Wal-Mart Competition

Knight Ridder News

NEBRASKA CITY - From the wooden aisles of his 51-year-old hardware store downtown, Walt Wenzl calls Wal-Mart a greedy corporation that mainly sells foreign-made products.

"As long as the good Lord is willing, I'll be here," said Wenzl, 77. "To hell with Wal-Mart."

Yet others in this river town of 7,228 say they welcome the building of a Wal-Mart Supercenter here. They say it may provide better paying jobs and keep shoppers from traveling elsewhere.

"I won't have to drive to Omaha," said Lori Stipe, a convenience store clerk who also plans to check out Wal-Mart job prospects.

The Great Wal-Mart Debate: It's coming to a small town near you.

After opening Supercenters in or near all but one of Nebraska's 20 largest cities, the company that was born in a small town in Arkansas appears to be returning to its roots.

Besides Nebraska City, Wal-Mart is seeking to build a Supercenter 24 miles north in Plattsmouth, population 6,893. Wal-Mart recently broke ground in South Sioux City, population 11,925, and plans a Supercenter in Fairbury, population 4,262, to replace its first outlet in the state - a discount center built 23 years ago.

Wal-Mart's aggressive expansion plans prompt debate in communitiesacross the country.

Some fear that the world's largest retailer will methodically drive small operators out of business, depress wages and devastate local main streets.

Others, however, see a company bringing sorely needed jobs with benefits. Wal-Mart says its average hourly wage approaches $10.

There also is a practical reason for Wal-Mart's renewed emphasis on small towns - the company has found it difficult to enter big-city markets, where planning and zoning regulations can be hard to overcome, according to Burt Flickinger III of New York, a retail consultant who advises Wal-Mart competitors.

A company spokesman said there is "no particular grand strategy" to its move into smaller towns.

"We are constantly evaluating locations across the country so we can serve our customers better or reach new customers," said Ryan Horn, an Omaha native who is the company's community affairs manager in several Midlands states.

"We're just looking closely at Nebraska right now, and you're seeing the results."

In the past two years, since opening a distribution center at North Platte, Wal-Mart has opened 11 new Supercenters, which include groceries, in the state and has six more under way. Southwest Iowa, meanwhile, has seen two new Supercenters in the past year: at Creston and Atlantic. The border towns of Yankton, S.D., Vermillion, S.D., and Marysville, Kan., also have new Supercenters.

When the Nebraska distribution center opened, officials said it could supply 35 stores within 250 miles. Horn said the center has plenty of capacity for more.

Those kinds of numbers have fueled talk of Wal-Mart coming to several towns.

In Holdrege, the executive director of the Chamber of Commerce got a shock when she received a drawing of where a new Wal-Mart could be built in the south-central town of 5,636.

"No one knew where it came from, or if they're even going to build a store," said Kara Mueller. "But the rumors were circulating around town."

In O'Neill, population 3,733, chamber executive Pat Fritz said speculation there is so strong that it's made some other businesses think twice about locating there. "We hope that whatever is going to happen, they say 'yes' or 'no' so we know," she said.

Officials of several chambers said Wal-Mart probably would be welcomed by residents because they want their towns to grow and to keep shoppers at home.

"I know we want one," saidCarrie Walker of the Ogallala Chamber of Commerce. "Our nearest one is 50 miles away."

Nebraska City residents voiced mixed feelings when Wal-Mart said it was coming.

Known for outlet stores, Arbor Lodge and the Lied Conference Center, Nebraska City has already seen a migration of merchants to the freeway that skirts the town's south and west edges.

Wenzl, whose traditional hardware store sells hefty wrenches, cast-iron skillets and bills itself as "Your Radio Flyer Headquarters," has remained downtown along the brick Central Avenue. He emphasizes personal service and American-made products.

Wenzl said he's saddened by Wal-Mart's impending arrival and wonders how many stores the company needs to build. There's already a Wal-Mart 32 miles to the east in Shenandoah, Iowa, one 35 miles north in Bellevue and another about 45 miles to the west in Lincoln.

Horn, of Wal-Mart, said his company wouldn't be coming if customers didn't want it.

He said Wal-Mart found that shoppers from the Plattsmouth area did $18 million of business annually at the Bellevue Supercenter. Horn said enough Nebraska City residents shopped at Bellevue and Lincoln stores to convince the company that a Supercenter was needed at Nebraska City. That will help shops like Wenzl Hardware, he said.

"No one's going to shop in his store if they're up in Bellevue."

Across the road from Wal-Mart's planned Nebraska City location sits Norman's IGA, one of the town's two grocery stores - businesses that usually take the biggest hit from a Supercenter.

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