The Arkansas State Chamber of Commerce is preparing a major campaign to call attention to the state’s workforce needs and opportunities. Meanwhile, legislators are preparing to consider a package of workforce-related bills.

State Chamber CEO Randy Zook said Monday that the Chamber is in the middle of raising money for a multi-year informational campaign beginning later this spring or in the early summer. He declined to say how much the Chamber would try to raise but did say it would be a multi-million dollar campaign.

“It’s going to be a major effort, and the reception for it has been nearly universal,” he said. “People get it when they realize we’ve got to do something, and people are stepping up to it.”

Zook said the effort will involve a media campaign, earned press coverage, social media promotion, and mobile activities such as a tractor-trailer that travels to schools and public events. The message, he said, will be that there are “a lot of roads to success in the U.S. economy.”

The Chamber already has been working to raise awareness of workforce deficiencies that are causing jobs to be unfilled, including hosting a Jobs Now workforce summit last year.

“We’ve got to address it because business is not seeing the candidates in quantity or quality that they need to meet their current workforce needs in many cases. … I think this is an awareness that’s growing and continues to gain strength and momentum,” he said.

Zook has been working with Sen. Jane English, R-North Little Rock, the chair of the Senate Education Committee who is expected to unveil a package of workforce-related bills soon. English, previously a private option opponent, agreed to vote for the program in the 2014 fiscal session in exchange for a commitment from then-Gov. Mike Beebe to revamp the state’s workforce eduction efforts. English spent much of the year meeting weekly with state education and economic development officials.

Zook said the package will be “nuts and bolts kind of things.”

“These steps that she’s proposing are going to be constructive and very doable and will encourage the longer range activity to make sure that we’re continuing to work on this,” Zook said.

If there is a comeback kid in the Arkansas corporate world, it would have to be Van Buren-based USA Truck. Officials with the long-haul trucking and logistics company announced 2014 net income of $6.033 million, a more than $15 million swing from the $9.11 million loss in 2014, and a gain that ended five consecutive years of losses.

The 2014 per share net income of 58 cents beat the 51 cents per share that was the average of estimates among analysts who cover the company. Full year revenue for the company was $602.477 million, up 8.55% compared to 2013.

Driving the solid annual gain was a healthy fourth quarter in which net income was $4.182 million, much better than the $4.636 million loss in the fourth quarter of 2013. However, the 2013 quarter saw the company, which has a self-funded insurance program, post a $5.97 million charge to boost its long-term claims reserve. The company also posted a $1.5 million charge in the 2013 quarter for expenses related to fighting a hostile takeover attempt by Phoenix-based Knight Transportation.

Knight’s takeover attempt also crimped 2014 earnings by $2.8 million.

The fourth quarter per share earnings of 40 cents blew past the consensus estimate of 18 cents. Revenue during the quarter was $150.07 million, up 6.1% compared to the same quarter in 2013.

“Our robust fourth quarter capped a transformative year for USA Truck,” President and CEO John Simone said in the earnings report released early Wednesday (Feb. 11). “As a result of our company-wide focus on operational execution, profitable growth and cost effectiveness, we delivered our ninth consecutive quarter of improved results, our third consecutive quarter of positive operating income, and the Company’s highest quarterly earnings per share in more than nine years.”

The publicly held trucking company has lost more than $48 million in the five years before 2014. The company posted a net loss of $9.11 million in 2013, a net loss of $17.671 million in 2012, a 2011 loss of $10.77 million, a 2010 loss of $3.308 million, and a $7.177 million loss in 2009.

Barring an acquisition, several more years of positive numbers will be needed for the company to dig out of debt.

“Our balance sheet strengthened and our increased cash flow generated from operations will allow us additional flexibility. Year over year, our debt was reduced by a total of $11.4 million to a total of $117.5 million,” USA Truck Chief Financial Officer Michael Borrows said in the earnings report.

Simone said the improved financial are a result of “strong process on the execution of our turnaround plan.” That plan was implemented shortly after Simone arrived at USA Truck in February 2013. During his first few weeks on the job Simone analyzed the operations and issued what he called a “100-day plan.” The plan included 27 “high-leverage activities” he believed could restore profits. The 27 activities included reducing insurance costs and claims expense, improving fuel efficiency, and lowering maintenance costs while also improving overall maintenance operations.

The company also was focused on diversifying the business model by growing their Strategic Capacity Solutions (SCS) – logistics and freight brokerage – division. The division generated 29.7% of total revenue – $178.982 million – for the company in 2014, up from 24.6% in 2014.

While it was a robust fourth quarter, key metrics for 2014 show that struggles remain on the trucking side. For example, the operating ratio for the full year was 101.1%, better than the 105.4%, but still reflecting a loss of 1.1 cents for every dollar of revenue. And potentially reflecting pressure from an industrywide driver shortage, the percentage of in-service tractors without a driver in 2014 was 7%, up from the 5.1% in 2013. The number of “deadhead” miles was 12.7% in 2014, up from 11.8% in 2013, and the total miles driven fell from 223,923 in 2013 to 215,479 in 2014.

The weak metrics in the key categories were primary culprits in the company posting a $3.532 million operating income loss in the trucking division. However, it was a big improvement over the $17.667 million operating loss in 2013.

Saving the day with respect to full-year figures was the SCS division, which posted operating income of $20.775 million, more than double the $9 million in 2013.

Company execs believe that improvements to the key metrics seen in the fourth quarter will continue into 2015. The operating ratio in the fourth quarter was 95.1% compared to 109.1% in the 2013 quarter. Operating income for the trucking division during the fourth quarter was $4.24 million, an almost $12 million improvement over the operating loss of $7.613 million in the fourth quarter of 2013.

“In 2015, we believe USA Truck is well positioned to deliver another year of growth and continued operating improvements,” Simone said in the statement. “We are sharpening our focus on enhancing the Company’s ability to provide capacity solutions by growing our dedicated business, growing our SCS footprint and our owner-operator fleet. In addition, we will continue to refine our Truckload network.”

Although thinly traded, investors have rewarded the company’s overall improved performance. USA Truck shares (NASDAQ: USAK) closed Tuesday at $27.67, up 25 cents. During the past 52 weeks the share price has ranged from a $13.29 low to a $30.51 high.

The awards and accolades continue to pour in for one Fayetteville-based venture— PicaSolar — tagged as a "Startup to Watch" by The City Wire last year.

PicaSolar learned this week that its hydrogen super emitter (HSE) is among those innovations to be recognized at the Edison Awards Gala held April 23  in New York. 

The company knows it has earned a silver, bronze or gold level award and it will find out which during the upcoming gala.

As a 2015 Edison Award finalist PicaSolar went head-to-head against companies like Yahoo!, Motorolla, Proctor & Gamble, Kellogg, Pepsico and Google, all of which were nominated for innovative products as well.

“The Edison Award is a demonstration of the innovative work being done by the whole team at PicaSolar. It is a great honor to receive an award next to the likes of Dow, GE, LG and other leaders in their fields,” said Douglas Hutchings, CEO of PicaSolar.

He added that perhaps it is fitting that Thomas Edison himself once said,

"I'd put money on the sun and solar energy. What a source of power. I hope we don't have to wait until oil and coal run out before we tackle that."

The awards, inspired by Edison’s persistence and inventiveness, recognize innovation, creativity and ingenuity in the global economy. 

