be detrimental to margins in the long run. McMillon said his gut reaction about the investment payoff in the long term is positive because of operational efficiencies that are gleaned overtime. But it’s the mid-term — three to five years — that are the hardest to read as the company goes through transition with many new formats and delivery options.

“It’s not returns that I am worried about. We are a strong company and the returns will be okay overtime. I am concerned to make sure we are positioned for growth and executing what we have today. As long as we take care of that, I think these returns are going to work themselves out,” McMillon said.

When asked what was the most challenging aspect of his new role, McMillon told an analyst in attendance that he has been quoting him since October after a brief conversation the two had at the retailer’s annual analyst meeting.

“In years past when you visited Wal-Mart you said you saw leaders, but now what you see are managers,” McMillon shared. “Had we gotten so big that it took all of our time to manage that there was no time left for leading change?”

Continuing, McMillon said: “That question stuck with me, and it’s clearly one of the most challenging aspects of this new role. As a leadership team we have begun making time to collaborate on central issues and we all contribute so that when we reach the solution it is much better than any one of us could have reached on their own. We are looking forward more today than we have in the past two or three years,” McMillon said.