Comedian Tracy Morgan was injured in a multiple car pile up in New Jersey around 1 a.m. Saturday (June 7). James McNair, a friend and follow comedian traveling with Morgan, died in the accident when a Wal-Mart tractor trailer slammed into the back of their van. Four other vehicles were also involved in a chain-reaction when Morgan’s van flipped on impact.

Semi driver Kevin Roper, 35, was reportedly charged with one count of death by auto and four counts of assault by auto, according to The New York Times.

Wal-Mart said the facts are continuing to unfold, and if it’s determined that a company truck caused the accident, Wal-Mart will take full responsibility.

“This is a tragedy and we are profoundly sorry that one of our trucks was involved. We are working quickly to understand what happened and are cooperating fully with law enforcement to aid their investigation,” Wal-Mart Stores noted in a press release late Saturday afternoon.

“Safety is our absolute highest priority, but that is no comfort whatsoever to the families and friends who are suffering today. We offer them our deepest condolences. We can’t change what happened, but we will do what’s right for the family of the victim and the survivors in the days and weeks ahead. We’re praying for the family and friends of the passenger who lost his life in the terrible accident in New Jersey. Our hearts go out to everyone involved and we hope those who were injured get the care that they need and make a full recovery.”

Wal-Mart executives dedicated their 52nd annual shareholders festivities (June 3 -7) to their 220 million weekly customers around the globe. The messages of CEOs Doug McMillon, Bill Simon and Neil Ashe and other top execs were clear regarding the retailer’s efforts to woo new customers and retain the ones they have with more than just low prices.

About 2,200 Wal-Mart employees from across the nation and 4,800 from Walmart International heard directly last week that they make the difference in customer service. 

“The reason we are all here is the customer,” Gisel Ruiz, chief operating officer for Walmart U.S., said during the retailer’s U.S. meeting on Wednesday (June 4). She told the Wal-Mart employees to strive to make a difference through top customer service.  Walmart U.S. CEO Bill Simon said that each one of them had the opportunity to impact real change through stellar customer service.

Unfortunately, the buzz of shareholders week of activities was muted somewhat following an New Jersey accident in which comedian and Saturday Night Live alum Tracy Morgan was critically injured when a van he was in was hit by a Wal-Mart tractor-trailer. The wreck killed comedian James McNair. The driver of the Wal-Mart rig reportedly fell asleep.

“This is a tragedy and we are profoundly sorry that one of our trucks was involved. We are working quickly to understand what happened and are cooperating fully with law enforcement to aid their investigation,” noted a Saturday afternoon statement from Wal-Mart Stores.

WAL-MART PERCEPTION
In multiple surveys during the past year, Wal-Mart ranked behind other retailers (Trader Joes, Kroger, H-E-B)  in customer service. That said, Wal-Mart is still the most shopped retailer in the world, boasting combined net revenue of $473 billion last year.

Much is written about Wal-Mart’s stagnant and lackluster comp sales in the U.S. segment, but companywide, annual sales have grown at a compounded annual rate of 3.4% over the past five years through ongoing economic recovery. Most of that growth has been in e-commerce, ($10 billion last year, and $13 billion expected this year) an area the retailer says it will continue to invest in talent and tech acquisitions in the mid-term, even if it slightly dampens shareholder returns.

McMillon told shareholders during Friday’s (June 6) annual meeting that first and foremost, “we will be a customer-driven company. We've always said the customer is our boss and we'll make decisions based on how we can serve them better.” He also said investing in talent and innovating for the future round out the retailer’s three main ares of focus looking forward.

CUSTOMER-CENTRIC
Simon said the retailer continues to introduce more services like cheaper money transfers and insurance comparisons and expanded merchandise like Wild Oats organics in its customer-centric agenda. This is on top of everyday low prices with a money-back guarantee and the Savings Catcher initiative that will be rolled out and expanded later this summer.  

Nearly a million receipts have been processed with Savings Catcher in the limited trial of the past two months, the company said. Simon said it’s been the most successful program test at Wal-Mart thus far. Stephen Quinn, executive vice president of marketing for Walmart U.S., said Savings Catcher is changing customer behavior.

“They (shoppers) don’t have to clip competitor coupons and closely check sales circulars because Wal-Mart will do that work for them when they sign up for Savings Catcher,” Quinn said.

Later this summer the savings will include produce and general merchandise which are expected to bring more shoppers into the program. Analysts have said the Savings Catcher and soon-to-be-offered e-receipts will give the retailer more insight into individual shopper purchases that may then be used to create shopping lists for the customer in the coming months.

“The best shopping lists are those you don’t have to create yourself,” said Gibu Thomas, senior vice president of mobile and global e-commerce. Thomas said Wal-Mart will continue to use technology in exciting ways to get closer to the customer. 

CONVENIENCE PLAY
Simon said Wal-Mart is also providing increased convenience with more smaller formats that are linked to 7 million online items, many of which can be delivered within two days thanks to a third online fulfillment center coming to Indiana later this year.

Wal-Mart also uses 50 supercenters to pick online orders, a program that will be expanded to at least 150 supercenters this year. Wal-Mart’s click-and-collect program where consumers order online and pick up at a local store is being expanded from 300 stores to 600 stores next year following positive tests in the Denver market.

Simon said in markets like Denver where the majority of consumers drive to work, the click and collect option is popular. Other markets where mass transit is popular the click and collect can take another form where consumers pick-up their online order at a train station or near their children’s school.

McMillon said the goal is to adopt something like he saw at ASDA recently. He said the grocery order was placed online to pick up at the store. But on the way to the store, the shopper remembers three or four items left off the online order. When arriving at the store, the shopper can run inside and gather the three items left of the list and have them packaged with their online order and loaded in their vehicle.

CUSTOMER STUDY
While all retailers are studying consumer behavior, McMillon said Wal-Mart has accumulated 30 petabytes of shopping data.

“In case you don’t know how much that is, one petabyte will hold enough music to play for 2,000 years,” McMillon said.

From that data Wal-Mart attempts to give consumers everything they want, and even some things they might want but don’t know yet. The retailer is gleaning many “learnings” from its ASDA grocery business in London. Those ideas and the woman behind many of them — Judith McKenna —recently transferred to Bentonville to oversee the development of new store formats, such as Wal-Mart's smaller-format convenience and grocery stores.

McKenna said lessons learned from ASDA and the Denver test – which was combined with home delivery – indicate consumers tend to move quickly to the online order and pickup grocery model. She said home delivery requires someone be home to get the order, and in many cases it’s more convenient to pick up the order while on the way home. McKenna is part of Wal-Mart’s innovation and small store/online strategy team.

INNOVATION FOR CUSTOMERS
Inside Wal-Mart innovation labs the retailer is constantly looking for ways to use technology to enhance the shopping experience, as well as increased store efficiencies designed to leverage its massive physical presence with its emerging online business.

Simon said last week the retailer is testing several programs simultaneously. One of the most important in the mix is the Express store build out. Wal-Mart has about 20 Express stores, with plans to build 100 more this year. The hybrid stores offer food, fuel and pharmacy with limited onsite general merchandise. However, the store is “tethered” all the products in a nearby supercenter, which is “tethered” to the 7 million online items at Walmart.com.

“The comps in these hybrid stores are very good, and this build up in store units this year to 150 or so will give us more insight into how the consumer will use them,” Simon said.

McMillon has been talking up 3-D printing in the media lately, because he believes it has  “retailtainment” capabilities on a novelty level and much bigger implications in product replacement. The retailer tested 3-D printing in a few sites around the globe in recent months. Neil Ashe, CEO of Walmart Global e-Commerce, said the highest comp day in history in the San Bruno Wal-Mart was the day the store had the 3-D printer.

Tyson Foods on Monday (June 9) placed an $8.55 billion bid on the table for Hillshire Brands causing bidding competitor Pilgrim’s Pride to fold. The Tyson offer, the biggest meat deal in U.S. history., has not yet been accepted. Pilgrim’s said it will not make a counter offer.