“It’s exciting to see companies like PicaSolar continuing Thomas Edison’s legacy of challenging conventional thinking,” said Frank Bonafilia, Edison Awards’ executive director. “Edison Awards recognizes the game-changing products and services, and the teams that brought them to consumers.”

Edison Award nominees are judged by more than 3,000 senior business executives and academics from across the nation whose votes acknowledge the finalists’ success in meeting the award’s stringent criteria of quality.

The number one internal lever Wal-Mart said it can pull this year is to grow comp store sales. Top executives note that they can’t do it alone, which is why the retail giant outlined its core strategies last week (Feb. 2 - 5) to suppliers in the annual “Year Beginning Meetings” held in Orlando. 

“Our core message this year is to make our stores better all over the world. ... Nothing will move the needle up like comp sales. We are investing to define the future of retail with our team out in San Bruno and around the world. ... We are listening to our teams out in the stores trying to create a better in-store experience, engaging our hourly associates is a priority for us,” CEO Doug McMillon said in his opening remarks at the annual YBM event.

Aside from improving store operations, McMillion was quick to tell suppliers the retailer is going back to what works and that is the “Everyday Low Prices” (EDLP) philosophy which begin with Everyday Low Costs (EDLC) of goods from suppliers.

“What we need from you is EDLP and EDLC. We are still fighting this battle in some parts of our business. ... That’s because it’s just so tempting to put an item on sale. Putting items on sale and special promotions have never worked for us. When we get away from our pricing model out in the middle of the road we get run over,” McMillon said.

‘PLAYING OFFENSE’
He told suppliers that figuring out how they could move back toward a net invoice cost with Wal-Mart is going to be critical this year. McMillon said the retailer would lean upon the merchant leadership from its suppliers to get back to “playing offense with price to deliver EDLP and earn customer trust.” 

“We want to drive more business for you and us in a collaborative fashion. We are thinking about (how) dynamic pricing tools via the Internet can be applied and we don’t have it all figured it out just yet. But what I do know, is that our pricing objective is aimed at building customer trust,” he said.

With Wal-Mart’s capability to provide inventory in-store and online and the low cost pricing model, McMillon said he doesn’t want customers to doubt that Wal-Mart has the items they want at they price they want to pay.

Greg Foran, CEO of Walmart U.S., said at the meeting that the best of EDLC suppliers are already seeing benefits. He said one item retailed for $2.94 last year, but with supplier and buyer collaboration the price was taken down to $1.68 this year, with no reduction in quality. In response, Wal-Mart doubled its order to 13 million, up from 6 million last year.

Foran was not bashful telling suppliers that they should put their best and brightest talent on the Wal-Mart account. He said Wal-Mart wants to collaborate with suppliers’ best in order to get top results for both parties.

PRODUCT PUSH
McMillon said new items are crucial this year. He encouraged suppliers to innovate and then ramp up quickly so Wal-Mart can keep a fresh stream of new items in stores. He said the retailer is committed to ordering deeper and gambling somewhat on new items they think will resonate with the customer base. 

Other top Walmart executives said during the meeting that buyers may want to expand assortment and they always want Walmart to be first to market with some exclusivity. But the retailer also is eager for more candid conversations with suppliers about leaner supply chain costs and building brand awareness.

In the midst of the small store boom, with grocery leading the way. Mike Moore, president of Neighborhood Markets, said if this grocery chain stood alone it would rank in the top 50 grocers in the nation. After opening 100 new grocery formats in recent months, the Neighborhood Market banner now has 601 stores in the U.S.

Moore said there are opportunities in the smaller stores for suppliers as they work to create better product displays and product mixes that make sense. He said they are looking to suppliers for input on issues like seasonal items and other general merchandise items that could be regularly featured.

“We are eager to try and test new things with this format,” Moore said.

There is also the localization of content in the neighborhood stores. While there is no set policy by corporate execs, store managers have the ability to source local items. It is commonly done in produce and fresh foods, but it also applies to flavor preferences and even ethic food offerings. 

The retailer announced it will hold another open call for new products made in the U.S. on July 7 in Bentonville.

SUSTAINABLE SOLUTIONS
Underscored by Wal-Mart’s top management is the need for sustainable solutions from product innovations like LED lighting to zero waste packaging. Much of the low hanging fruit has already been gathered, the execs said, and Wal-Mart will continue to lean on suppliers to help with the sustainability initiative. 

Wal-Mart will hold its Sustainability Milestone meeting in San Bruno, Calif., on Feb. 24. 

Michelle Gloeckler, executive vice president and U.S. manufacturing lead, said at the YBM event that 1,400 suppliers are participating in the sustainability survey and their score is posted on their evaluations. She said participating is important because buyers look closely at sustainability during the purchasing process.

(For this story, The City Wire was able to listen to recorded sessions of the event.)

Hospitality tax collections in Fort Smith and Van Buren were up 4.2% and 1.4%, respectively, and collections of Arkansas’ 2% tourism tax has set a new annual record for collections during the first 11 months of 2014.

Hospitality tax collections in Van Buren for 2014 total $430,278, up 1.4% compared to the same period in 2013. The city collects a 1% tax on lodging and a 1% prepared food tax.

For the year, revenue from Van Buren’s prepared food tax was $370,445, up from the $363,607 in 2013. Full year revenue from hotel tax collections was $59,833, down from the $60,702 in 2013. An odd December caused the slip, with December hotel tax revenue of $3,491 being 22.5% below that of December 2013.

“There is one motel that changed ownership late in 2014 and their December taxes haven't been paid, however, all the other properties except one were significantly off from 2013,” said Maryl Koeth, executive director of the Van Buren Advertising & Promotion Commission .

Koeth said weather conditions in December 2013 may have forced travelers to stay in hotels longer than planned. According to Koeth, December 2013 was the 7th snowiest December on record.

“It also explains why prepared food totals are up over 5% from December 2013. Fewer people went out to eat in the bad weather of 2013,” she said.

Overall December receipts totaled $33,257, up 1.35% compared to December 2013.

Collections in Van Buren during 2013 totaled $423,221.83, remarkably close to the $423,222.91 during 2012. During 2012, Van Buren hospitality tax collections totaled $425,554, up 5.2% compared to the 2011 collections. Hospitality tax collections in Van Buren during 2011 totaled $429,561, up 2.34% compared to 2010. The 2011 collections ended a two-year skid in Van Buren.

FORT SMITH NUMBERS
The Fort Smith Convention & Visitors Bureau collected $761,826 in 2014, up 4.2% compared to 2013. The city collects a 3% tax on lodging.

December hospitality tax collections in Fort Smith totaled $50,145, down 4% compared to December 2013.

Claude Legris, executive director of the Fort Smith Convention & Visitors Bureau, said 2014 saw a one-year loss of the large conferences held by the Christian Congregation of Jehovah’s Witnesses (CCJW) at the Fort Smith Convention Center in recent years. The group is expected to return to Fort Smith in 2015.

“Citywide hotel occupancy for the year was +2.4% and average daily rate increased 3.3% which helped us to achieve the 3% growth we had anticipated with best results from the third and fourth quarters. In addition to these overall increases we were able to ‘recover’ some of the revenue by hosting a series of smaller CCJW meetings throughout the year,” Legris said.

He is also projecting $848,800 in hotel tax revenue in 2015, up 11% from 2014, with much of that growth based on the CCJW return.

“Although we expect some temporary decrease in inventory due to renovation projects (including the complete renovation and ‘reflagging’ of the Holiday Inn City Center property), we will also see the addition of 90 rooms with the completion and opening fo the ‘Home2’ project on Phoenix Avenue,” he said.

