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Sunday, August 11, 2013

Like Costco, this grocery store chain has lower prices and better benefits than Walmart

[Gazette Blog Editor's note: In our ongoing quest to discourage consumers from shopping at Walmart, we offer the following post.  You may not have a WinCo in your area, but chances are you have a Costco.  We do not have to support a chain like Walmart, whose employees subsidize low prices with meager pay and few benefits.]

By Bryce Covert
Think Progress/News Report
nationofchange.org

WinCo, a small, employee-owned grocery store chain based in Boise, Idaho, is able to beat Walmart’s prices on goods while providing its employees with good benefits.

The company, which will soon have close to 100 stores with the latest openings in Texas, has almost 15,000 employees. Those who work at the store long enough qualify for a pension plan into which the company puts an amount equal to 20 percent of their yearly pay. More than 400 “front-line” workers — clerks, cashiers, and others who are not at the executive level — have retirement accounts that are worth at least $1 million, according to a company spokesman.

It also provides full health benefits for those who work at least 24 hours a week, beyond the requirements in the Affordable Care Act. While the company is private and hasn’t made wage information available, Glassdoor reports that cashiers and clerks make more than $11 an hour. Thanks to these benefits and wages, the company has low turnover. An industry analyst estimated that the average hourly worker stays with the company for more than eight years.

The same level workers can expect $8 an hour at Walmart and part-time workers won’t get health care coverage. Even half of full-time workers aren’t covered because the costs are so high. Thanks to its low pay and few benefits, workers rely on $1 million worth of public benefits in a single store just to get by. 

Yet WinCo’s prices are often lower than Walmart’s. To drive them down, the company doesn’t rely on distributors to get products and instead sends its own trucks to get food and other goods in bulk, which can amount to a 10 to 50 percent discount. It requires that customers bag their own groceries to cut down on the cost of a worker doing it for them. It doesn’t take credit cards to eliminate the processing fees. And its stands and displays are “pragmatic” and “lack frills.”

Other rivals are also able to offer cheap goods and good working conditions. Costco, which competes with Walmart’s Sam’s Club, pays employees $21.96 on average and nearly all of the workers who are eligible for benefits are enrolled. Its bottom line is strong, with profits up 19 percent in the first quarter of the year. It also gets much more revenue and profit per employee and generates a higher return for investors than Walmart.

Meanwhile, Walmart’s sales have been hurt by its inability to keep shelves stocked and offer good customer service. That’s because it doesn’t hire enough employees to get product on the floor and workers with such low wages and hours aren’t offering a good customer experience. The company ranked at the bottom of the American Customer Satisfaction Index in February.

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