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Wal-Mart check-out errors questioned

Wal-Mart Stores Inc. charged the wrong price to shoppers in California and the Midwest at a rate that exceeds those set by federal guidelines, according to two union-commissioned university studies released Monday.
/ Source: The Associated Press

Wal-Mart Stores Inc. charged the wrong price to shoppers in California and the Midwest at a rate that exceeds those set by federal guidelines, according to two union-commissioned university studies released Monday.

Researchers said random purchases at 60 Wal-Mart stores in California found that the wrong price came up 8.3 percent of the time. At 78 stores in Illinois, Indiana and Michigan, check-out scanners rang up the wrong price 6.4 percent of the time. In both states, some prices rang up higher and some were lower.

The National Institute for Standards and Technology says that for every 100 items scanned, no more than two should have the wrong price. The NIST’s last industry-wide study, in 1998, found the rate at 3.35 per 100.

The recent studies were commissioned by the Union of Food and Commercial Workers, which has been unsuccessful in its attempts to organize Wal-Mart workers for years, and released by a UFCW-backed campaign group, Wake Up Wal-Mart. The research was conducted by the University of Illinois-Chicago Center for Urban Economic Development and the University of California-Berkeley.

“A majority of Wal-Mart stores tested in this evaluation of price accuracy demonstrated errors in pricing that exceeded federally accepted standards for large retail establishments,” the California and Midwest studies concluded.

The researchers said the average cost of overcharges was more than that of undercharges.

Wal-Mart said it had not seen the studies and could not say if the research methods were valid.

“It is no surprise that the study, which is union-funded, is being released the week prior to our holiday sales period,” Wal-Mart spokeswoman Sarah Clark said. The holiday season is a retailer’s busiest time of year — and a bad reputation can hurt a retailer’s bottom line.

“If something is not right, we will fix it. However we do not know at this point if the study is valid,” Clark said.

The California study was finished in May 2005 and the Midwest study in September 2004, with purchases made over a number of weeks before those dates.

Analysts said the findings were surprising, especially since Wal-Mart has invested heavily for years in leading-edge software and hardware to keep close track of its inventory.

“It seems like a large number,” said Don Gher, retail analyst at Coldstream Capital Management in Bellevue, Wash.

“Wal-Mart is widely renowned for having one of the leading IT systems in the industry,” said Tom Rubel, who heads consultant Retail Forward in Columbus, Ohio.

Based on the studies, Wake Up Wal-Mart and the National Consumers League wrote to the nation’s 50 state attorneys general asking them to take steps to enforce accurate price charging at Wal-Mart.