Wal-Mart workers want discount on food

After successfully lobbying Wal-Mart to raise wages, workers have a new demand: Give employees a discount on food. For the world’s largest retailer, that could cost more than $400 million.

Wal-Mart currently offers workers a 10 percent discount on all merchandise except the vast majority of food. Fruits, vegetables and some snacks are the only food items included in the promotion, unless they’re on sale. Employees want more groceries to be included in the discount, noting that competitors such as Target and Whole Foods Market already offer that perk.

“It is ridiculous,” said Janet Sparks, a Wal-Mart employee in Baker, La., who has been active in labor groups pushing for higher wages. “You can get a 10 percent discount on cat food, but if I buy tuna or chicken, I get no discount.”

A group of Wal-Mart workers started an online petition last week calling on the company to expand the discount, and it has received 12,600 signatures from employees. The group, which isn’t affiliated with a separate organization financially backed by the United Food and Commercial Workers International union, plans to take the petition to store managers and executives this month.

For a company of Wal-Mart’s size, a seemingly small benefit can add up quickly. The 10 percent discount would be spread out over 1.4 million U.S. employees, more than the population of San Diego.

The average U.S. household with an annual income above $20,000 spends more than $3,000 a year on food at home, according to the Bureau of Labor Statistics. If all Wal-Mart employees took advantage of the proposed benefit and purchased their groceries at work, it could cost the retailer more than $420 million a year in discounts. And that’s in a category with already thin margins. The supermarket industry has a profit margin of 1.7 percent, according to research firm IBISWorld.

Wal-Mart, which had more than $16 billion in profit last year, declined to say how much the additional discount would cost. Spokesman Kory Lundberg said the retail giant offered $500 million in discounts last year on general merchandise, fruits and vegetables.

While a food discount has been mentioned by workers, higher wages, better scheduling and more regular hours were a bigger priority for the Bentonville, Ark.-based company, Lundberg said.

“Wal-Mart is investing $2.7 billion in its associates this year and next in higher wages, better training and more scheduling control,” he said. “In addition to offering quarterly cash bonuses to hourly associates, Wal-Mart also offers a 401(k) program with a 6 percent company match. We think these benefits, along with some of the highest starting wages in the industry, makes Wal-Mart a very competitive employer for top talent in the retail industry.”

Wal-Mart shares declined $1.10 Wednesday, closing at $57.58 on the New York Stock Exchange.

This story was originally published November 11, 2015 at 4:37 PM with the headline "Wal-Mart workers want discount on food."