In a not-so-surprising move by the California State Supreme Court, the court has said that cities and towns have every right to set up ordinances to block big-box stores from being built in California communities that want to keep the megastores out of their collective backyards. This court decision stems from the recent Turlock situation -- those folks were successful in not allowing Wal-Mart to set up shop in their neighborhood.
So, with the Appeals Court in Fresno setting a statewide precedent, that court recently said local governments can enact such big-box restrictions to prevent the collapse of local businesses and resulting urban blight. Hence, communities can enact ordinances that effectively band large megastores for this very reason.
Wal-Mart just can't seem to find a pinch of luck in entering the California market in a large way at all. The communities, citizens and courts there seem to be sending a very strong message to Wal-Mart and other megastores like SuperTarget -- they do not want large, big-box retailers there at all -- regardless of "lower prices" or enhanced competition. With WMT shares needing growth -- fueled in part by more store openings -- what is a WMT investor to do?
Last updated: May 16, 2012: 07:13 PM
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Reader Comments (Page 1 of 1)
7-17-2006 @ 11:03AM
lee gillette said...
Good for CA!
7-17-2006 @ 11:04AM
Bill Berger said...
Since the California Supreme Court has ruled Walmart cannot open their "Big Box" stores, what other type of business can the communities refuse?
Maybe anytype that the community leaders have an interest in? They can now write an ordinance to cover anything they want. This should get interesting since the way this ruling is stated, the public good is not to be considered. Only the action of the people that are currently ruling.
7-17-2006 @ 1:36PM
Pier Johnson said...
The salient aspect of foreign-based (out-of-state) retailers never debated or reported is after a retailer like Wal-Mart pays retail-level wages, all profits get exported to Bentonville, Arkansas or in the case of Home Depot, to Atlanta, Georgia.
The higher paid executives and contractors based locally to the headquarters of these enterprises are the ones that receive the lion's share of profits.
These profits circulate in the local region of the headquarters making those persons richer at the expense of those persons buying the "imported" products of the foreign-based (out-of-state) big-box retailer.
California must change its rules to encourage corporate enterprises to choose California as the home for their headquarters, keeping profits within the state.
7-17-2006 @ 8:39PM
David Michael said...
Pier,
You have to be kidding me!!
Who would want to do business in the People's Republic of California? It is the worst state in the Union to try to conduct business in.
It appears to me they are changing their rules to discourage corporate enterprises from choosing California. Too many laws are not a good thing, and this latest one is just the tip of the iceberg.
7-17-2006 @ 11:35PM
Warren Ogren said...
In my home town of Hayward, WI, since the mega store of Wal-Mart was built about three years ago, every store that handles the same merchandise as Wal-Mart (including groceries) is on the verge of closing down, or is struggling to keep open.
They pay at the minumum wage scale, and refuse to allow unions as I understand.
Warren Ogren
10036 N Ogren Road
Hayward, WI 54843
warogren@cheqnet.net
7-18-2006 @ 12:18AM
Warren Ogren said...
5.
In my home town of Hayward, WI, since the mega store of Wal-Mart was built about three years ago, every store that handles the same merchandise as Wal-Mart (including groceries) is on the verge of closing down, or is struggling to keep open.
They pay at the minumum wage scale, and refuse to allow unions as I understand.
7-18-2006 @ 3:28AM
Jan Nanning said...
The conflicts between consumer and investor seems to be becoming a much more frequent problem and is worsened by the fact that today, with the much greater and easier access to the investment markets, that the consumer and investor are often one in the same.
As investors we want the growth and higher earnings and then as consumers we complain when the company moves into our neighborhood or moves its production overseas to investor demands. The consuming investor can't have it both ways.
WalMart and the mega stores don't destroy the local surrounding business communities...that destruction comes from local people who stop shopping at non-competative local stores so that they can save a few bucks on their groceries and other items. Many of these local shopping communities were already doomed by the incursion of nearby malls that provide entertainment, restaurants and become destinations drawing people away from the local mom-pop retailers.
7-18-2006 @ 1:00PM
Lobo said...
The title is misleading. Communities have the right to control size, appearance and any number of other characteristics, but current prececent would prevent a community from banning a corproation based on who owns it -- a result of the legal doctrine of "corporate personhood."
7-18-2006 @ 2:52PM
rebecca boling said...
kudos to cali !! finally a state in our union with the integrity to allow the people to decide what is or isn't going to reside and contribute to thier individual neighborhoods and towns !! it is a fact folks, that walmart is destructive to the american dream and the american standard of living.
this country really needs to get it's head out of it's ass and other states need to do whats right by the american people such as california has done.