“The Hillshire Brands acquisition would represent a defining moment for Tyson Foods,” Donnie Smith, Tyson’s president and CEO, said in a statement. “Our strategy has been to grow our prepared foods business, and it has been our aspiration to be a leader in retail prepared foods just as we are in chicken. Now we will have those iconic #1 and #2 brands in numerous categories.”

Officials with Tyson Foods and Hillshire Brands acknowledged the $63 per share cash offer Monday which would require Hillshire to walk away from its pending $6.6 billion acquisition of Pinnacle Foods, a deal announced May 12. 

Pilgrim’s Pride CEO Bill Lovette said $55 was their top offer.

"As a disciplined acquirer, we determined that it was in the best interests of our shareholders not to increase our proposed price of $55.00 per share in cash," Lovette said in a statement. Pilgrim’s Pride is owned by Sao Paulo, Brazil-based JBS S.A.

Hillshire execs confirmed the offer from Tyson, but said the deal is far from a sure thing.

“The Hillshire Brands board of directors has not approved the Tyson Foods offer, has not changed its recommendation regarding the Pinnacle merger and is not making any recommendation with respect to the Tyson offer,” Hillshire management noted in a release on Monday. “Hillshire Brands does not have the right to terminate the merger agreement with Pinnacle Foods on the basis of the Tyson Foods offer or enter into an agreement with Tyson Foods prior to its termination. There can be no assurance that any transaction will result from the Tyson Foods offer.”

Bidding for Hillshire began in late May when Pilgrim’s Pride offered $5.52 billion for the company. Tyson Foods countered a few days later with a $6.8 billion ($50 per share) offer. Pilgrim’s countered that with a $7.7 billion ($55 per share) offer on June 3.

Tyson would also be asked to pay the $163 million termination fee to Pinnacle if Hillshire accepts the Tyson bid which will stand until the termination of the Hillshire/ Pinnacle deal on Dec. 12, 2014.

Jimmy Dean, Ball Park and Hillshire Farm are a few of the brands owned by Hillshire.

“The combination of Tyson and Hillshire Brands would reposition Tyson as a clear leader in the retail sale of prepared foods, with a complementary portfolio of well-recognized brands, including Tyson, Wright Brand, Jimmy Dean, Ball Park, State Fair and Hillshire Farm,” Tyson Foods noted in the statement. “In particular, the strength of Hillshire Brands’ products in the breakfast category would allow Tyson to capture opportunities in this attractive and fast-growing day part.”

The pro forma company would give Tyson the No. 2 market share ($3.3 billion) in the frozen value-added category, leap frogging ConAgra in retail sales, according to Tyson. Tyson now has the No. 3 spot with $2.4 billion, and Hillshire ranks eighth at $1.3 billion.

The prepared foods segment is now 9% of Tyson Foods’ $35.4 billion in annual sales. If the deal happens, the combined companies would annual revenue of around $39.4 billion, with 18% of that coming from prepared food sales.

Alexia Howard, a senior research analyst at Sanford Bernstein, has said the deal at $50 made 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.

Analysts were a bit more concerned with the $63 offering. They quizzed Tyson officials as to why they would offer a hefty price for the maker of Jimmy Dean sausages.

Smith said Tyson scouted Hillshire for “a long time.” Tyson Foods said the deal could boost earnings within the first fiscal year after the deal is completed. Company officials also predict more than $300 million in synergies – savings through reducing or eliminating duplicative tasks, operations and personnel – through purchasing, supply chain and marketing efforts.

Shareholders were uncertain with this latest Tyson bid and began to sell off shares in the morning session with the price tumbling 4.66% to $38.26. In late afternoon trading, the share price fell more than 6.5% and was trading around $37.45. The share price closed Friday at $40.12. During the past 52 weeks, the share price has ranged from a $44.24 high to a $24.74 low.

Contributing analysts on CNBC agreed the 16.7 times earnings valuation for Hillshire in the Tyson deal puts the Springdale meat company on the edge of comfort with retaining its investment grade credit rating. Tyson justified the 16.7 times earnings valuation and said it will decline to 10.5 times when the $300 million in operational synergies are realized over the next three years.

BB&T Analyst Brett Hundley downgraded Tyson Foods from a “buy” to a “hold” citing the bidding between it and Pilgrim's Foods. Hundley noted to investors on Friday that the bids were getting too rich to make the numbers work.

"Bidding wars can sometimes leave casualties. The situation with Hillshire is starting to approach this level," he noted to investors.

Tyson Foods said it is not going to gamble away its investment grade credit rating, but it is prepared to issue debt and equity as needed. The transaction would be funded by cash on hand and a bridge loan from Morgan Stanley Senior Funding Inc., and JP Morgan Securities. Tyson anticipates the substantial cash flow from the combined companies will enable it to rapidly pay down debt.

Community bank soundness is another sign of the local economic recovery in Benton and Washington counties as well as the Fort Smith metro area. Through the first quarter of 2014 the majority of local banks are profitable, but a few remain in troubled waters given their high Texas Ratios — a standard measure of a bank’s credit troubles.

The Texas Ratio looks at a bank’s non-performing assets and loans delinquent 90 days or more divided by tangible capital equity and loan loss reserves. A ratio of more than 100, or 1:1, is considered a warning sign, according to Investopedia.

HIGH AND ELEVATED TEXAS RATIO NUMBERS
222.15% – Pinnacle Bank in Rogers
126.35% – Allied Bank in Mulberry

Other local banks with elevated Texas Ratios of more than 50% include:
57.91% – Signature Bank of Fayetteville
55.59% – First State Bank of Lonoke
61.43% – Chambers Bank of Danville
77.67% – Decatur State Bank, Decatur

Each of the above listed banks remain under enforcement actions by federal regulators because of their higher ratios of non-performing loans to the bank’s overall capital equity levels. That said, all but one of the six banks listed each returned profits in the recent quarter and ended 2013 on a positive note.

NET PROFITS
Signature Bank
1Q 2014: $473,000 
Fiscal 2013: $1.044 million

Chambers Bank
1Q 2014: $2.547 million
Fiscal 2013: $4.349 million

Decatur State
1Q 2014: $1.158 million
Fiscal 2013: $1,100

First State Lonoke
1Q 2014: $164,000
Fiscal 2013: $254,000

Pinnacle Bank
1Q 2014: $8,200
Fiscal 2013: $158,000

Allied Bank Mulberry
1Q 2014: $18,000 loss
Fiscal 2013: $3.121 million loss

SLOW RECOVERY
The financial health of the Northwest Arkansas banking sector is recovering and helping to fuel bank mergers among some of the distressed banks in need of capital infusion. Metropolitan National, Decatur State and First Community Bank of Crawford County were among merger deals completed in 2013.

John Dominick, a bank consultant and professor of finance at the University of Arkansas, has said the banking climate is improving in Northwest Arkansas, the most competitive market in the state. He said it takes time for banks to work through the high levels of real estate remaining on their books following the local housing and commercial building booms and busts in the past decade.

He said local banks are making money again, but some are having to set aside large reserves for potential loan losses and that is expected to continue for a few more quarters. These provisions to reserves come at the expense of higher profits but are required by regulators closely watching a handful of local banks still operating under enforcement actions.

Other banking analysts say more mergers are likely, particularly with smaller family owned banks being bought by larger institutions like Simmons First National, Home Bancshares, Bank of the Ozarks and Arvest, all of which completed acquisitions in recent months.

Mark Saunders, managing director for Bank Street Partners, recently told The City Wire that with fewer bank failure deals to acquire through FDIC actions, aggressive banks are seeking strategic acquisitions to help them grow regional market share. He said the timing is ripe for more consolidations of smaller banks that cropped up in the past decade with plans to sell when valuations rose.

Saunders said the small banks have a tougher time competing on loans, and their regulatory oversight costs are rising to the point where earnings are squeezed.

