In 1984, Sam promised to “do a Hula on Wall Street” if Walmart achieved an 8 percent pretax profit. Though somewhat reluctant, he kept that promise.
Growing the Company
By the late 1970s, Sam had recruited an executive management team—“as much talent under one roof as any one retailer could ever hope to have,” he said. Sales were skyrocketing and the company was growing. Walmart acquired Mohr Value discount stores in Illinois, and, in 1981, 92 Kuhn’s Big K stores in Tennessee and other southern states. “We exploded from that point on,” wrote Sam. The press took notice. Fortune, Life, and other journals frequently ran stories on the Walmart phenomenon and its founder.
In the early 1980s, a new competitor appeared—sub-discount wholesalers with low overhead that could undersell regular discounters. Because of Walmart’s commitment to “Every Day Low Prices,” it had to meet this challenge. In 1983, the company opened the first Sam’s Club, aimed at small-business owners and other customers who buy merchandise in bulk. It was an instant success. Since then, hundreds of Sam’s Clubs have opened across the country, earning billions of dollars in sales. Sam wrote that creating this new line of stores was like a second childhood for him, “a chance to build a company all over again.”
In 1979 … we hit a billion dollars in sales … I was amazed that Wal-Mart had turned into a billion-dollar company. But I couldn’t see any logic to stopping there.
Hula on Wall Street
Generating high profits can be risky, as Sam Walton found out in 1984. He told company associates he would “do a hula on Wall Street” if Walmart achieved a record 8 percent pretax profit that year. The industry average was 3 percent. Walmart did it, and Sam had to live up to his pledge. David Glass assured that it would be a high-profile event by hiring a troupe of hula dancers and ukulele players and alerting the media.