Collections in Fort Smith during 2013 totaled $731,057, down 2% compared to the same period in 2012. During 2012, Fort Smith hospitality tax collections totaled $746,182, up 5.37% compared to the 2011 period. The 2011 collections were up 4.3% compared to 2010.

Increases in Fort Smith and Van Buren hospitality tax numbers corresponds with job gains in the region’s tourism industry. According to the U.S. Bureau of Labor Statistics, the region’s leisure and hospitality sector employed an estimated 9,500 during December, down from 9,900 in November and above the 9,200 in December 2013. The sector reached an employment high of 9,900 in August, September and November.

ARKANSAS TOURISM TAX, JOB NUMBERS
Collections of Arkansas’ 2% tourism tax during the first 11 months of 2014 totaled $12.866 million, up 7.51% compared to the $11.967 million during the same period of 2013.

The 2% tourism tax set a record in 2013 by reaching $12.716 million, and the 2014 numbers are on track to reach more than $13.5 million in 2014.

The 2013 collections were up 2.5% compared to the $12.405 million in 2012, and well ahead of the $11.378 million slump in 2009 when national economic conditions proved tough on Arkansas’ tourism industry.

Growth in tourism jobs has tracked with growth in statewide tourism tax collections, with employment recently hitting a new record for Arkansas’ travel and tourism industry. Arkansas’ tourism sector (leisure & hospitality) employed 109,400 during November, up from 109,200 during December, and above the 106,600 during November 2013. The November number, if it stands, marks a new record for employment in the sector.

Arkansas’ tourism sector (leisure & hospitality) employed 113,900 during December, up from 110,400 during November, and above the 106,900 during December 2013. The December number, if it stands, marks a new record for employment in the sector. Employment in the sector is up 23% in the past 10 years.

Wal-Mart Stores plans to invest $340 million this year expanding its footprint in Canada. The plans have been scaled back from $500 million a year ago.

The retailer said about $230 million will be spent constructing 29 supercenters. The rest of the investment will go toward adding full grocery departments and expanding several other stores already operating there.

This announcement comes one month after competitor Target said it would exit Canada as it had failed to make its own business profitable in the two years it’s been there.

David Cheesewright CEO of Walmart International, said last week at the retailer’s Year Beginning Meetings, that the global investments are being slowed a bit as they work on reinforcing the foundation and increasing operational efficiencies in its mature markets.

The nine-month gridlock between major West Coast port terminal operators and dockworkers which resulted in a weekend shutdown has raised concerns within the retail industry which has stayed fairly mute on the impact until now.

Research group Kurt Salmon estimates that congestion at West Coast ports could cost retailers as much as $7 billion this year. The analysis attributes those costs to a combination of the higher price of carrying goods and missed sales due to below optimal inventory levels.

The National Retail Federation warns that a shut down over the any prolonged (10-day period) hit the economy by $2.1 billion a day as half of the nation’s imports pass through the 29 West Coast ports.

THE LABOR PROBLEM
At issue are a few remaining contract issues between the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association. The union represents about 20,000 dockworkers at 29 West Coast ports, and the PMA negotiates for the major port employers, including Denmark-based Maersk Line, China-based COSCO and Korean-based Hanjin Shipping.

The recent weekend closure was the result of the PMA stopping operations and not a strike by the union. The union, which has represented dockworkers in California, Oregon and Washington since 1934, has said it has dropped most of its demands with just a few remaining issues to be settled. The union also has accused the PMA of creating congestion and delays and then attempting to blame the problem on union workers.

“PMA is leaving ships at sea and claiming there’s no space on the docks, but there are acres of asphalt just waiting for the containers on those ships, and hundreds of longshore workers ready to unload them. The employers are deliberately worsening the existing congestion crisis to gain the upper hand at the bargaining table,” the union said in a statement. “The union remains focused on reaching a settlement as quickly as possible with employers. Talks to resolve the few remaining issues between the Longshore Union and Pacific Maritime Association are ongoing.”

However, the PMA said “ongoing and costly ILWU slowdowns” have forced weekend port closures. The association also said it recently made a generous contract offer.

“Last week, after nine months of contract talks, PMA last week made a comprehensive contract offer that would raise ILWU wages by 14 percent over five-years, on top of current average full-time wages of $147,000 per year. It would maintain fully employer-paid health care, worth $35,000 per year, and increase the ILWU pension to as much as $88,800 per year,” the association said in a statement.

No matter who is at fault, the result for retailers is not good.

WAL-MART RESPONSE
Retail behemoth Wal-Mart Stores told The City Wire that the West Coast ports congestion is a concern but it has not seen any material impact on its business thus far.

“We have a diverse import network that has helped us to mitigate some of the problems experienced with the West Coast ports. Our network includes Seattle, Houston, Savannah, Ga., and Norfolk, Va., in addition to Los Angeles and other West Coast ports,” said Aaron Mullins, corporate spokesman for Wal-Mart Stores.

Wal-Mart imports an estimated $20 billion in products annually from China. Perishable and seasonal items are most impacted by the delays because if they miss their narrow window of retail opportunity the product is often a total loss.

IMPORT SHIFT ATTEMPTS
Supply chain experts also said shifting imported goods to other ports (East Coast or Gulf of Mexico) increases land travel time and costs into the supply chain. Those added costs eat into profit margins unless the retailer is willing or able to pass them on to consumers. High-end retailer Ralph Lauren noted in a recent earnings call that it opted to airfreight more products during the recent quarter. By shifting some delivery to the East Coast the retailer said it added between 3 and 10 days of transit time, which still allowed it maintain service levels.

Kurt Salmon analysts warn that rerouting to East Coast ports or buying extra inventory in advance are only temporary fixes for what is a larger problem. They note that if conditions continue the retail sector could face $36.9 billion more in baseline costs in 2016 compared to 2014.

The NRF is not mincing words about the impact the port turmoil is having on the retail and supply chain industries.

“Temporarily suspending port operations is just another example of the International Longshore and Warehouse Union and Pacific Maritime Association shooting themselves in the collective bargaining foot. The increasing congestion at West Coast ports are bringing the fears of a port shutdown closer to a reality,” said Jonathon Gold in reaction to the temporary suspension at the West Coast ports this past weekend (Feb. 7-8).

Gold, the NRF vice president of supply chain, said the entire supply chain has been dealing with the lack of a West Coast port contract since May 2014.

"Enough is enough ... Stop holding the supply chain community hostage. Get back to the negotiating table, work with the federal mediator and agree on a new labor contract,” Gold noted in public statement on Feb. 6.

BROAD IMPACT
Concerns have rippled down the supply chain and causing manufacturers like Marshalltown Company, who makes tools in Fayetteville, keep considerably more inventory than they might otherwise carry. Jack Murders, operations manager in the Fayetteville plant, recently told The City Wire that they began shifting some of their shipments to the Seattle/Tacoma port months ago, but congestion is building there as more companies have had the same idea.

Import cargo volume at the nation’s major retail container ports is expected to rise 10.1% this month over the same time last year even as West Coast ports come closer to a possible shutdown, according to the monthly Global Port Tracker report released Wednesday (Feb. 11) by the National Retail Federation and Hackett Associates.

“With cargo volume growing as the economy continues to recover, the last thing we need is a port shutdown that would bring billions of dollars of economic activity to a halt,” Gold said. “

EXPORT CONCERNS
Springdale-based Tyson Foods is an exporter in addition to being a retail supplier who recently referenced the port issues and the impact it’s having on the meat business. 