FIS RATINGS
Another rating indicator for banks on the watch list of federal regulators is the FIS Rating, which evaluates a bank’s liquidity, asset quality, capital adequacy and earnings. 
The overall rating is determined by weighting the individual component ratings. The best score that can be achieved is 1 and the worst score is 5.

By FIS standards Allied Bank and Pinnacle Bank each rank poorly at 4.19 and 4.15, respectively, at the end of the first quarter of 2014. Those rankings were the same to end 2013.

Signature Bank had a FIS Rating of 3.8 at the end of the first quarter. Chambers Bank had a rating of 3.54, the Bank of Fayetteville’s rating was 3.48 and Arvest was 3.52. At the high end of the rating, First Security posted a 1.56.

In the Fort Smith metro area FIS Ratings ranged from 3.59 at Benefit Bank to 2.93 at First National Bank of Fort Smith.

Two job announcements in two days will bring 325 new jobs and a former U.S. Vice-president to Arkansas.

On Tuesday (June 10), Arkansas economic officials will break ground in Osceola on a new e-waste recycling facility.

BlueOak Arkansas will focus on recycling metals from discarded circuit boards and other electronics. The project is expected to create 75 new jobs.

According to The Blytheville Courier, the invitation-only event will feature speeches by former Vice-president Al Gore, Gov. Mike Beebe and John Correnti, who is leading the Big River Steel superproject in the region. Correnti is executive chairman of BlueOak Resources.

In Sherwood, TeleTech Holdings, Inc. opened a new customer service center adding 250 jobs to central Arkansas.

The center will officially open its doors in July and is now hiring for a variety of jobs serving TeleTech’s clients in the healthcare industry.

TeleTech’s new center, located in the Wildwood Centre & Medical Tower, will represent a nationally-recognized, public health insurance client, and therefore is seeking prospective job applicants with life and healthcare licenses.

“In our commitment to supporting employment growth in local communities throughout the U.S., we are delighted to work with the state of Arkansas to bring more jobs to its citizens,” said Kenneth Tuchman, chairman and CEO of TeleTech. “The Little Rock area holds great talent and expertise that will help us expand and improve upon the services to our clients.”

TeleTech is accepting applications for customer service representatives, team leaders, trainers, recruiters and IT specialists.

Arkansas is among the majority of states where foreclosure fillings are subsiding to five or six year lows as the housing market recovery shows strength in a slowly improving economy. There were 391 foreclosure filings across the Natural State in May, down 53.89% from a year ago, according to Irvine, Calif.,-based RealtyTrac.

Nationwide, there were 109,824 filings for default notices, trustee sales, and bank repossessions in May, down 26% from a year ago and the lowest monthly level since December 2006, RealtyTrac reports.

All but 11 states posted annual decreases in their foreclosure filings in May.

“It’s not surprising that some of the states with the longest foreclosure timelines are those with markets still dealing with increasing foreclosure activity even as the country as a whole continues to hit new lows,” said Daren Blomquist, vice president at RealtyTrac. “On the other hand, the increase in bank repossessions in some states with shorter foreclosure timelines like California and Oregon demonstrates there is still some pent-up foreclosure activity in those states as well.”

Arkansas is a non-judicial state, which means there is typically a shorter foreclosure timeline as a judge does not have to sign the order. The average foreclosure time in Arkansas is around 290 days, but it can happen as soon as 120 days if there is no second lien and the homeowners vacate the property prior to the scheduled sale date.

Sebastian County reported five new foreclosure filings in May, down 80% from a year ago. The rate of incident last month was one in every 10,934 households in Sebastian County. At the market peak the rate was one in every 739 households.

In smaller Crawford County, RealtyTrac reports six new foreclosure filing in May, a 33% reduction from a year ago. The incident rate was one in every 4,331 households in May, down sharply from one in every 562 housing units in December 2009 deemed near the market foreclosure peak.

In recent years Benton County consistently led the rest of the state in foreclosure activity fueled in part because of the rising home prices and easier loans made in a hyper competitive banking climate. Local real estate experts believe those days are gone as the number of new foreclosures are getter fewer and farther between.

RealtyTrac reports there were 42 filings in Benton County during May, down 74.39% from a year ago and ranking No. 10 in the state. In the height of the real estate market correction in January 2009, Benton County had 559 new foreclosures pending, according to RealtyTrac – or one in nearly 145 local households during all of 2009.

Filings per household in Benton County are down to one in every 2,213 mortgages in May, RealtyTrac reports.

In Washington County, there were were just 13 new filings in May, down 79% from the year-ago period. At the market height the county reported 235 new filings in January 2009. The rate of incident is down from one in every 340 households at the market peak in January 2009 to one in 6,728 households in May.

Jim Long, a real estate agent with Crye-Leike Real Estate in Bentonville, said there are 205 foreclosure for sales in the local multiple listing service, which includes all four of the counties in this report. The number of listed homes are up from 153 in the listing service last month, but have trended lower over the past year. In December 2013, there were 322 listings of foreclosures in Northwest Arkansas and the Fort Smith metro area.

Joel Anderson, Walmart.com president for the past three years, has resigned to take a job with another company.

Teen discounter Five Below has named Anderson as its president. He will oversee the retailer’s merchandising and marketing beginning in July.

Wal-Mart also announced the promotion of Fernando Madeira, who has been the president of Walmart’s Latin American e-commerce division. He will now lead Walmart.com in the U.S., Latin America and other growth areas.

Collaboration between the retailer and supplier is nothing new, but a new facility recently opened by Crossmark in Bentonville is designed to offer a new level of technology and virtual planning for suppliers doing business with Wal-Mart Stores. The new center is located at ground zero for retail – directly across the street from Wal-Mart’s corporate office.

The Crossmark Center for Collaboration is 19,000-square-feet of meeting space that is equipped with technology throughout, a test kitchen for food suppliers, and a catering kitchen. The center also provides two separate lab spaces with a high resolution touch screen that covers one full wall.

The two labs can be used for modular space planning in the virtual world and for shopper marketing tests. Planning in the virtual space can save time and labor of multiple modular reconfigurations when trying to get the right set-up.

There are nine conference rooms with large screens that are connected directly to the Internet, which are much more functional for Wal-Mart suppliers involved in joint business planning with the retail giant. Crossmark did not give the exact cost of this new center, but planning records projected the cost between $5 million an $8 million. 

“Most meetings between supplier and retailer occur in these small rooms at the Wal-Mart home office. These rooms are not large enough to accommodate larger groups like the joint business plan meetings and they are not equipped with the latest technology,” said Mike Graen, vice president of collaboration at Crossmark. 

Graen spent 25 years at Proctor & Gamble calling on Wal-Mart, and then five years at Wal-Mart working on supplier collaboration. He joined Crossmark in October to head up this new collaboration lab which was just completed and is now giving tours to local suppliers and potential members.

“This new center is not a corporate office for Crossmark. There are three people who work in this building including me. We see this center as a neutral facility where Wal-Mart and suppliers large and small can come together to collaborate on their business relationships to better serve their customers,” Graen said.

Duncan Mac Naughton, chief merchandising officer for Walmart U.S., said recently that the retailer’s goal is to do 300 joint business plans with suppliers each year. Wal-Mart has been completing about half that amount in recent years.

Graen said the center will help suppliers focus on core items, conduct shopper research and test new concepts that could positively impact their respective businesses. It’s also a training center and offers a large open space that can accommodate about 100 people. 

He said the building capacity is about 450 and with the large screens in each room the full house could be connected via technology. There is also a separate work room to accommodate suppliers who have presentations in the building when they are not in the meeting. Graen said they have piped in the flight schedules to Northwest Arkansas Regional Airport and have a printer set up for boarding passes to accommodate suppliers who will work out of the center while in town to see Wal-Mart.

Graen’s Wal-Mart years included work on the SPARC (Supplier Portal Allowing Retail Coverage) project, which was a collaboration between the retailer and several suppliers aimed at providing more info on inventory and to improve on-shelf availability.

Graen said there is a training lab in the new collaboration center to help merchandisers and suppliers with improving on-shelf availability.

