What to say about Walmart? By now we’ve all heard horror stories about the treatment of its employees. We’ve all people-watched (more gawked) as we’ve walked through Walmart’s many aisles. Yet many of us continue to go there because the prices are just too damn good. To the surprise of many, however, a small Idaho-based grocery chain has been successfully taking on Walmart’s pricing without all the bad that comes with it.
WinCo (short for Winning Company) has over 100 stores in the Western United States. The chain consistently provides lower prices than Walmart across the board. It does so by eliminating anything unnecessary. WinCo buys most of its products directly from suppliers instead of through middlemen. Their stores have little decoration, do not accept credit cards, and let customers bag their own groceries. The stores have little variety; it has very few brands per product, similar to Aldi—the German-American chain found mostly in the Midwest. And like Costco or Sam’s Club, but without the membership fees, the store features bulk food items.
These cost-cutting strategies and small sacrifices allow not only for cheaper prices but also happier employees. WinCo already has health insurance more expansive than what Obamacare demands, giving benefits to every employee that works 24 hours per week. Its retirement benefits are just as robust; over 400 employees from its 86 locations have seven-figure pensions. Together, these advantages have led Burt Flickinger III, an industry expert, to predict WinCo’s future dominance:
“WinCo arguably may be the best retailer in the western U.S.,” Flickinger says while touring a WinCo store. “WinCo is really unstoppable at this point,” he goes on. “They’re Walmart’s worst nightmare.”
Flickinger’s analysis may seem a little premature. Walmart’s sheer immensity (largest retailer in the world, biggest private employer in the world, etc.) means it will continue to thrive for years, if only because of penetration and economies of scale. And no one can guarantee that WinCo’s business model would work on such a large scale. Furthermore, WinCo may not even want to compete with Walmart. The company’s owners keep a low profile and expand slowly. Its anticipated expansion into Texas, however, bodes well for future plans. Regardless of the size it ultimately grows to, hopefully WinCo a progressive response to Walmart’s dominance—slimming down features to keep prices low, rather than worker’s salaries and benefits.
For consumers and employees, you might call it a win-WinCo.
Below, a Los Angeles suburb celebrates the opening of a new WinCo chain.