“We believe part of the recent decline in beef and pork prices experienced by the U.S. meat industry is due to the West Coast port slowdown, which (Tyson CEO) Donnie Smith noted last month. This could eventually affect livestock producers. Shipping alternatives for the industry are limited, but we’re actively seeking other channels,” Tyson Foods’ spokesman Gary Mickelson noted in an email.

Smith told analysts during the company’s recent earnings call that the company’s “primary concern about exports is coming from ongoing interruptions at West Coast ports, which is pressuring logistics that could eventually affect livestock producers if the situation isn't resolved soon.”

Roughly 25% of pork produced in the U.S. is exported. But if the pork isn’t shipped, then it fills up freezers, which will push domestic pork prices lower. This is positive for the consumer, but a negative for processors and swine farmers. Likewise some beef cuts that might ordinarily be exported for higher sales prices abroad are being ground into hamburger, which has led to a slight reduction in beef prices.

The U.S. meat and poultry industries estimate they are losing $40 million a week as products destined for export from West Coast ports continue to pile up in commercial freezers around the country as the port labor dispute continues. The North American Meat Institute reported this week that lost hides and skins export sales total $42 million per week. The trade group said it continues to work with other organizations pleading for government intervention sooner rather than later.

Collections of Arkansas’ 2% tourism tax needed only 11 of the 12 months of 2014 to set a new annual record. Richard Davies said this might happen.

Collections of Arkansas’ 2% tourism tax during the first 11 months of 2014 totaled $12.866 million, up 7.51% compared to the $11.967 million during the same period of 2013.

The 2% tourism tax set a record in 2013 by reaching $12.716 million, and the 2014 numbers are on track to reach more than $13.5 million in 2014. When the 2013 record was set, Davies, executive director of the Arkansas Department of Parks & Tourism, predicted that 2014 would be even better.

The 2013 collections were up 2.5% compared to the $12.405 million in 2012, and well ahead of the $11.378 million slump in 2009 when national economic conditions proved tough on Arkansas’ tourism industry.

Growth in tourism jobs has tracked with growth in statewide tourism tax collections, with employment recently hitting a new record for Arkansas’ travel and tourism industry. Arkansas’ tourism sector (leisure & hospitality) employed 109,400 during November, up from 109,200 during December, and above the 106,600 during November 2013. The November number, if it stands, marks a new record for employment in the sector.

Arkansas’ tourism sector (leisure & hospitality) employed 113,900 during December, up from 110,400 during November, and above the 106,900 during December 2013. The December number, if it stands, marks a new record for employment in the sector. Employment in the sector is up 23% in the past 10 years.

The positive statewide numbers were likely helped by increased tourism and travel activity in Northwest Arkansas. Football, craft fairs, art and a growing Northwest Arkansas economy helped to spur a 8.2% jump in hospitality taxes among the region’s four largest cities through the first 10 months of 2014.

Bentonville Fayetteville, Rogers and Springdale reported $4.805 million in hospitality taxes from January through October 2014. That compared to $4.44 million reported in the same period of 2013. Each of the cities collect a 2% hotel tax, Fayetteville also collects a 2% prepared-food tax, while Bentonville has 1% restaurant and prepared-food tax.

The third quarter results (July through September) for the four cities rose 9.8% fueled in part by an impressive 14.6% gain in Bentonville and a 17.8% rise in Springdale.

Employment in the region’s tourism industry was 22,300 during December, down from a revised 22,500 in November but ahead of the 21,100 in December 2013. Sector employment reached a record of 22,800 in September. Employment in the regional sector is up 45.7% compared to the 15,300 employed in December 2004.

Less than two years ago Van Buren-based USA Truck was losing money faster than a fur coat sales booth at a PETA rally. Company shares, which historically traded between $10-$20 per share, had dipped below $3. By the end of 2013, the company would post five consecutive years of losses that totaled almost $48 million – wiping out the $45.76 million in net income earned between 2001 and 2008. The company likely would have been shot if it were a horse.

In late 2012 the USA Truck Board of Directors reached out to Harvard graduate Robert Peiser to chair the Board and get the company back in the black. Peiser, known in corporate circles as someone able to rescue a company for future growth or acquisition, hired John Simone in early 2013. He had a reputation in the trucking and logistics sector for tidying up troubled operations.

Peiser and Simone began making wholesale changes to USA Truck’s corporate philosophy, management and strategy. The effort was soon made more difficult when a hostile takeover attempt was made by Phoenix-based Knight Transportation. Knight eventually withdrew from the fight.

Even in the midst of the Knight action, Simone began implementing a broad 27-point plan focused on reducing expenses, broadening relationships with key customers, and, as Simone has said, returning to the basic “blocking and tackling” of a trucking company.

‘BETTER TRAJECTORY’
It’s working – thanks in no small part to an improving national economy and national freight sector dynamics that now favor the trucking industry. The company reported Wednesday (Feb. 11) that 2014 net income was $6.033 million, a more than $15 million swing from the $9.11 million loss in 2014. The swing ended five consecutive years of losses.

Investors are impressed. USA Truck shares (NASDAQ: USAK) on Wednesday hit a company record intraday trading high of $31.99 – well above a 52 week low of $13.32. The price would eventually close the day at $29.97.

Somewhat ironic is that the non-asset side of USA Truck was a big factor in the positive 2014 earnings report. The company’s Strategic Capacity Solutions (SCS) – logistics and freight brokerage – division posted operating income of $20.775 million, more than double the $9 million in 2013. The trucking division posted a $3.532 million operating income loss in 2014 – although it was a big improvement over the $17.66 million operating income loss in 2013.

SCS generated 29.7% of total revenue – $178.982 million – for the company in 2014, up from 24.6% in 2014. Simone said there is not set timeframe, but his goal for SCS is to deliver about 40% of annual revenue.

There was a measure of relief in Simone’s voice during a Wednesday interview, but he was far from celebratory. He said the “early surprises have settled down,” but the turnaround is “still in the early innings.” On the 27-point plan, the company has completed 13. Of the 14 remaining, Simone said there are five that account for about 80% of the “upside” for future growth and financial performance. Simone said the five items are reducing insurance and claims expenses, reducing maintenance operating expenses, reducing out-of-route and empty miles (non revenue miles), improving fuel economy and improving retention of experienced drivers.

Simone is confident the company will have a “better trajectory in 2015” because a massive, fleetwide upgrade to the company’s more than 2,000 trucks was completed in 2014. The effort resulted in higher expenses in 2014, and resulted in more non-revenue miles driven to get the trucks on a schedule that would get them in and out of maintenance shops. However, Simone expects margin improvements in 2015 with trucks that are more efficient and provide “more creature comforts” for drivers.

THE DRIVER SHORTAGE
Drivers will be a problem for the entire trucking industry in 2015. The American Trucking Associations estimates a shortage of about 35,000 drivers for the industry, with that number predicted to reach 200,000 by 2020. Part of the problem is a combination of experienced drivers approaching retirement age and fewer young people entering the profession.

The industry is responding by improving pay and benefits.

“Fleets are raising pay and offering generous benefit packages in order to attract and keep their drivers in the face of a growing driver shortage,” ATA Chief Economist Bob Costello noted in a December report.
 
His report showed that median pay for drivers ranged from a little more than $46,000 for national, irregular route truckload drivers to more than $73,000 for private fleet van drivers. In seven of the nine categories of drivers covered by the ATA survey, pay met or exceeded the U.S. median household income of more than $53,000.