“The initial reaction from Wal-Mart and suppliers who have toured is quite positive. I foresee this building being used a lot. Any supplier can use the space if they are a member. We charge memberships for certain hour usage. For instance $10,000 a year will get you 100 hours up to $50,000 a year for 500 hours,” he said. “You don’t have to be a Crossmark customer to use the space.”

Excitement is brewing in downtown Springdale with news that an entity funded by the Walton family — Downtown Springdale LLC — has acquired a major landmark building at 202 E. Emma Ave. The San Jose Manor building was home to Ryan’s Clothing for more than 50 years before the retailer closed in 2013.

Max and Robert Ryan sold their interest in the building for $250,000 in May to Downtown Springdale LLC. Mid-America Management Associates just closed the sale of their majority interest in the property for $970,000, according to county real estate records.

The $1.22 million Walton family investment is a catalyst to help spur more development in downtown Springdale, according to city leaders. The Walton family has not announced plans for the purchased site which runs along Emma Avenue from Spring Street to N. Commercial Street.

Perhaps a mixed used space anchored with a Walmart Neighborhood Market is possible, like the one under construction in downtown Bentonville. Dity officials said it’s anybody’s guess what the Walton’s have planned at this time.

“When I came down here to Springdale I told the Jones Trust board that I could help the environment in the Jones Center, but we needed to work on improving the surrounding area because downtown Springdale has the greatest potential of all the area downtowns,” said Ed Clifford, CEO of the Jones Center.

For years Clifford, as CEO of the Bentonville Chamber of Commerce, had a front row seat to witness community investment toward downtown revitalization. Support from Wal-Mart, Walton family and a plethora of smaller investors has transformed the Bentonville square and is ow adding two new downtown initiatives — the Market and Arts districts.

“The Walton family investment in Springdale sent a signal to lots of people that this development is really going to happen,” Clifford said.

The interest in downtown Springdale is a long time coming, said Mayor Doug Sprouse, adding that the Razorback Greenway work which runs through the middle of downtown Springdale creates momentum for development. Sprouse said the Walton Family Foundation and their vision for the Razorback Greenway helped breathe new life into downtown Springdale with $10 million in matching funds toward the city’s leg of Greenway.

The city recently purchased two buildings along Mill Street and is tearing them down to make room for Turnbow Plaza, a downtown park that will be located on the banks of Spring Creek along the Razorback Greenway, which is about one block from the site purchased by the Walton family.

“This recent investment from the Walton family, Tyson Foods and the Care Foundation in our downtown legitimizes the revitalization efforts that have started and failed so many times before,” Sprouse said.

Last month the Care Foundation gave the city $493,000 to build Turnbow Plaza and Tyson Foods anted up $100,000 for the building demolition and debris removal. Tyson is also in the process of acquiring the Jeff Brown Building at 317 E. Emma Ave. The meat giant recently announced plans to relocate some of its corporate staff to downtown Springdale into one of its corporate buildings along Emma Avenue, but gave no timeline for that move.

“I can’t say enough about the importance of Tyson’s plan to house some corporate staff downtown. It’s a huge deal because this will mean foot traffic that can help spur more retail and restaurant growth as the trail work is completed over the next year,” Sprouse said.

Clifford stands by his belief that when all is said is done, downtown Springdale will shine brighter than the rest. He said the trailhead at the Jones Center is halfway between Bella Vista and Fayetteville along the Razorback Greenway. The Jones Center will be the parking area and rest room facility for hundreds who will use the Greenway each week. 

Clifford and Sprouse agree that having Spring Creek, the railroad and the Jones Center  attractions along Emma Avenue in downtown Springdale, will set the city apart.

“We are on our way and it’s exciting to think about the possibilities,” Clifford said. 

Springdale City Council will decide on Tuesday (June 10) if they want to approve an $825,051 matching grant from the Walton Family Foundation to build a mountain bike trail in the northern part of the city near J.B. Hunt Park. The total cost of the 2.6 mile mountain bike trail is expected to be $1.65 million. City officials said if built the trail will connect to the Razorback Greenway. If approved, construction will begin immediately in hope of completion by the end of the year.

Arkansas’ economy gained strength in 2013 as the state’s gross domestic product (GDP) grew at 2.4% in 2013, ranking The Natural State 16th among the 50 states, according to new statistics released Wednesday by the Bureau of Economic Analysis (BEA).

Arkansas’ growth was well ahead of the U.S. average in 2013, which slowed to 1.8% in 2013 after increasing 2.5% in 2012, according to the statistics from the U.S. Labor Department analysis arm.

Still, real gross domestic product (GDP) increased in 49 states in 2013, but the surprise takeaway from the yearly report is that U.S. growth was widespread but lost momentum. Per capita real GDP ranged from a high of $70,113 in Alaska to a low of $32,421 in Mississippi. Per capita real GDP for the U.S. was $49,115.

In the Southeast region, Arkansas only trailed West Virginia – which grew at a whopping 5.1%. Virginia had the lowest GDP at 0.1%, while the entire 12-state region came in at 1.6%.

‘UNUSUAL’ GROWTH
John Shelnutt, head of the Arkansas Department of Finance and Administration’s Economic Analysis and Tax Research division, called the sources of growth in Arkansas “a little unusual.” He said the state experienced robust gains in the service and agriculture sectors, but saw contraction in construction and manufacturing. The government sector in Arkansas also lost momentum, mainly in the number of federal and Postal Service jobs.

But the most unusual source of growth came in the mining sector, which saw a huge decline in 2012 as natural gas prices and low rig counts buffeted the Fayetteville Shale. This year, that sector rebounded with vigor.

“That is a little odd because it is a volatile sector where (growth) doesn’t persist year after year, or multiple years,” Shelnutt said. “It could be seen as a one-time contribution. It is a rebound from the negative year in 2012, but goes beyond a simple recovery.”

Just last month, severance tax collections in 2014 set new record highs as Arkansas continues to reap the benefits from higher natural gas prices and steady production levels primarily in the Fayetteville Shale, state revenue statistics show.

For the first three months of 2014, gross natural gas severance tax revenue came in at $19.9 million, up 29% from $15.4 million in the same period of 2013. At the same time, monthly collections of $7.3 million and $9.1 million in March and April, respectively, were the highest severance tax revenue totals posted since the state began keeping such records.

Overall, severance tax collections for January, February, March and April all came in well above $6 million, also a first for the state of Arkansas. The fiscal year for the state of Arkansas begins on July 1, 2013 and ends on June 30, 2014. In fiscal 2013, the highest monthly severance tax collection was $5.8 million in June. The severance tax data is compiled by the Revenue Division of the Arkansas Department of Finance & Administration using monthly tax reports filed by producers.

Shelnutt added that Arkansas’ growth in 2013 could be an anomaly.

“It is nice to get those,” said the state’s chief economist, noting the growth in the mining sector. “But you can’t count on them.”

Growth in GDP does not necessarily translate to job growth. The number of employed in Arkansas stood at 1.228 million in December 2013, down 0.19% compared to December 2012, and down 2.19% compared to December 2011. The number was also down 5.76% – or more than 70,000 employed – compared to peak employment of 1.299 million in March 2008.

The number of employed in Arkansas during April 2014, the latest month data is available, was 1.235 million, down from 1.238 million in March, but up from the 1.227 million in April 2013.

MANUFACTURING STRENGTH
GDP by state is the state counterpart of the Nation’s gross domestic product (GDP), the Bureau’s featured and most comprehensive measure of U.S. economic activity. Real GDP by state is an inflation–adjusted measure of each state’s production based on national prices for those goods and services produced within each state.

Overall, nondurable-goods manufacturing; real estate and rental and leasing; and agriculture, forestry, fishing, and hunting were the leading contributors to real U.S. economic growth.

And although mining was not a significant contributor to real GDP growth for the nation, it did play a key role in several states, including Arkansas. This industry was a large contributor in five of the fastest growing states: North Dakota, Wyoming, West Virginia, Oklahoma, and Colorado. Growth in those states was propelled by the recent development in liquids-rich shale plays that are attracting billions in new investment.

