AMERICA'S MOST SUCCESSFUL MERCHANT Having built a retailing colossus, Sam Walton can now do what he likes. That's why he's out there every day making sure they still do it the Wal-Mart way.

(FORTUNE Magazine) – IN HIS ENTIRE LIFE, Sam Walton -- youngest Eagle Scout in Missouri, state champion high school quarterback, student council president, fierce tennis competitor, Army officer, small-town five-and-dime merchant, and founder and chairman of America's biggest retailer -- has probably failed miserably at only one thing he ever attempted: retirement. He tried it a few years back, leaving Wal-Mart to be run by highly paid professional managers, but it just didn't take. Which is why he's up here today behind the stick of his twin-prop Cessna, dodging thunderheads in search of that little strip of asphalt they call the airport somewhere down below in Holly Springs, Mississippi. Having accumulated all the wealth and achievement anybody could ever need in one lifetime, Sam Walton is now in a position to do exactly what he wants. So we are doing the thing he loves best in life -- even more than quail hunting, to which he devotes about four months of each year: We are barnstorming the heartland, visiting Wal-Mart stores at a pace that leaves younger, healthier men panting when they reach whatever inevitable Holiday Inn happens to be closest to the last store visit of the day. The plane pops out of a cloud, and Sam spots the airstrip. He grabs the levers to adjust the throttles and fuel mix as we swoop groundward. ''We never could've put all this together without these airplanes,'' he says over the roar, proudly noting that he bought this particular plane secondhand from some bankrupt investment banker. ''Plus, I really, really enjoy the flying. I like the challenge. But mostly I like the independence of being able to go where I want to when I want to -- in a hurry.'' His landing is matter-of-fact and perfect. He taxis over to the little shed where several Wal-Mart ''associates'' await his arrival -- having received word about 45 minutes ago that he was on the way from the last store he visited. One woman in the greeting party loses her composure when she sees that Sam really is here. Her jaw drops as if to catch flies, and by way of greeting the chairman when he steps off the plane, she says over and over, ''We're just dumbfounded. We're just dumbfounded.'' Part of this reaction is because it has been about a decade now since Sam Walton could honestly make one of his favorite boasts: that he personally visits every Wal-Mart store at least once a year. The creation has simply outgrown the creator; nobody could visit 1,650 stores plus 200 Sam's Clubs and still get around to the 150 or so store openings Wal-Mart holds every year. ''Right now there are probably about 30 stores I've never been to and a bunch of others I haven't seen in more than a little while,'' he says. ''I've got to get to 'em soon. I'm going to our first store opening in New Hampshire next week, and on the way I'm going to hit a store I've never been to up in Toledo.'' Sam's appearance out here on the road inevitably provokes dropped jaws, double takes, and downright embarrassing behavior for other reasons as well. First, there's that ''richest man in America'' label, which Sam truly hates and sincerely wishes for all the world had been awarded in perpetuity to some jackass who really wants it. ''All that hullabaloo about somebody's net worth is just stupid,'' he says, ''and it's made my life a lot more complex and difficult.'' Because he's done everything he can to avoid personal publicity and media attention over the years, he's taken on a bit of the aura of a Howard Hughes-recluse billionaire, which is silly when you consider that all you have to do to meet the man is go hang around the lunch counter at any Wal- Mart, and sooner or later he'll show up. If you're lucky, he might autograph your dollar bill (he hates this but usually does it anyway) or let you snap a picture of him and your baby with the Kodak Disc camera you just bought from Wal-Mart. Or he might steer you to a particularly good bargain on some item that he personally suggested Wal-Mart buy a bunch of and promote -- like a 13 1/2-ounce bag of Brach's chocolate peanut clusters for $1.50. Another cause for all the stir is that a lot of people don't really believe the Sam Walton story. Cynics think he must be some sort of elaborate public relations fabrication, while the real man actually hangs out at Lutece with his billionaire buddies and jets around the country in the pampered care of liveried retainers, peddling cotton socks to the suckers and laughing all the way to the Swiss banks. So sometimes the guy pumping gas at the Branson, Missouri, airport, or the woman working the night desk at the Batesville, Arkansas, Ramada can be forgiven for rattling a little bit when this slight, white-haired old man appears in front of them wearing a baseball cap and his magnetic Chuck Yeager ''right stuff'' smile. ''Hi there,'' he says. ''Sam Walton. Could you gas my plane up while we're in town?'' or ''Could you sell us a couple of rooms for the night?'' Like everything else about Wal-Mart, the overhead on these barnstorms is at the bone; there is no entourage -- no backup pilot, no