Simone said USA Truck has “a number of initiatives in place,” including driver wage increases and more “home time” for drivers. The pay increases were not broad. The company used a “scientific approach” to identify excessive turnover demographics and then respond with financial and other incentives within that set of drivers. Simone said the company in 2014 and early 2015 had to spend more than planned on driver pay and benefits “because the market dynamics as it related to drivers, changed pretty dramatically” – especially in the early weeks of the first quarter of 2015.

The company has also flipped its mix of drivers. Just a few years ago the mix was about 35% experienced drivers and 65% new students. That is now about 75% experienced and 25% students. Simone said the company will maintain that ratio because it is important to recruit young people into the profession. He also said addressing the driver issue requires constant assessment.

“We continuously monitor why drivers come, why drivers leave and why drivers stay,” Simone said.

BETTER RATE STRUCTURE, EXPECTATIONS
Efforts to improve the company and maintain equipment so that service was “more consistent and reliable” has helped USA Truck raise rates, Simone said. Prior to 2014 the company’s rate structure was below market averages, but improved customer service levels have allowed USA Truck to achieve overall rate increases close to 10% in 2014.

Simone said there is “some room for uppricing” in 2015, but estimated that rate increases will moderate back to a 3% to 6% range.

What is not likely to moderate are Simone’s expectations and his effort to check off the other 14 points of the turnaround plan. Simone said the “rallying cry” for the company in 2015 is “USA Truck – even better.”

He’s not the only optimist. Brad Delco, the transportation industry analyst with Little Rock-based Stephens Inc., said in a Feb. 12 investor note that the company’s truckload segment “contributed to bottom-line results meaningfully for the first time since 2007. Looking ahead, we expect continued progress on variable expense reductions and pricing to drive margin improvement into FY'15.” He said USA Truck’s 2014 results were a “big earnings surprise.” (Stephens owns shares of USA Truck, and provides investment banking services for the company.)

Delco raised his fiscal year 2015 earnings per share target from $1 to $1.25, with “greater momentum” on higher rates for truckload services as a key factor in driving more revenue. He also said the company’s efforts to improve fleet fuel economy combined with lower diesel fuel prices helped boost the bottom line. He said an about 10% improvement in fourth quarter miles per gallon “suggests to us that the improvement in this line item is more sustainable that what some might think.”

SIMONE’S FUTURE
Because of Simone’s corporate history, his tenure in Van Buren has been in doubt. Even Simone has said in a previous interview with The City Wire that his DNA is more of a builder than a sustainer. So is John Simone a transient? Does he spend 3-5 years with USA Truck and then move on to the next challenge?

“I’m not transient. This is a great company. This is not a stopping point for me, this is a finishing point for me,” Simone said.

He said when the turnaround plan is complete, there will continue to be areas on which the company can build.

“My initial goal was to improve our operating performance and restore shareholder value,” Simone said, adding later in the interview that “there is still so much opportunity left in this company. ... We’re going to continue to reinvent ourself and move this company forward.”

Tyson Foods Inc. awarded a $120,000 grant to the Office of Diversity Affairs at the University of Arkansas to create the Tyson Inclusive Excellence Scholarships and the Tyson Academic Enrichment Program.

The grant will be used to retain and graduate underrepresented juniors and seniors majoring in the science, technology, engineering, mathematics, business technology, food science or agricultural fields at the university.

“This grant represents an exciting collaboration between the University of Arkansas and Tyson Foods,” said Charles Robinson, vice chancellor for diversity and community. “This investment has the potential to improve graduation rates and post-graduation outcomes for some of the most academically talented, underrepresented students in our state.”

Robinson said the scholarship is aimed to continuing students, instead of college freshmen, adding that it rewards students for their persistence and greatly enhances their likelihood of success.

The Tyson Inclusive Excellence Scholarship will support four cohorts of 15 students each. The cohorts will be supported through Diversity Affairs and the Center for Multicultural and Diversity Education as part of the Academic Enrichment Program as the Tyson Academic Enrichment Program Scholars.

“We’re glad to be a part of the University of Arkansas’ efforts to increase the graduation rate of underrepresented students,” said Ulanda Terry, director of diversity and leadership development for Tyson Foods. “It’s our hope that the Tyson Inclusive Excellence Scholarship will make a positive difference in many students’ lives, and their careers after college.”

Inventory issues continue to plague the nation’s larger retailer with some Wal-Mart stores carrying too much product while shelves are empty in other regions. The retailer has acknowledged its out-of-stocks as a $3 billion problem, but more recently top management vowed to address inventory overages.

“Inventory is an obvious problem in our stores. It’s growing too quickly. It’s like you’ve fit 4 pounds of sugar in a 2-pound bag when you walk our stores,” Walmart U.S. CEO Greg Foran told suppliers at the retailer’s recent Year Beginning Meeting held in Orlando (Feb 5-7).

Foran, who is new to the job and the U.S., said he doesn’t profess to know the landscape or cultural differences of various geographical regions, but he does know there is plenty of work to do in what he considers a long journey to right the course of Walmart’s biggest sector.

“I have visited about 70 stores over the past four months. Inventory is an issue, shrinkage has created challenges and we are leaning into this in a meaningful way. We can’t fix it all in five minutes. It’s going to take time but Judith (McKenna, chief operating officer for Walmart U.S.) and the team are working on it,” Foran said during the meeting.

Foran said in October that the company’s inventory has been growing at twice the rate of sales, and in some cases stores may only have room for 80 types of products and they are sent 120.

“More stock is coming in than what is going out. We are over-SKU’d in some cases,” Foran said. “Simplifying the inventory management process actions were started this year but it has continued to grow. I have a cross-functional team working on it.” 

A backroom manager in mid-Tennessee told The City Wire in June 2014 that his store was continually over-shipped on every thing from fishing pools to school supplies. He said the problem was growing worse in each of the past three years and negatively impacting that store’s profitability. Foran said these are the kinds of issues he has witnessed as he’s sprinted through dozens of stores across the country.

FORECASTING HITCHES
Supplier consultants with VendorMasters said some of the inventory problems are a result of problems with forecasting demand. They add that the new Retail Link 2.0 version now being tested does not fix the problem. Under the Informa system of Retail Link 1.0 there were ways to adjust quantities down to the store level. The new system uses historical sales data as its guide to replenishment, but for new products that have no historical sales data, that’s a problem.

The new system also seeks to serve 40 stores out of one distribution center, sending the same number of items to each of the stores, when some of the stores will sell more than others. Consultants say this leaves shelves empty in one store yet overstocked across town. Wal-Mart has not disclosed the number of suppliers now using the 2.0 Retail Link version, but they did say larger suppliers began testing it first.

In one case, a large food company with offices in Northwest Arkansas, had to place one of their replenishment managers inside Wal-Mart for six months to work out the kinks, which has caused some concern for smaller suppliers without those resources. Wal-Mart has been quiet with the media on the rollout of Retail Link 2.0 only to say it will be released slowly in clusters throughout this year.  

VenderMasters said suppliers are also concerned by new fines related to stricter “Must Arrive By Dates” imposed once a version to Retail Link 2.0 happens. Scott Crossett, a corporate recruiter with Cameron Smith & Associates, seconded that concern by suppliers noting that the added pressure has meant more turnover in replenishment manager jobs in the supplier community. He said that is now the job in most demand among the 80 to 90 openings his company sees daily.