Meanwhile, real GDP increased in all eight BEA regions. Growth accelerated in the Rocky Mountain and Plains regions. The Rocky Mountain region grew the fastest, led by Wyoming, which increased 7.6%.

Nondurable–goods manufacturing was the largest contributor to U.S. real GDP by state growth in 2013. This industry increased 5.3% in 2013 after declining 0.5% in 2012. It was the leading contributor to growth in three of the eight BEA regions and in 10 states. Nondurable–goods manufacturing contributed 2.65 percentage points to growth in Louisiana and 1.19 percentage points to growth in Texas.

Real estate and rental and leasing were also a leading contributor to U.S. real GDP by state growth. This industry increased 1.6% in 2013, down slightly from 2.2% in 2012. It contributed to growth in all eight BEA regions and was the leading contributor to growth in the New England region. Real estate and rental and leasing contributed 0.5% or more to growth in North Dakota, Nevada, and Massachusetts.

Agriculture, forestry, fishing, and hunting contributed to real GDP growth in all eight BEA regions and in 49 states and the District of Columbia. It was the largest contributor to the growth of GDP in the Plains region. This industry contributed 1.36 percentage points or more to growth in North Dakota, South Dakota, Iowa, and Nebraska.

POTENTIAL FOR 2014
Looking ahead, GDP growth may also be strong in 2014 for Arkansas. Mark Zandi, chief economist for Moody’s Analytics, also reported Wednesday that U.S. economic growth “looks set to accelerate in the coming months, although significant challenges still remain.”

He said real GDP is tracking near 4% in the second quarter, with some of the strength coming from the rebound in activity from the unusual first quarter winter weather. And while Zandi does not anticipate continued 4% real GDP growth, he said second quarter results suggest “consistently stronger growth in coming quarters.”

However, Zandi also noted that U.S. employment is not keeping pace with GDP growth.

“Although the labor market has improved, unemployment and underemployment remain frustratingly high,” Zandi said in his report. “Job‐market slack is estimated at nearly 2% of the labor force. For context, in the wake of the tech‐bust in 2000, job‐market slack peaked at no more than 1% of the labor force.”

Continuing, Zandi wrote: “The U.S. recovery completes its fifth year this month. This is significant, as the average expansion since World War II has been about as long. But it is also a disappointment, because the economy has yet to experience the rapid growth that has characterized past recoveries.”

Arvest Bank promoted Jennifer Hutchens to branch manager for the Tontitown location. She will report to Jenny England, branch administrator, for Arvest Bank in Springdale.
 
Hutchens has worked for Arvest Bank for more than 12 years, starting first as a teller in 2002, then later as a financial services representative, loan assistant, assistant branch manager and, most recently, as the branch manager of the Scottsdale location in Rogers.

“Jennifer has a strong passion for developing customer and associate relationships,” England said. “Over the past 12 years, she has proven the ability to be patient, flexible and committed to growing Arvest Bank. Customer service is one of Jennifer’s top priorities, so there is no doubt she will fit right in with our Springdale team.” 

A native of Springdale, Hutchens graduated from Springdale High School in 2001.
She and her husband, David Hutchens, live in Lowell and have three children, Brianna, Bailey and Brayden.

Two students from among this year’s GED graduates will receive $1,000 scholarships to continue their studies at NorthWest Arkansas Community College.

This year’s scholarship winners were Jesus Alvarez Garcia of Springdale, who plans to major in industrial engineering, and Adam Foster of Bentonville, who plans to major in culinary arts.

NWACC held its annual Adult Education graduation ceremony on May 17 at the Arend Arts Center in Bentonville. The Adult Education Program celebrated a record year as 566 adults passed the GED test and earned the Arkansas High School Diploma.  One hundred and twenty-two adults participated in the May 17 ceremony.

NWACC awards each GED graduate one free three-hour credit class and selects two students to receive $1,000 scholarships for the coming school year. 

The Gregory Kistler Treatment Center has hired two speech-language pathologists in its Speech Department.

Megan Weaver, speech-language pathologist, joined the Kistler Center after earning a master’s degree from Northeastern State University in May.

Sara Gibson interned at the Kistler Center in the fall of 2013 and spring of 2014.She earned a master’s degree from the University of Central Arkansas in May and then joined the Kistler Center staff as a speech-language pathologist. 

The Kistler center provides rehabilitative services for children in the Fort Smith area regardless of the family's financial means. Parents and family members also receive support from a community environment built around the camaraderie of caregivers, therapists and other families in the same situation. The center offers physical, occupational and speech therapy to children with special needs.

There is never a good time for a high-profile and deadly traffic accident involving a tractor-trailer rig, but efforts by the trucking industry to amend federal hours-of-service rules likely became more difficult when a Wal-Mart rig caused an accident in New Jersey that killed comedian James McNair and critically injured Saturday Night Live alum Tracy Morgan.

Morgan remains in critical condition following the June 7, 1 a.m., accident. Walmart driver Kevin Roper, 35, has been charged on several counts related to the accident. Some media reports suggest that authorities believe Roper was sleep deprived.

Wal-Mart officials have said they will cooperate with the investigation and help the victims.

“Safety is our absolute highest priority, but that is no comfort whatsoever to the families and friends who are suffering today,” Walmart U.S. CEO Bill Simon said in a statement on June 8. “We offer them our deepest condolences. We can’t change what happened, but we will do what’s right for the family of the victim and the survivors in the days and weeks ahead.”

But Wal-Mart is not conceding claims that Roper was driving beyond the legal limits.

“With regards to news reports that suggest Mr. Roper was working for 24 hours, it is our belief that Mr. Roper was operating within the federal hours of service regulations,” said Wal-Mart spokeswoman Brooke Buchanan. “The details are the subject of the ongoing investigation and we are cooperating fully with the appropriate law enforcement agencies. The investigation is ongoing and unfortunately we can’t comment further on the specifics.”

Wal-Mart also declined to provide The City Wire info on changes made within their truck fleet following the accident.

COLLINS’ AMENDMENT
Just days prior to the accident in New Jersey, U.S. Sen. Susan Collins, R-Maine, successfully pushed an amendment through the Senate Appropriations Committee that would block certain provisions – primarily the 34-hour restart rule – of the new hours-of-service rules implemented in July.

In pushing the amendment, Collins said it is “clear that the rules have had unintended consequences that are not in best interest of carriers, shippers and the public.” Collins’ effort would block what is known as the “two-night rest” rule.

Broadly, the Department of Transportation rules reduce a driver’s average maximum allowable hours of work per week from 82 hours to 70 hours, a 15% reduction.

“The 15% reduction in the average maximum allowable hours of work based on the new rule results from the restrictions on the use of the restart period,” explained DOT language on rule.

The DOT estimates that the new rule will boost annual trucking industry expenses by about $470 million, but said benefits from safety, driver health and other factors will produce an overall net economic gain of up to $280 million a year.

“The goal of this rulemaking is to reduce excessively long work hours that increase both the risk of fatigue-related crashes and long-term health problems for drivers,” noted a statement from the federal Department of Transportation.

Officials in the trucking industry have said the rules do nothing to promote safety and instead drive up costs for the industry which are then passed on to consumers.

Kevin Kelly, a spokesman for Collins, took issue with criticism of Collin’s amendment following the accident involving Morgan.

“To infer that the proposal that is being considered by the Senate had anything to do with the horrific crash is inaccurate,” Kelly told the Bangor Daily News in this report.

He added that the amendment would not have changed the fundamental rules that seek to prevent truck drivers from being sleep deprived.

TRUCKING INDUSTRY RESPONSE
American Trucking Associations President and CEO Bill Graves issued a statement following the accident designed to separate the push to amend hours-of-service rules with what happened to Morgan.