secretary, no assistant, no limousines. On this trip he is accompanied -- except for the confounded magazine writer and photographer -- by just two young buyers from Wal-Mart headquarters in Bentonville, Arkansas. They are here to fill two perfectly good free seats that will take them to where Sam thinks they ought to be anyway: out in the stores, seeing for themselves how all that stuff they buy sells in the real world, and listening to the complaints and suggestions of Sam's favorite folks -- the hourly-wage Wal-Mart associates who stock the shelves and wait on the customers. FINALLY there is the very real issue of Sam's mortality. A lot of folks are surprised to see him out here looking hale and hearty these days because they assumed he was on his deathbed. Now 73 and fighting a bone cancer diagnosed as incurable, Sam Walton surely knows that he is in the twilight of his career, that he can't do this forever. If so, he never lets on. He has, he admits, considered his own mortality and decided a couple of things. First, if he had it to do all over again, he wouldn't change a thing. Second, in whatever time he's got left, he is not about to kick back, congratulate himself, and let some sly devil like that Dayton Hudson discount chain, Target, sneak up behind him. No, Sam is going to do it exactly the way he's always done it. And though he never likes to take personal credit for anything, he is willing to admit to being a ''pretty fair merchant'' who can still help teach some of his less experienced associates a few tricks of the trade. He will not, however, have any eulogizing before he's gone, and he certainly will not let on to any of his 345,000 Wal-Mart associates that it is harder for him these days, that the bone pain is tough and sometimes discouraging. But cancer has stalked aplenty through the lives of the Wal-Mart associates, and they know; you can see in the eyes of some of the older ones that they think this may be the last time they see their chairman and hero. So when he + visits, they hug and squeeze him a lot, and when he walks out the door, more than a few pull out their hankies and dab at the corners of their eyes. This is then, in a sense, the unannounced, indefinitely running farewell tour of Sam Walton, America's undisputed merchant king of the late 20th century. The real story of how Sam opened his first Wal-Mart store at age 44 and from there built America's largest retailer, pushing $40 billion in annual sales, is, as you would expect, multifaceted. It comprises 29 straight years of good business judgment, and while the cheerleading Sam Walton as seen on tour is the one who led the way, he wasn't the only Sam Walton involved. There is the gutsy Sam Walton who borrowed up to his eyeballs from most every bank in Arkansas, sometimes just to pay back other banks. Today that Sam Walton owns a few of his own Arkansas banks, and his company recently borrowed $1 billion for real estate development with hardly any notice. There is the shrewd Sam Walton who for many years prowled the New York and Chicago markets buying merchandise for his stores; that Sam can't understand how Wal-Mart can possibly need all of the 165 buyers it employs today. That same Sam Walton couldn't get any of the big distributors to call on him at his remote lair in Bentonville -- pretty near the geographic center of the lower 48 -- so he plotted a growth strategy of concentric circles emanating from Bentonville, and as the circles grew he supplied them with his own huge distribution centers and truck fleet (now one of the largest over-the-road fleets in America). THEN there is the frustrated Sam Walton who, in the early going, tried to borrow several million dollars from the big insurance companies but was rejected and forced instead to sell stock to the public. That Sam Walton, of course, became fabulously wealthy off the stock (Walton family holdings today are valued at $21.1 billion). And there is the executive Sam Walton who, to maintain control of his company's explosive growth, hired heavyweight managers and, in his own torturous way, let them persuade him to invest heavily in such overhead as leading-edge computer equipment. This executive Sam still gets up every Saturday around 3 A.M. to pore over up-to-the-minute weekly sales printouts spewed out by those computers, looking for opportunities or trouble spots. Sam the executive not only has hired top talent but has bid farewell to more than a few senior managers who perhaps grew weary of the self-sacrificing lifestyle demanded by the Wal-Mart way, or who maybe forgot for a moment who's really in charge. There is also Sam Walton the motivational genius, who understood that all his cheerleading and backslapping and sloganeering would go only so far with the folks who stand on their feet all day in the piece goods department and go home at night to a hungry husband and three kids. That Sam gave everybody a piece of the action. Through profit sharing, incentive bonuses, and stock purchase plans, the folks who handle the goods and the customers have a direct stake in doing it the Wal-Mart way. And finally, there is the ruthless, predatory Sam, who stalks competitors -- in any size, shape, or form -- and finds sport in blasting them from the sky like so many quail.