FRESH FIX
Growing comp-store sales is the number one priority according to Wal-Mart Stores CEO Doug McMillion, but Foran said that starts with “fixing the shopping experience,” something on which he has told his managers to focus. He said that includes all aspects that go into a shopping experience.

Foran believes too many shoppers are not enticed to spend more time shopping in the fresh foods (produce) area, and he’s intent on fixing that part of grocery sales.

“It looks like we might be getting somewhat cluttered in ‘fresh.’ There is great opportunity here, but the last thing a shopper wants to do is trip over two pallets of Coca Cola or a display of Halloween candy in order to get to the fresh apples,” Foran said in October. “We have done a pretty good job with fruit, but we need to work on our vegetables. ... I think we may be carrying one, two or three days too much product in produce.” 

He also wants the stores to provide better meat and deli offerings. Wal-Mart said it’s most loyal customer only spends 40% of a fresh grocery budget with Walmart, and they want to capture more of that budget. Foran is working with David Cheesewright, CEO of Walmart International, on the best shared practices that could perhaps speed up the time it takes to “fix the shopping experience.”

All eyes are watching as Wal-Mart Stores will release its fourth quarter and fiscal 2015 earnings before the equity markets open on Thursday (Feb. 19.)

Parrot Island Waterpark, USA Truck money and the debate on how to insure Fort Smith’s estimated $240 million in assets are topics of this week’s video collaboration between The City Wire and Things To Do In Fort Smith.

This week’s report appears to be safe for viewing at work, and we have ordered a pair of pants for TV anchor Dawson Meadows.

Enjoy.

The annual Home Show presented by the Greater Fort Smith Association of Homebuilders will run from Friday, Feb. 20, through Sunday, Feb. 22, and this year, the community can expect a more active schedule to go along with increased building activities.

Stephanie Stipins, executive director for the association, said one of the biggest changes in store for 2015 is a name change to greater reflect the purpose of the three-day event. Instead of “Home Show,” it’s now “Home and Living Show,” because the association is “trying to get the community as involved as we can, and in addition to promoting residential construction, we’re trying to promote life in Fort Smith.”

The organization has picked a good year for the added emphasis as homebuilding activities have been up significantly over the same period last year. According to The City Wire’s latest building permit report, Fort Smith issued 129 residential construction permits in January valued at $6.344 million, up 37% compared to the $4.63 million in January 2013. For all of 2014, the city issued $40.73 million in permits for residential construction.

Stipins said factors like lower gas prices and an improving economy have people more comfortable with the commitment of owning a home.

“I feel like I can spend a little more money not putting so much in my gas tank, but I think people are feeling more comfortable being able to invest in a large purchase like a home, and many factors play into that,” she said. “It’s a plan — it’s a long-term plan — and I think that it’s indication that people are feeling more comfortable making a plan right now.”

Another indication that “people are ready to buy,” Stipins said, can be seen in the association’s annual Showcase Home, which is unveiled in the fall of each year.

“This house in 2014 was sold before it was finished,” Stipins explained. “Historically they sell within the first six months. This one sold before we even started telling anyone it was available. It sold in August, and it wasn’t open to the public until October, but the agreement with the buyer was they had to allow the public to view it as if it was never sold. So that is another good indication that people are looking to buy.”

The association plans to begin promoting 2015’s Showcase Home at this year’s Home and Living Show.

“It’s going to be located at the Burrows at Middleton at Howard Hill,” Stipins said of the next Showcase Home. “It will be our 27th home. We have a different builder every year. We go within our membership and request proposals from our members to be the one to provide us with that because it is a big deal. Other members provide product either at a discounted rate or comped, and so they begin promoting those products and in doing so they promote that house.”

Vendors are an important part of making the Showcase Home and the Home and Living Show successful, Stipins noted, adding that this year’s Home and Living will feature more than in year’s past with 145 booths, up from 117 in 2014, and 96 in 2013. “Less than 10” of these vendors will be banks or mortgage companies, in keeping with the theme of promoting life in Fort Smith as well as new home construction, she said.

Some of the activities at the Home and Living Show will include the following:
• LEGO contest for three age groups: 8 and under, 9-12, and 13-18;
• Find the Flamingo contest for gift cards to Pink Flamingo BBQ;
• Lowe’s Kids Build;
• Fingerprinting and carseat checks by the Fort Smith Police Department; and
• Educational seminars.

The full schedule of events as well as a listing of seminar topics and presenters for the Home and Living Show are available at this link.

Adult beverages are one of the faster growing categories at Wal-Mart Stores and one of the ways the retail giants seeks to woo Millennials. 

But Texas law prohibits publicly held corporations from selling hard liquor or spirits. Wal-Mart is opposing that law with a suit recently filed in federal court, according to reports from Bloomberg News.

“Our Texas customers want added convenience when shopping for adult beverages. However, the current law prohibits publicly-owned businesses such as Walmart from offering spirits to its customers. This is counter to Texas’ belief in free enterprise and fair competition, limits our customer’s choice and keeps the price of sprits artificially high, all of which harm Texas consumers. Walmart believes the law needs to be changed to provide a fair and level playing field so we can offer our customers a full assortment of adult beverages as part of a convenient and comfortable shopping experience.," Wal-Mart spokesman Lorenzo Lopez noted to The City Wire in an email.

Here’s what Wal-Mart said about its inability to sell us vodka, scotch and other adult spirits in an open letter dated Dec. 4 to the Beer Alliance of Texas:

“This restriction is not only unconstitutional, but also inconsistent with free market competition and consumer choice — principles in which Texans strongly believe and steadfastly support,” Gerard Dehrmann and Silvia Azrai Kawas, Wal-Mart vice presidents, noted in the letter.

Wal-Mart ran into similar roadblocks in Arkansas as its home state only allows one liquor store permit per company. Wal-Mart opened a liquor store in its Sam’s Club in Fayetteville. It sells beer and wine in its other facilities located in “wet” counties.

In Texas, Wal-Mart has gotten around the law by contracting with another company to open a liquor store that’s attached to Sam’s Clubs. The Dallas Morning News reports that in these instances the liquor stores must have a separate entrance and leases space from Sam’s Club.

Bloomberg reports that Wal-Mart told the distributor trade group, a powerful lobby in Austin, that it didn’t want to disrupt the state’s sales system and that it counted on “strong partnerships” with the companies.

The collaborative nature of the Bentonville/Bella Vista community, as well as all of Northwest Arkansas, seemed to be a theme at the 88th Annual Bentonville/Bella Vista Chamber of Commerce Banquet held Thursday (Feb. 12) evening at the John Q. Hammons Center in Rogers.

The banquet began with Shelley Parson, chamber board chair, discussing accomplishments in 2014 and goals for 2015. The 2014 highlights included creating the NWA Technology Council and the Technology Summit, establishing a task force to examine growth opportunities in Bella Vista, creation of the a Small Business Week Committee, the NWA Business Women’s Leadership Network, numerous legislative events, groundbreakings, and networking events.

So what’s in store for 2015? Parson said there are many plans, but highlighted several features such as growing the Technology Summit.

“It’s already off to a good start,” Parson said of the summit. “It could become not just a signature event (for the chamber) but a world-class event.”

The chamber will also continue efforts to revitalize parts of U.S. 71, including an emphasis on the North Walton corridor. She cited a recent announcement about eight banks investing in revitalizing commercial business district.