“The issue of highway safety, and in particular the safety of the trucking industry, has been at the forefront of the national conversation for several days due to a high profile incident in New Jersey,” Graves noted. “Second, I want to address several issues regarding the hours-of-service rules and driver fatigue generally. The hours-of-service rules – whether they are the current regulations, the pre-2013 rules, or the rules with changes we hope to see as a result of Congressional action – only place limits on driving and on-duty time and require that between work periods drivers take a minimum of 10 consecutive hours off-duty. But they do not dictate what drivers do during that off-duty period. No rule can address what a driver does in his or her off-duty time. The industry – including ATA, our member fleets, our state associations and the millions of safe, professional truck drivers on the road today – strongly believes that drivers must take advantage of their off-duty periods for rest and that drivers should not drive if they are fatigued.”

Chris Spear, the chief of legislative affairs for the American Trucking Associations’, said in a May 14 interview with The City Wire that one consequence of the new rule is that it places drivers on the road at peak times instead of letting them drive at hours when the general public is not on the road. Spear argued that the consequence is counter to the claim of federal regulators that safety is the focus.

The ATA declined to provide comment to The City Wire about how the Morgan accident has changed the hours-of-service debate among federal lawmakers.

Graves’ statement of June 8 also included the following measures the ATA supports to improve highway safety.
• We support a suspension of the controversial and unjustified restrictions on use of the hours-of-service restart provision, which alters driver sleep patterns and puts more trucks on the road during more risky daylight hours.

• We support mandatory use of electronic logging devices to track drivers’ compliance with the hours of service requirements.

• We support more aggressive enforcement of traffic laws to combat distracted and aggressive driving as well as restricting the speeds of large trucks to 65 mph with mandatory electronic speed governors.

• Fatigue, while an important safety issue, is a causal factor in less than 10% of all truck crashes, and ATA believes we need to do far more to address the other 90% of crashes.”

CRASH DATA
Large trucks accounted for 8% of the vehicles in fatal crashes, but only 3% of the vehicles involved in injury crashes and 4% of the vehicles involved in property-damage-only crashes, according to the most recent DOT report on highway safety. The report also found that 39.6% of fatalities are in passenger cars, 37.8% in light trucks and 11.1% from motorcycle accidents.

Graves has been on record saying that the truck driver was not at fault in a majority of accidents between large trucks and other vehicles.

The number killed in accidents involving large trucks during 2012 was 697, up from 640 in 2011, but below historical trends. The average annual number of deaths between 2012 and 2000 was 700.38. Deaths involving large trucks hit a record 1,432 in 1979

Following are the number killed in accidents (2012-2003) involving large trucks.
2012: 697
2011: 640
2010: 530
2009: 499
2008: 682
2007: 805
2006: 805
2005: 804
2004: 766
2003: 726

WAL-MART FLEET SAFETY
Wal-Mart, with the largest private fleet in the U.S., is closely watched when it comes to highway safety legislation and data. The company reports having at least 7,400 drivers, more than 6,100 tractors and 713 million miles driven in 2010 (most recent year the company provided data).

According to the Federal Motor Carrier Safety Administration, Walmart trucks were involved in 375 crashes in the past two years, with nine deaths and 129 injured. The federal data does not indicate who is at fault in the accidents.

The federal data also shows that Wal-Mart had 667.425 million vehicle miles traveled in 2013, among 7,222 drivers and 6,239 trucks.

The Bentonville-based retailer says it has one of the best fleet safety records in the U.S.

“Walmart is recognized by the industry as having one of the safest fleets in the country, driving 2.11 million miles per preventable accident. Walmart is also proud to have a DOT Recordable Accident Frequency of 0.342 per million miles,” the company notes on its website. “Walmart drivers must meet stringent pre-hire standards that include a minimum of 250,000 miles of driving tractor trailers and no preventable accidents in the last three years.”

Few reviews of the move by Springdale-based Tyson Foods to acquire Hillshire Brands for $8.55 billion are favorable. Several analysts say Tyson overbid at $63 per share for Hillshire Brands at the expense of existing Tyson investors, and that the 70% per-share premium could take years for Tyson to recover.

“We believe Tyson stock will be dead money at best for the next 12 months as it copes with the hangover of paying such a big price including an issuance perhaps of $1.6 billion of equity,” noted Robert Moskow, an analyst with Credit Suisse.

Tyson Foods shares (NYSE: TSN) closed at $36.09 on Wednesday (June 11), up two cents. The share price entered June at $42.56, and have fallen more than $7 in response to the bidding war with Pilgrim’s Pride to buy Hillshire. For the past 52 weeks the share price has ranged from a $44.24 high to a $24.74 low.

Moskow was one of two Wall Street analysts to downgrade Tyson stock following the bidding war for Hillshire. Moskow downgraded Tyson from neutral to underperform. BB&T Capital analyst Brett Hundley downgraded Tyson Foods from a buy to a neutral position on Friday (June 6) citing the bids were getting to rich to make the numbers work.

"Bidding wars can sometimes leave casualties, the situation with Hillshire is starting to approach this level," Hundley noted to investors.

He said a bid over $60 by Tyson Foods would run the risk of ruining its investment grade status.

“At the price of $63 per share, we believe Tyson destroyed $2 billion in value. We believe fair value for Hillshire was $47 per share including the $1.3 billion value of synergies,” Moskow said.

Standard & Poor’s put Tyson Foods on credit watch with negative implications following its winning bid for Hillshire Brands because Tyson will assume more debt to finance the high-priced deal.

Tyson now has investment grade credit, two full levels above junk status, but analysts believe the meat giant could teeter on the edge of more downgrades if commodity price increases crimp margins and cash flow needed for debt repayment.

Officials with Tyson Foods say they are prepared to issue debt and equity to cover the purchase but will not sacrifice the investment grade credit rating. Fitch Rating noted Monday (June 10) that a new equity issue is the most favorable option for the company. Tyson’s ratings will take into consideration the equity used to finance the purchase as well as Fitch’s view regarding the pace of reducing debt and Tyson’s ability to garner its projected $300 million in savings

Tyson filed papers June 9 with the Securities and Exchange Commission outlining an extension of a bridge loan for $8.2 billion with a $1 billion “backstop” agreement to cover any contingencies.

BIG APPETITE
Analysts drilled Tyson executives earlier this week about why the bidding went so high for Hillshire Brands. Tyson management said Hillshire is a once-in-a-lifetime deal that will help moderate the volatility of the core commodity business, accelerate its growth rate, improve the value-added mix while also creating operational synergies – improved margins – over time.

Tyson Foods CEO Donnie Smith said culturally the companies are also a great fit and the deal will pay off for shareholders over the next five years. That timeline was extended from three years to five years after Tyson raised its offer for Hillshire from $50 to $63 per share, which made it the most expensive meat deal in industry history.

Stephens Inc. analyst Farha Aslam told Bloomberg Radio this week that growth among U.S. food companies is hard to achieve because Americans are spending about all they are able on food. She said the food industry is seeing several consolidations because interest rates are low and food companies generate lots of cash.

“Hillshire is a strategic fit for Tyson Foods, the largest acquisition in Tyson’s history and it will take some time for them to digest it all.” Aslam said.

Tyson believes adding HIllshire to its portfolio would create a larger market share in the breakfast category the fastest growing segment in food. Tyson said there is also more room to expand margins on Hillshire’s business –  assumption to which Moskow agreed.

ASSET SALES
Moskow said Hillshire presents opportunities for Tyson to generate cash for debt paydown. For example, Credit Suisse believes Tyson will sell off Hillshire’s bakery division which generates about $500 million in annual sales. However, Moskow said it would still be a drop in the bucket given the overpayment for the Hillshire business.

Tyson Foods could also adjust capital expenditures to reduce spending, namely in China, where they have also slowed expansion.

Tyson also just completed the sale of its 50% interest in Dynamic Fuels to Renewable Energy Group. The renewable fuel plant in Geismar, La., was a costly venture for Tyson and partner Syntroleum since the project came online in 2010.

REG paid Tyson approximately $16.5 million in cash at closing on June 9 and retired approximately $13.5 million of Dynamic Fuels’ indebtedness to Tyson, according to a company release. REG has also agreed to make up to $35 million in future payments to Tyson tied to product volumes at the Geismar biorefinery over a period of up to 11.5 years.

