By  on May 18, 2005

CHICAGO — Wal-Mart president and chief executive officer Lee Scott, taking on critics of the world's largest retailer, said here Tuesday that Wal-Mart provides value to consumers who need it most.

Twenty percent of Wal-Mart customers fall into the category of people who don't have bank accounts — and they need inexpensive goods, Scott said. It "bothers" him when groups align against Wal-Mart in the name of saving union jobs.

"We democratize merchandise...don't kid yourself, it's not going to stop at Wal-Mart," Scott said. "Target is a darn good company, so if you are going to stop Wal-Mart from sharing value with customers, you better stop Target, and then you better get to Aldi, and Dollar General."

Wal-Mart has come under fire from critics who charge it doesn't provide employees with adequate wages and benefits. In addition, the firm has faced opposition to its expansion plans in cities such as New York and Chicago. The retailer has embarked on a campaign to tell its side of the story to the public.

Scott spoke at the annual meeting of the Executives' Club of Chicago, a 91-year-old business forum for corporate and civic leaders. The session was at the Hyatt Regency.

After speaking for about 10 minutes, Scott took questions, which ranged from expansion in China to supply chain initiatives to coping with corporate misconduct.

Wal-Mart is opening a store in Beijing this week and has plans for 12 to 14 openings in China this year, Scott said.

"They hold us to a higher standard of sanitation, a higher standard of employment because they want somebody to set modern standards in that country," he said.

Asked about human rights violations in China, Scott said factories all around the world, including the U.S., are at risk. "There are people willing to cheat," he said. "And don't give me this crud that the reason they have to cheat is because you [Wal-Mart] get too good a price. That's not true. The reason people cheat is because some people cheat."

One of Wal-Mart's newer supply chain initiatives involves a process called "Remix," he said. The distribution process involves mixing product such as grocery, hardlines and apparel together, based on speed of movement and other factors, to serve stores more frequently.Next year, Wal-Mart plans to open its first Chicago store in a West Side neighborhood, where the average household income is about $43,000, he said. Scott said this store will help keep sales dollars in Chicago, where the public transit system is having financial troubles. Data collected and analyzed by Wal-Mart indicates that in the past year, $526.3 million was spent by Chicago residents shopping Wal-Mart stores located in the suburbs.

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