“Northwest Arkansas has so much growth and potential and right now 71 doesn’t represent that,” she said. “This will be a big plus not just for the city (of Bentonville) but also for economic development.”

Parson also spoke of growing the chamber. The chamber gained 234 members in 2014 compared to 176 the year before.

The banquet also featured a conversation with Don Bacigalupi, the founding executive director for Crystal Bridges Museum of American Art. He recently accepted an appointment as the founding president of the Lucas Museum of Narrative Art, which is being built in Chicago. He will remain on the Crystal Bridges board.

Bacigalupi was interviewed by Sandy Edwards, museum deputy director. Bacigalupi and Edwards agreed there was a great deal of skepticism about the museum among the art community before Crystal Bridges opened. Now, many of the initial naysayers admit that some of their negative comments came from jealousy because arts patron Alice Walton was investing so much into a new museum and in a place where most had never thought of a fine arts museum being located, Bacigalupi said.

“There was so much positivity here that I almost forgot the negativity elsewhere,” he said.

The museum creators were astounded at how well the Northwest Arkansas community embraced the museum, including high numbers of volunteers and attendance once the museum opened.

“We would have felt good if we had 200,000,” Edwards said. “But we had 650,000 that first year.”

Bacigalupi said in the earlier years of Northwest Arkansas, the community had to bind together to survive and that spirit continues even now that the region is considered successful. He also spoke of the “collaborative spirit” that Northwest Arkansas uses when tackling problems and making advancements in the community, adding that issues are approached “in a thoughtful, intelligent and well-organized way.”

The banquet ended with annual awards being presented. The winners were:
• Spirit Award: Suzanne Nichols
• Ambassador of the Year: Nancy Morgan-Kalish
• Teachers of the Year: Kory Price, Greg Puckett, Sheila O’Neal, Ashleigh Dewey
• MainStreet Award: SourceGas
• WalStreet Award: Acosta
• R.E. Buck Award: Rob Brothers
• Arthur (Rabbit (Dickerson) Award: Dr. Don Cohagan

Mars Petcare is planning an $81.7 million expansion of its facility at Chaffee Crossing that will add an estimated 95 good-paying jobs, according to information with a “Tax Back” resolution on the Tuesday (Feb. 17) agenda of the Fort Smith Board of Directors.

It’s the second significant expansion of the plant in the past two years. Mars Petcare – based in Brussels, Belgium, with a U.S. headquarters located south of Nashville, Tenn. – opened the Chaffee Crossing site in September 2009. In October 2013 the company announced a $50 million expansion that was expected to add 42 jobs.

Mars Petcare announced November 2007 it would build an $80 million pet food plant at Chaffee Crossing and employ 200 full-time workers when the plant was fully operational. At the time of the announcement, the city of Fort Smith estimated the plant would result in an annual payroll of $7.07 million, with the average annual salary around $35,300. The company received $2.2 million from Gov. Mike Beebe’s quick-action closing fund, and other state incentives that totaled more than $19 million — with many of the incentives rewarded only when Mars begins hiring. The city of Fort Smith agreed to drainage upgrades near the plant site that, according to estimates in late 2007, could cost up to $1 million.

The “Tax Back Endorsement” the Board will consider Tuesday is a formality as part of an incentive program administered by the Arkansas Department of Economic Development. The program allows businesses to seek refunds of sales taxes on construction materials, new equipment and other qualifying expenses of investments that result in new jobs.

“The current request is on behalf of Mars Petcare US, Inc., who plans to expand its current pet food production facility located in Fort Smith at 10000 Roberts Boulevard by investing $81,700,000 in new equipment and renovations to existing buildings. This expansion will add 95 new jobs to the region with an average wage of $21.17/hour, increasing Mars Petcare’s local employment by 90%,” noted a Feb. 12 memo from Deputy City Administrator Jeff Dingman to City Administrator Ray Gosack.

The new manufacturing jobs will certainly help. The Fort Smith area manufacturing sector employed an estimated 17,900 in December, up from 17,800 in November, and below the 18,400 in December 2013. Sector employment is down almost 37% from a decade ago when December 2004 manufacturing employment in the metro area stood at 28,400. Annual average monthly employment in manufacturing has fallen from 28,900 in 2005, 19,200 in 2012, and to 18,300 in 2013.

The Mars Petcare division employs an estimated 35,000 people with operations in 50 countries. Well known brands include Whiskas, Pedigree and IAMS.

PETCARE INDUSTRY GROWTH
The U.S. petcare industry continues to grow, and saw growth through much of the recent recession. Estimated 2014 pet industry sales in the U.S. were $58.51 billion, according to the American Pet Products Association, up over the $55.72 billion in sales during 2013. The 2014 estimate is up more than 21% compared to 2010 sales.

Of the estimated $58.51 billion in 2014 sales, $22.62 billion is for pet food.

A report from animal and pet expert Clarice Brough indicates the industry will grow at an annual rate of 4% beyond 2014.

“Going forward, growth in the pet industry is projected to be 4 percent annually through 2018. In the next five years, pet operations are projected to maintain strong growth. The number of households owning pets is expected to continue to increase along with an increase in discretionary income as the economic recovery takes hold. These two factors combined will continue to bolster the demand for premium products, foods and pet services,” Brough wrote.

Just six months after rolling out Savings Catcher and telling customers there is no reason to compare everyday low prices against Wal-Mart, the retail giant notified users of new restrictions as of Feb. 14.

Savings Catcher users were notified of the changes in an email on Feb.13, in which Wal-Mart thanked customers for using the savings tool but also noted a few changes to the program.

“Beginning Feb.14, we are removing some departments consisting mostly of items that do not have a like for like match at other retailers, such as produce and bakery items. Additionally, we are limiting our comparisons to offers of other mass market retailers, grocery and dollar stores, removing comparisons with drug stores,” the email stated.

Wal-Mart corporate spokeswoman Danit Marquardt told The City Wire that updates to Savings Catcher focus on grocery and consumable items that make up significant portions of customers’ weekly shopping stock up trips. She said Savings Catcher matches will continue to cover pantry staples, dairy products (like yogurt), cleaning supplies, health and beauty aids and over-the-counter medications.

Produce and bakery items as well as weighed meat do not have consistent uniform product codes (UPC) between retailers, which is why Wal-Mart said it will no longer match against competitor prices. Wal-Mart also said it opted not to continue matching against drug store competitors like Walgreen and CVS because that is not the channel most used for weekly stock up grocery shopping.

EARLY SUCCESS
Wal-Mart first unveiled Savings Catcher in March 2014, testing in a few markets before rolling it out it August and expanding it to include some toys during the holiday season. The retailer said in September it had returned $2 million to shoppers who were using the savings app. Wal-Mart declined to say how it planned to report these savings at year-end. The retailer does not allow shoppers to carry savings from year-to-year, noting that gift cards would be sent to those at year-end for the savings catcher balances.

A $599 annual limit was imposed on the Savings Catcher program per customer, according to the new guidelines found on the retailer’s website.

Analysts like Carol Speickerman, CEO of newmarketbuilders, have praised Wal-Mart’s Savings Catcher noting that it “adds a new dimension to its price match guarantee while continuing to make it incumbent upon shoppers to take the initiative. Wal-Mart can satisfy shoppers who are truly price sensitive and message value and price transparency to everyone else without lowering prices across the board. It offers the best of both worlds.”

Analysts with Cleveland Research had this to say about Savings Catcher” “It’s basically the same thing as the Ad Match Guarantee but it takes the work out of the hands of the consumer.”