Gigantic screen televisions are fun to look at in a store, but on a space-to-sales ratio they rank well below tablets and mobile phones. That is why consumers can expect to see fewer big screens in their local Walmart Supercenter in the future and more space dedicated to faster-selling mobile phones, tablets and other digital accessories.

“Electronics are a great piece of business for us, albeit a challenging category for some time now,” Bill Simon CEO of Wal-Mart U.S., said during the recent question and answer session with the media in conjunction to the retailer’s shareholder events (June 3-6).

Simon was asked how the retailer is managing its entertainment category, which remains challenged because of deflationary margins and slowed innovation. While Simon admits the ongoing challenges, the retailer is not making radical changes. They are actively tweaking the space dedicated to certain entertainment items.

“We are trying to look at this segment more holistically. Forget online and offline and think more about assortment offering and connectivity. There are certain items we can show in the store, that we could sell more breadth of online and there are other items that we can sell and deliver immediately to the customer in-store,” Simon said.

Stephen Quinn, executive vice president of marketing at Walmart U.S., said the retailer is launching net modular sets within its electronics and entertainment departments. These sets have already been placed inside local supercenters in Northwest Arkansas.

“One of the most vital things we do is make sure our in-store presentations fit customer needs. Electronics are a challenging industry,” Quinn said. “The new sets in our local stores adjust our space-to-sales ratio better and we are leaning in toward the growth areas.”

CHANGING THE MIX, PRESENTATION
Wal-Mart said wireless devices, tablets and mobile connectivity items will have more dominant presentation space in its stores. The space also will include bigger brand presentations, and newer and more popular brands. Those brands will be featured in more prominent store locations to better ensure customer awareness.

“We are looking at the physical space dedicated to the electronics and we see there are some items in the category growing twice as fast as those items in decline, so we are making sure the product mix and assortment is right for what customers want. We are also working closely with our partners at Walmart.com to try and figure out what is the best way to present our online offerings to the customer when they are in-store,” Quinn said.

Simon said the dedicated space for entertainment in a supercenter is not changing, but they are adjusting the product displays within that dedicated area. He said there is still value in the $5 DVD and music CD bins as the retailers sells a ton of those items each week.

“Overall it’s a difficult, challenging business, but we feel good about the share position we are in and we are going to try and build upon that share going forward,” Quinn said.

Jason Long, CEO of Shift Marketing Group, said in many ways Wal-Mart is a victim of its own success in the electronics space and now they are victims of the latest, greatest thing.

“There was a time when Wal-Mart was not competitive in electronics, but they began to pull in the best brands and broad selections with better pricing than other competitors, taking market share. But how many big screen televisions do families really need. The lack of innovation from Apple and everyone else has stagnated this category,” Long said.

He said giving top brands more prominence in the store is like a hybrid version of the store-within-a-store format that has been popular at Best Buy. 

One area Long believes Wal-Mart could step up its game is through theme displays around some pop culture phenomenons like “Frozen” or “Star Wars,” especially if there is more room to spare. 

“At Target, ‘Frozen’ outsold in a month more copies than ‘Finding Nemo’ sold in a full year. They said the soundtrack from ‘Frozen’ outsold all other CDs in total in that month. You would have to think this kind of popularity would be a huge traffic driver in stores,” Long said.

SELLING SERVICES, APPLIANCES
In the past Wal-Mart looked to sell services to help boost entertainment sales. One of the more recent programs is a game trade-in service. It has been mildly successful with 115,000 games traded in for cash at Walmart stores, according to Duncan Mac Naughton, chief merchandising officer for Walmart U.S.

Wal-Mart said there were roughly 880 million video games sitting in homes collecting dust, when the program was announced. This buy-back program is designed to get traffic in-stores trading and then spending the money paid on new games or upgraded video gaming equipment. The refurbished games are slated to make their way to Wal-Mart shelves this summer.

Mac Naughton said new game releases drive heavy traffic into the store, and the buyback program will allow more gamers to trade-up over time and increase the overall size of the $2 billion market. Other retailers like Radio Shack recently announced new services as a way to drive traffic into their electronics stores. Dallas-based Radio Shack unveiled a new smartphone “fix it” service last week in its stores. The in-store, same-day service on popular mobile devices is performed at “Fix It Here” stations while the customer waits. Radio Shack has added stations to more than 284 company and franchise stores as part of a pilot program. Results are encouraging enough to expand it to 700 stores by year-end, said CEO Joe Magnacca.

Long said he is not sure how many people go to Radio Shack to buy their smartphones and service plans. But they do sell phones and if the repair job costs more than a new phone, Radio Shack will likely sell more of them.

“You have to figure that some Radio Shack sales people already possess the know-how to repair electronics. I am not sure that could be said for other mass retailers,” Long said.

Simon also set the record straight about selling household appliances within a supercenter setting. He said Wal-Mart piloted selling appliances in a number of markets, including Texas, in recent years. He said sales were good in certain locations but the process of selling appliances is not scalable.

“Our business model requires frequency in turns for items to be productive and effective and while white goods (appliances) sales where effective in a few locations, we have decided to evaluate now how we might sell these items online and deliver to store,” Simon said.

Tyson Foods was recently cited for a wastewater violation from the Missouri Department of Natural Resources (DNR) in connection with a fish kill caused by improper disposal of a feed additive.

DNR also cited the city of Monett, Mo., for failing "to operate and maintain facilities to comply with the Missouri Clean Water Law and applicable permit conditions", according to a separate violation notice from state authorities.

Tyson received a shipment of wastewater containing Alimet, which is a liquid animal feed supplement, from another company facility in Aurora, Mo. Tyson sent the wastewater to its pre-treatment facility and later discharged the water to the city of Monett's sewer system.

The state agency said the discharge caused operational problems at the city's wastewater treatment facility. A fish kill occurred along a six-mile stretch of Clear Creek when the Monett Municipal Wastewater Treatment Facility discharged the water into a tributary of Clear Creek.

DNR said its investigation and sample results from Tyson’s plant in Monett and the city’s wastewater treatment facility leads to a reasonable certainty that the discharge came from Tyson to the city. The DNR added that the agency is conducting a hazardous waste investigation to determine whether additional violations occurred.

"We’re working cooperatively with city and state officials as they investigate this matter," Tyson Foods noted in a statement. "Like most people, we’re very concerned about water quality and its impact on the surrounding environment. Water is a critical natural resource and we work to protect it at all of our locations. We’re awaiting additional discussions with the state and city so we can understand how our operations potentially played a role in what happened.

"Many of our team members and their families live in the community, so when it’s affected, we’re all affected. We hope to have a conversation with Missouri Department of Natural Resources about what we can do to assist with improvements of the creek. We have a long history of mutually productive cooperation with the City of Monett and we hope that will continue as we work through this process."

Shannon Newton was named as the new president of the Arkansas Trucking Association (ATA) replacing long-time leader Lane Kidd, who resigned earlier this year.

Newton has been with the ATA since 2003 and has served as vice-president of the organization since 2008. She will assume her duties immediately.

“When we began our search for a new president, we knew that an experienced leader with deep industry knowledge and a broad skill set was exactly what we needed,” said Craig Harper, ATA Chairman of the Board and EVP/COO of J.B. Hunt Transport, Inc. “Shannon is a dynamic leader and extremely knowledgeable on the complex issues faced by our members. The board was unanimous in this appointment. She became the clear choice to lead the Arkansas Trucking Association forward.”

Today, the Arkansas Trucking Association represents about 300 trucking companies, private carrier fleets and industry suppliers.  The transportation industry is responsible for around 86,000 direct jobs.

“I am honored and humbled to have been chosen to lead the ATA,” said Newton. “The Arkansas trucking industry is a recognized national leader. My years with the association, working on behalf of this great industry, the member companies and the thousands of dedicated, professional men and women, in the cab and out, have been so rewarding. I welcome the opportunity as president to continue to work with the ATA’s extraordinary and dedicated staff and with these extraordinary members to help drive our industry’s growth.”

