Consider the Vendor Factor (Jeff Hankins Commentary)

I wish we could compile the total number of jobs, the total payroll and the total office space for all the Wal-Mart Stores Inc. vendors who have set up operations in Benton County.

It would be very difficult to identify all of them, let alone obtain those kinds of numbers.

But here’s a pretty safe hunch: those combined numbers would make “Vendors Inc.” the fifth-largest economic driver for Northwest Arkansas. That’s right behind Wal-Mart in Bentonville, Tyson Foods Inc. in Springdale, J.B. Hunt Transport Services Inc. in Lowell and the University of Arkansas in Fayetteville.

When Wal-Mart decided to encourage a local presence by vendors, it was equivalent to the state landing a major Fortune 500 company with hundreds of high-paying jobs. But instead of a single announcement, it was an evolution that is now producing results no one could have imagined.

A recent article in the Washington Post accurately portrayed a region with soaring population, personal incomes and housing prices. The result is more demand for upscale services, retailing, restaurants, office space, schools and everything related to home construction.

The days of Wal-Mart founder Sam Walton’s insistence on modesty by the company’s employees and vendors are ancient history. In the early ’90s, an Arkansas building contractor who did a lot of work for Wal-Mart was featured in Arkansas Business and pictured in front of a Mercedes-Benz car. We later heard that the contractor lost the Wal-Mart account because he appeared to be making too much money from that work. I always found that hard to believe, but later heard similar stories that made it plausible.

Mr. Sam probably wouldn’t be happy today about the lifestyles of Vendors Inc. and Wal-Mart employees, but the changes were inevitable. High-level employees recruited to Wal-Mart headquarters itself from the big cities can’t be faulted for needing to reinvest profits from home sales.

Keep your eye on the future of Vendors Inc.

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During the recent City Year Inc. national convention in Little Rock, I moderated a Corporate Civic Innovation Forum that focused on philanthropy and partnerships between businesses and communities.

These are the highlights I heard:

• The days of nonprofits simply asking for money and businesses giving it blindly are fading. Businesses want to know specifically what the nonprofit’s needs are.

• Before making donations or agreeing to partnerships, companies are asking: “What can we do that will make a difference?” They are more interested in supporting specific projects than in supporting general operations.

• Metrics are overrated in terms of requiring organizations to quantify returns on investment, the number of people impacted or served, and the like.

• Major national foundations are taking holistic approaches to identifying which projects to fund. Instead of focusing specifically on health care or education or the environment, they want projects that reach across those verticals for multipurpose benefits.

• Corporate mergers present all kinds of difficulties for long-established partnerships between businesses and nonprofits. Some nonprofit inevitably loses major support in the aftermath of a merger.

The City Year program itself appears to do an excellent job of pulling together public service, education, corporate involvement and communities. The local organization is already making a positive impact on local schools and is poised for expansion.

(Jeff Hankins can be reached via e-mail at [email protected].)