PERCEIVED IMPACT
Restricting the program is not likely to have a big impact among avid users, according to some retail experts. A recent study by IRI found that 41% of consumers routinely shop multiple retailers to ensure they get the lowest prices. Sue Viamari, a retail expert with IRI told The City Wire that shoppers who are price sensitive do not mind shopping multiple retailers where they perceive they are getting consistent values.

“This shift in behavior began during the economic downturn and consumers have stayed with it. This is no longer a one solution fits all world” Viamari said.

Deep discount retailers like Aldi win favor by those shoppers looking for lowest fresh produce and dairy prices. For instance, Avocados were featured recently by Aldi for 29 cents each. Wal-Mart’s featured price of 59 cents that same week was 100% more expensive than Aldi. With the latest changes Savings Catcher will not capture that difference. Experts and shoppers recently interviewed say people who shop Aldi do so because they know they can get the lowest price on whatever produce the smaller retail is offering that given day, even if it’s on sale elsewhere.

Viamari said consumers are creatures of habit adding that they adopted several shopping strategies out of necessity when the economy was weaker, but in doing so they found out who has the best prices and consistent quality on the things they want. She said convincing them otherwise is no easy task.

Walmart’s new U.S. CEO Greg Foran has vowed to fix the “fresh” problem at Wal-Mart noting that he’s troubled when he sees too many shoppers walking past the fresh produce department to purchase items in the center of the store.

Southeastern Freight Lines, a provider of regional less-than-truckload (LTL) transportation services, promoted James Williams as the service center manager of the Fort Smith offices.
 
In five years with Southeastern, Williams has served in a variety of roles, including outbound supervisor, outbound operations manager, inbound operations manager and assistant service center manager.
 
“As a key member of the Southeastern team, James has proven to be a valued leader who upholds our company culture and always works to provide top-quality service to each customer,” said David Turner, regional vice president of operations, Southeastern Freight Lines. “We are excited to welcome James to the Fort Smith team and are confident his leadership skills and experience will be a great asset in his role as service center manager.”
 

Activity at the Northwest Arkansas Regional Airport (XNA) and the Fort Smith Regional Airport continued the gains posted in 2014, with January enplanements up at the two commercial airports.

XNA had 44,431 enplanements in January, up 6.85% compared to January 2014. The enplanement level also set a new record for January traffic at the airport. The previous record was 42,088 in January 2011.

The airport is served by five airlines that provide connections to 10 U.S. cities.

XNA ended 2014 with 640,537 enplanements, up 10.15% over 2013, and more than the record of 598,886 enplanements in 2007. The 2014 gain also marked the third consecutive year of increased traffic at the airport. XNA’s first full year of traffic was 1999, and the airport posted eight consecutive years of enplanement gains before seeing a decline in 2008.

January enplanements at Fort Smith totaled 6,920, up 1.43% over January 2014. The airport offers flights to Atlanta and Dallas-Fort Worth through Delta and American Airlines. American had 4,459 enplanements in January out of Fort Smith, or 64.4% of the total. The percentage is up from 60.1% in January 2014.

Enplanements at Fort Smith totaled 92,869 in 2014, up 9.87% compared to 2013. For all of 2013, enplanements at the airport totaled 84,520, down 2.46% compared to the same period in 2012.

The Bill & Hillary Clinton National Airport in Little Rock was the only one of Arkansas’ largest commercial airports to not post an enplanement increase in 2014. Enplanements in 2014 totaled 1.038 million, down 4.32% compared to 2013. (The airport did not have January data available as of Feb. 16.)

Little Rock enplanements in 2013 totaled 1.085 million, down 5.45% compared to 2012. Enplanements in 2012 totaled 1.147 million, up 4.07% compared to 2011. The 2012 numbers ended five consecutive years of enplanement declines at Arkansas’ largest commercial field.

The most recent federal data – U.S. Department of Transportation – show 59.903 million enplanements in the top 100 U.S. airports between January and November 2014, up 3.24% compared to the same period in 2013.

ENPLANEMENT HISTORY (Fort Smith Regional Airport, since 2000)
2014: 92,869
2013: 84,520
2012: 86,653
2011: 86,234
2010: 86,129
2009: 78,432
2008: 87,030
2007: 99,127
2006: 94,717
2005: 102,607
2004: 92,928
2003: 90,493
2002: 87,944
2001: 95,419
2000: 104,182

ENPLANEMENT HISTORY (Northwest Arkansas Regional Airport, since 2000)
2014: 640,537
2013: 581,487
2012: 565,045
2011: 562,747
2010: 570,625
2009: 540,918
2008: 571,845
2007: 598,886
2006: 586,320
2005: 583,940
2004: 511,714
2003: 448,228
2002: 400,063
2001: 374,122
2000: 367,157

Investors seeking bargain prices in an improving real estate market helped push home sales higher in the Fort Smith metro area in January. Stronger consumer confidence and temperate weather also meant more sales for agents.

There were 83 homes sold in Sebastian County in January, with 62 of those in Fort Smith, according to Kevin King, broker with Weichert King Realty Group. He said 11 of those 62 sales were priced below $75,000, an indication that investors are still active in the local market.

MountData.com reports the 83 homes sold in Sebastian County in January were valued at $10.472 million, which was a 10.6% gain in units sold and 12.3% more volume over the same month last year. Unit sales are up 59% from the same month in 2013 while total sales volume rose 65%.

King said January weather was better than predicted this year which does tend to positively impact sales. But equally important, King attributes the better sales to improving consumer confidence which is at its highest level in several years.

“Our listings were up 30% in January, which an indication there is more confidence about the local market. There are 580 listings in Fort Smith, out of the total 820 listings for Sebastian County.

The median prices for homes sold in Sebastian County last month were $111,225, or $67 per square foot, according to MountData.com. The average sales price was  $126,170, up slightly from $124,247 reported a year ago.

In Fort Smith, King said the average home price was $128,300 in January, noting that more activity at the low end of the market reduced the average price. He said the average price for homes sold by his office last month was $185,000, which was one of their better months.

CRAWFORD COUNTY
Crawford Country total home sales in January were valued at $3.656 million, down 5.9% from the same month last year. Agents sold 35 homes, which was 3 less than were sold in January 2014, according to MountData.com.

The median home price in Crawford County was $104,950, or $65 per square foot. This was up 17.2% from the $89,500 median price reported in the year ago period. Federal Rural Development loans which allow for 100% financing have been a contributor to the appeal for Crawford County among first-time homebuyers. 

Van Buren, the largest city in Crawford County, was among those eliminated from Rural Development loans as of October 2014. King said this will likely mean fewer sales for Van Buren going forward by those homebuyers needing the 100% financing.

Mortgage bankers said interest rates are still low and the recent reduction in mortgage premium insurance is making home affordability possible for those who can muster the 3% downpayment, which can be a gift from family.

JANUARY DATA
Home Sales (January)
Sebastian County
2015: 83
2014: 75
2013: 52

Crawford County
2015: 35
2014: 38
2013: 27

Home Prices (January)
Sebastian County - average sales price
2015: $126,170
2014: $124,247
2013: $122,045

Crawford County - average sales price
2015: $104,483
2014: $102,359
2013: $100,394 

Home Sales total value (January)
Sebastian County
2015: $10.472 million
2014: $9.318 million
2013: $6.346 million

Crawford County
2015: $3.656 million
2014: $3.889 million
2013: $2.71 million