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Wal-Mart’s New Headquarters: Tradition, Not FrillsLock Icon

6 min read

Wal-Mart Stores Inc. says its new headquarters campus on 350 acres in Bentonville will be all about efficiency and not ego.

The retail giant announced last month that it plans to relocate its home office from its location on Eighth Street to a property on J Street between Central Avenue and Highway 102. CEO Doug McMillon said the current setup has resulted in a “patchwork” of 20 facilities spread out across the city and beyond because the company has outgrown the main office complex, which dates to 1970.

Editor’s Note
This is the latest in a series of business history feature stories. Suggestions for future Fifth Monday articles are welcome. Please contact Gwen Moritz at GMoritz@ABPG.com.

Wal-Mart didn’t announce many specifics about the plans for the new home base, and an architect and a contractor haven’t been selected. The company said it won’t even know how much the new campus will cost until the plans are finalized.

“For some time now, we’ve been concerned that this ad hoc office network actually inhibits our ability to compete in the rapidly changing retail landscape,” McMillon said in the original announcement. “We need to be curious, collaborative, agile and accountable if we are to win in the future. We need a workplace that fosters those skills and traits.”

The big news about the headquarters was McMillon’s promise that it would have lots of natural light, a welcome change for many who have worked in Wal-Mart’s drab, aging buildings, especially the home office. Company spokesman Randy Hargrove said the current Wal-Mart buildings in the city cost millions of dollars in maintenance and upkeep and are hardly considered recruiting tools for today’s most promising corporate job candidates.

The fact that Wal-Mart corporate employees are spread throughout the city also complicates the collaborative work environment the company wants.

“Retail is continuing to transform quickly, and we think the new facilities we will build will accelerate change,” Hargrove said. “It’s going to accommodate a digitally native workforce and encourage more collaboration and speed. It is going to help us get the most out of our existing teams and help us attract that next generation of talent that we need. One of the things we also said, [is] when you get into the new properties you’ll see improved parking, meal services, fitness and natural light. If you’ve been in our current home office you’ll know what I’m talking about.”

Humble Beginnings
Much has been made of Wal-Mart founder Sam Walton’s humble, thrifty ways, from driving the same pickup truck for years to thinking carpet was a wasteful office expense. His first office, after moving to Bentonville in 1950, was in the building of the 5&10 store he purchased on the downtown square.

The property is now the site of The Walmart Museum, which houses, among other exhibits, Walton’s office as he used it.

As Wal-Mart grew in those early years, Walton understood the home office needed to expand too, so he moved first to what is now Tusk & Trotter on SE A Street on the downtown square and later to a second-floor office also on the square. In 1970, the 158,000-SF home office was built on Eighth Street. As the company continued to grow, the home office was expanded or other facilities were incorporated into the headquarters campus.

“If you look at photos over the lifetime of Wal-Mart you see it grow,” said Alan Dranow, the senior director of Walmart Heritage Group, which manages the museum. “The growth of the home office is really a very good [reflection] for the growth of the company. That is how we are able to achieve ‘everyday low prices’ because we have never really spent a lot of money on our offices. The furnishings are not fancy. They’re very functional. They get the job done.

“As we come into a new era of hypercompetitiveness with other companies on the internet and companies that are creating the bridge between the internet and brick-and-mortar stores, you’re going to see a great efficiency in how we approach the new home office.”

Dranow said Sam Walton was rarely in his office anyway because he preferred to be out in the stores where the customers were. The home office’s purpose was to support the operations of the stores, not to be a fancy centerpiece. The new headquarters may have more bells and whistles but will stick to that ideal.

“It’s going to be modern, but it is also going to stay true to our EDLC roots,” said Hargrove, referring to the company’s “everyday low cost” mantra. “When you talk about planning, design and costs, there is a lot that needs to take place before we would know the final costs, but a strong emphasis is going to be on supporting a culture of servant leadership that Sam Walton started from day one. It’s going to put associates and customers first, [and] it’s going maintain our commitment to fiscal and environmental responsibility.”

Home Office Timeline

Home Sweet Home
Hargrove said that the company never considered moving its headquarters from Bentonville. Wal-Mart also has large corporate presences in California and New Jersey.

Debbie Griffin, vice president of marketing and communications for the Greater Bentonville Area Chamber of Commerce, said there had been concern in the city that Wal-Mart — or at least a bulk of its ecommerce operations — might move to a city more attractive to potential employees.

“The day they made the announcement, you could put a big check mark there because that was for our community, our city and even the northwest Arkansas region a commitment that Wal-Mart was investing in our community long term,” Griffin said. “From a Chamber of Commerce perspective, we could not have asked for a better announcement from Wal-Mart.”

Wal-Mart made its announcement a week after its main rival, Amazon, set off a bidding war among cities hoping to land its second North American headquarters, but Hargrove said the company had been planning its move for years. He said the company made the announcement to get its plans in the public arena even though those plans are sparing in actual details.

“We had been looking at this project for a number of years, the idea of this,” Hargrove said. “The decision was made now to move forward with that. The focus has been on locating our new headquarters in Bentonville.”

Hargrove said Wal-Mart wouldn’t ask for “direct support” from the city of Bentonville but has applied for a capital improvement grant from the Arkansas Economic Development Commission. Hargrove said the amount of the grant would be “small but important” in relation to the overall cost of the project.

AEDC spokesman Jeff Moore said the AEDC couldn’t comment until the project was finalized.

This project “is still ongoing and developing, and it is standard policy for AEDC not to comment on active projects,” Moore said in an email message.

Already on the property that will be developed for the new headquarters, Hargrove said, are 5,000 Wal-Mart employees in several buildings and a fitness center. Avoiding disrupting current employees will be a priority.

“We’re going to be fiscally responsible for sure,” Hargrove said. “Part of that is we have to be sensitive to preserving the history and culture of the company. That begins with Sam Walton’s legacy. Back in 1971, Sam Walton recognized the company had outgrown its space in downtown Bentonville on the square and newer facilities were needed to work more efficiently. This project is in keeping with that approach.”

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