I just finished Sam Walton: Made In America. Thank you, Jeff Bezos, for the recommendation. This is a very inspiring book. If you’ve ever had the desire to start your own business this is a must-read. Sam Walton created the wealthiest family in the world through the creation of his Walmart stores.
For this review, I decided instead of just giving a summary of the book or a biography of Sam Walton and his Walmart stores. I would instead highlight a few great ideas from the book, which I want to incorporate into my life.
Here are 6 gems I found from Sam Walton: Made In America:
1. Steal as Many Good Ideas as You Can
I admire Sam Walton’s openness about how he found good insights – he stole them. He wasn’t shy to admit that a lot of his great ideas were found in his competitor’s stores. He took their ideas, tweaked them, and implemented a better version in his own stores.
There are many accounts in the book of Sam visiting retail stores throughout the world with a pencil in hand, on the lookout for the next great idea. The Walton family couldn’t take a vacation without Sam sneaking into a retail store armed with a notebook or voice recorder. Sometimes he would speak with employees and managers at these stores for hours, quizzing them on everything they did.
Walton knew the value of great ideas. And that great ideas are almost never the creation of a single individual or entity. Instead, great ideas are built upon a foundation of past ideas. In my life, I try to record and capture great ideas that I encounter (like I’m doing for this article). I believe what Victor Hugo once said that there is nothing more powerful than an idea whose time has come. I’ve captured a few and know their time will come.
2. Look where others are avoiding
Sam Walton said that Walmart’s success came out of necessity. All of the other discount stores like Kmart, Target, etc., wouldn’t go into small-town America because they didn’t think there was any money to be made there. But Sam knew that he could be successful in these small towns. America was full of small towns, and Walmart was able to gain a strong foothold in these communities before the other discount stores even thought to go into them.
What are the “small towns” today? The areas of the market that are underserved and ignored? In this particular case, they were in plain sight and waiting for any company to come and serve them, but the experts said it would never work. Don’t let anyone tell you something can’t be done. What would have happened to Walmart if Sam Walton believed what all the other big discounters believed?
3. Pass assets on to your family before they appreciate
This is a little gem at the beginning of the book. Walton describes how he set up his business as a partnership with his children’s involvement very early on. He got this idea from his father-in-law. The idea is that the best way to pass wealth on to future generations is to pass on the assets before they appreciate in value.
So long before Walmart was the retail behemoth it is now, Sam Walton had passed on a lot of his ownership to his children. He created a company called Walton Enterprises which owned Walmart stock. One thing his family never did was sell their Walmart stock. Today, their net worth is almost entirely tied up in Walmart stock. That interest today has now created billions of dollars of wealth. The Walton family is considered the wealthiest family in the world. The family has an estimated combined net worth of over 150 billion dollars with most of their net worth tied up at Walmart stock. This wealth is spread out among dozens of heirs.
4. Be passionate
Early on in his life, Sam Walton decided he was going to be a ‘retail’ man. He had a burning passion to create the best retail experience for the customer. Everything he did was for the customer. He figured that if he could figure out what the customer wanted and equipped his stores to meet the customer’s needs then the revenue would come. His passion led him to never stop improving. He spent hours every day in search of good retail ideas.
5. Big businesses, generally, provide real value to people
Sam Walton believed that Walmart brought a lot of value to its customers. Walmart was continually accused of doing harm in the communities they entered. They supposedly shut down local businesses. Walton had a lot to say about this subject. He felt that nostalgia played a role in this argument. People had a preconceived notion of what a small business on main street is supposed to look like.
When they return to their hometowns and see that the shop they went to when they were younger is closed it’s easy to blame Walmart for the closure. However, Walton blamed the owners of those stores of not being innovative and not wanting to change. Most of them didn’t do anything to be competitive when Walmart came to town.
Walton believed that big business is able to do things more efficiently. He felt strongly that Walmart looked after it’s employees. By providing a living and opportunities to advance in the company he thought Walmart did a lot of good for its employees.
I started reading Big Is Beautiful: Debunking the Myth of Small Business. The general premise is that those big businesses are much more efficient and provide more value to customers than small businesses. Big businesses pay their employees better. The book explores the pro-small business narrative that is often repeated in politics.
6. Speak to people before they speak to you
Sam used this technique while in college. He said he was involved in just about every organization and activity on his campus. He said the key to it was to just smile whenever you saw someone in the hallway, and speak to them before they could speak to you.
This confidence was crucial for Walmart as Sam successfully negotiated business deals. He constantly stressed to his employees that they needed to smile and be confident to speak to any customer. He told his employees if they would do this they (and Walmart) would be successful.
Conclusion
I loved this book. So much so that I read it twice in a week. You can pick up a copy here.
Write to me: sam@samuelpedro.com