Since joining ATA, Newton has filled a range of leadership roles with expanded responsibilities in the development and implementation of strategic initiatives across core areas including Planning, Finance, Member Services, Governance, Regulatory and Legislative Affairs and Advocacy.

She has had held a number of association and national industry leadership positions and serves as chair of the Trucking Association’s Insurance Council.

The top two executives at Bentonville-based America’s Car-Mart did without bonuses and incentive performance pay in fiscal 2014 to the tune of $126,338 for CEO Hank Henderson and $76,749 for chief financial officer Jeff Williams, according to a recent proxy filing with federal regulators.

Henderson earned a total of $467,859 last year, which included car usage, country club membership, insurance premiums and matching retirement funds. The base salary of $440,000 was unchanged from fiscal 2013, and there was no performance bonus pay.

Williams’ total income in fiscal 2014 was $373,268, comprised on a base salary totaling $346,500. The base salary increased 5% from the prior year and other compensation for car usage and retirement funding decreased 14% from the prior year.

Former chief operating office Eddie Hight, who stepped back from that role in November, earned a total of $309,491 in fiscal 2014. Hight did receive a $10,000 bonus and he now serves as associate development manager and a board member.

ANNUAL MEETING
Car-Mart plans to hold its annual shareholder meeting at its corporate offices in Bentonville on July 30. The business agenda will include the election of seven directors to a one year term. Board candidates are:
• Daniel Englander, 47, managing partner with Ursula Investors;
• Kenny Gunderman, 43, executive vice president with Stephens Inc.;
• Hank Henderson, 50, CEO at Car-Mart;
• Eddie Hight, 51, associate development manager at Car-Mart;
• John David SImmons, 78, president of Simmons & Associates;
• Cameron Smith, 63, CEO of Cameron Smith & Associates; and
• Jeff Williams, 51, chief financial officer at Car-Mart.

Independent directors earn $40,000 base annual retainer for their services, stipends of $5,000 and $10,000 are paid to the lead director (Simmons) and the chairman of the audit committee (Englander), respectively. Each director also receives stock option awards which were valued at $96,435 last year.

In related party transactions last year Car-Mart states that on Dec. 12,  it repurchased 100,000 shares for one of its directors, William Sams, for $4.101 million, and 100,000 shares from the Marlin Sams Fund, in which William Sams was a general partner. That purchase was also valued at $4.101 million. The company notes the repurchased price paid was determined according to the conditions of Rule 10b-19 under the Exchange act. 

For the fiscal year ending April 30, 2014, Car-Mart says it had no other related-party transactions.

INVESTOR RIDE
Car-Mart investors have had a bumpy ride this past year with the share price losing 13.6% of its value over the past 52-week period. Shares traded down 1.5% on Thursday (June 12) at $36.28. The bulk of that decline occurred following the recent earnings miss reported May 28. That one day shares sunk 12.4%, or $5.03, to $35.50.

The buy-here, pay-here used-car company reported fiscal year net income of $21.1 million, down 34% compared to the previous fiscal year. Total revenue rose 5.3% to $489 million, despite slightly negative same-store sales for the year. The company sold and financed 42,551 cars and trucks in fiscal 2014, up 4.4% more than in the prior year. The average sales price rose less than 1% to $9,768. 

Shares rallied to $40.53 ahead of the May 27 earnings report, but retreated immediately following the disappointing financial report. Fiscal year income was $2.25 per share, which missed the consensus estimate of $2.31. The company was also estimated to earn $499.97 million, which was below the reported $489 million.

CORPORATE GAME PLAN
Henderson was upbeat in the earnings call in part because of the company’s clean balance sheet. He did say the company would slow its expansion pace this year from earlier projections as it works to improve sagging sales in many of its dealerships.

The sluggish sales growth has been attributed to an onslaught on competition in the subprime auto finance sector as more lenders are chasing the higher yields. Car-Mart charges 15% on its car loans, and says the rate is justified because of the risk involved lending to consumers with very low credit scores.

Part of the reason Car-Mart’s total results slid was because the company experienced a higher-than-normal rate of repossessions and delinquencies brought on by consumers taking their Car-Mart purchases back to the dealership and then going with another lender offering a better interest rate.

Henderson said Car-Mart has been in the business long enough to know what it takes to make a deal work and that’s the plan they are sticking with despite the competition.
Car-Mart seeks to keep the terms below 36 months (29 months on average) in order for the customer have build quicker equity in their purchase. 

The automobiles sold by Car-Mart have between 90,000 and 140,000 miles and range in age from six to 10 years old with an average wholesale price between $3,000 and $7,000. Given these metrics, Car-Mart said it believes the 36 month term is as long as it can go, and believes the business model has served the company well for the past three decades as nearly 20% of its new business comes from referrals. 

WIlliams said stretching the term longer like some competitors allows for lower monthly payments which look good on the front-end but leave the borrower with little to no equity for a long time.

Car-Mart’s core mission involves getting repeat business, which it does largely because its customers get their vehicles paid for much sooner while there is still life left in the car.

The largest deal in meat history — Tyson Foods’s $8.55 billion offer to acquire HIllshire Brands — may soon reach the Hillshire board for approval, according to persons close to the situation. But execs with Pinnacle Foods could delay the mega deal.

Tyson Foods offered to pay $63 per share for Hillshire Brands and cover the $163 million break-up fee to Pinnacle Foods, if Hillshire walked away from its plans to buy Pinnacle Foods — a $4.3 billion deal announced May 12.

Pinnacle Foods said Thursday (June 12) that it is considering its options to hold Hillshire Brands to its agreement or secure more money in exchange for the deal termination.

Hillshire privately notified Pinnacle earlier this week that it doesn't plan to recommend the Pinnacle acquisition to its shareholders.

“Now, any arguments about its rights under its agreement with Hillshire could ultimately be pursued as leverage in a settlement,” according to a Wall Street Journal report.

Market watchers have said the Tyson bid was overvalued. Tyson execs counter by saying that acquiring Hillshire’s retail brand share was an opportunity of a lifetime. The pro forma company would take a major share in the breakfast foods market and rise to No. 2 in the frozen foods categories, behind Nestle, according to Tyson projections.

Hillshire Brands has not formally accepted Tyson’s deal, which was contingent on the break-up with Pinnacle. Analysts said the notification to Pinnacle this week sets the ball in motion for Hillshire to now fully consider Tyson’s generous offer, which represents a 70% premium price for its investors.

Pinnacle claims the merger agreement has a “force the vote” provision which requires Hillshire to hold a shareholder vote on the Pinnacle deal. Only if Hillshire shareholders reject the deal, can Hillshire terminate the agreement. 

Hillshire’s language in the June 9 release that acknowledged Tyson’s offer indicated the sausage maker understood that it had no right to entertain Tyson’s offer because of is agreement with Pinnacle Foods. Under the terms of the Pinnacle-Hillshire agreement, there is a clause that would allow both parties to work toward an amicable termination, with Pinnacle receiving the $163 million break up fee from Hillshire, who would then be able to negotiate the acceptance of the Tyson deal.

Analysts believe Hillshire shareholders would approve the Tyson deal as it represents a substantial cash premium over all other offers. Tyson extended its offer deadline to Dec. 12,  giving Hillshire time to work through its options. 

Shares of Hillshire Brands (NYSE: HSH) closed Thursday at $61.87, down 4 cents. Shares recently set a 52-week high of $62.04 on news of the Tyson offer. Tyson investors have not fared so well. Tyson shares (NYSE: TSN) closed Thursday at $35.17, down 92 cents. Tyson shares have decreased in value more than 13% in the past five trading days.

Tyson Foods CEO Donnie Smith said culturally and operationally the companies are a great fit and the deal will pay off for shareholders over the next five years. That timeline was extended from three years to five years after Tyson raised its offer for Hillshire from $50 to $63 per share.