Don't misunderstand. The touring Sam Walton, who rises before dawn every day and drops into stores to drink coffee with the night receiving crew, to pump up the associates, to listen to customers, and -- without fail -- to look over the books, isn't just some showbiz gimmick, no matter how closely he sometimes resembles P. T. Barnum. This is Sam Walton: merchant-pilot. And when it's all said and done, this is the man in whose presence Sam Walton, the man, is most comfortable. It is this Sam Walton who has done the most to create and sustain Wal-Mart's phenomenal success by injecting an almost inexplicable merchandising magic into what could have been just another chain of drab discount stores. Says Sam: ''This is still the most important thing I do, going around to the stores, and I'd rather do it than anything I know of. I know I'm helping our folks when I get out to the stores. I learn a lot about who's doing good things in the office, and I also see things that need fixing, and I help fix them. Any good management person in retail has got to do what I do in order to keep his finger on what's going on. You've got to have the right chemistry and the right attitude on the part of the folks who deal with the customers.'' There is precedent for the visits. Sam still remembers being on the job as a young man at a J.C. Penney store in Des Moines when James Cash Penney himself dropped in for a visit: ''He taught me how to tie a package with very little twine and very little paper and still make it look nice.'' No one knows exactly how Sam decides to visit which stores when, and if there is a plan it certainly isn't written down anywhere. This morning, store No. 950 near Memphis learned that Sam was coming when he strolled up to the locked storefront around 7 A.M., pulled his constant companion -- a microcassette recorder -- from the breast pocket of his plaid sports jacket, and began banging it on the window for attention. An ''Oh my God'' expression quickly flashed across the face of the first associate to recognize the old guy in the Wal-Mart ball cap trying to get in. Everyone, including Sam, wears a badge with first name boldly displayed, so everything is always on a first name basis. ''Good mornin', Mr. Sam, welcome to Memphis,'' says Doug. ''Good mornin', Doug, great to be here,'' says Sam. ''I want to walk around a little bit, and then we'll get everybody up front. But I'd like to get all your department heads and assistant managers up here in the snack bar, and I'd like to see your P&L and your merchandising statements, and I want to see your 30-, 60-, and 90-day plans. All right?'' Then, as if he owned the place, he starts strolling around the store. ''Hi, Bill, what do you do?'' he says. ''Hi, Mr. Sam. I'm over in the new auto center. We really want you to come look at it. We're real proud of it.'' ''Are these things ((new lubrication centers designed to compete with quick oil-change franchises like Jiffy Lube)) going to work, Bill?'' ''Yes sir, Mr. Sam. They're going to be great.'' ''Good, good,'' says Sam. Moving along toward the pharmacy, he says, ''Hello, Georgie. I like this Equate Baby Oil here for $1.54. I think that's a real winner.'' ''That's my VPI ((volume-producing item)),'' says Georgie. Sam whips out his primary tool of empowerment, his tape recorder. ''I'm here in Memphis at store 950, and Georgie has done a real fine thing with this endcap display of Equate Baby Oil. I'd like to try this everywhere.'' Georgie blushes with pride. A manager rushes up with an associate in tow. ''Mr. Walton, I want you to meet Renee. She runs one of the top ten pet departments in the country.'' ''Well, Renee, bless your heart. What percentage of the store ((sales)) are you doing?'' ''Last year it was 3.1%,'' Renee says, ''but this year I'm trying for 3.3%.'' ''Well, Renee, that's amazing,'' says Sam. ''You know our average pet department only does about 2.4%. Keep up the great work.'' Sam strolls over to a cashier's stand and picks up a speakerphone -- the kind normally reserved for ''I need a price check in hardware'' -- and with no introduction calls everyone to the front of the store. ''Northeast Memphis, you're the largest store in Memphis, and you must have the best floor-cleaning crew in America. This floor is so clean -- let's sit down on it. ((Everyone sits, and Sam crouches on one knee, like a coach designing a play in overtime.)) I thank you. The company is so proud of you, we can't hardly stand it. On top of everything else, you went through the trauma of remodeling and still came through with 0.8% shrinkage. ((Because the shrinkage, or unaccounted-for loss of inventory, is so low, everyone in the store has recently received a bonus check of several hundred dollars.)) Could you use those checks? Were they helpful? Good. ''But you know, that confounded Kmart is getting better, and so is Target. So what's our challenge? Customer service, that's right. Are you thinking about doing those extra little things? Are you lookin' the customer in the eye and offering to help? You know, you're the real reason for Wal-Mart's success. If you don't care about your store and your customers, it won't work. They like the quality and they like the attitude here. They like that we save 'em money, don't they? And they say, 'Hey, something's different about Wal-Mart.' '' Now he asks, ''How many of you own Wal-Mart stock?'' Most hands go up. ''Well, I hope you realize we're just getting started,'' says Sam. ''But we've got to continue to improve. You're up over 8% ((for the year)) at this store. I wonder if you can continue. We'd like to see 10%.'' Then, of course, comes the traditional Wal-Mart cheer: Give me a W! Give me an A! And so on. Later, in the snack bar with the managers, Sam's trained eye stops on the spreadsheet at Department 16: lawn and garden. ''Sixteen's just not as good as it ought to be,'' he says. ''Is there a Home Depot settin' around here somewhere?'' His tour of store 950 complete, Sam heads out for his next stop in Memphis, a Sam's Club. In the car he elaborates on one of his favorite Wal-Mart concepts, called store within a store. ''What sets us apart is that we train people to be merchants,'' he says. ''We let them see all the numbers so they know exactly how they're doing within the store and within the company; they know their cost, their markup, their overhead, and their profit. It's a big responsibility and a big opportunity. You give a pet department to somebody like Renee, and she gets at it. She learns that what's important is buying stuff four gross at a time and then selling four gross. Nobody gets anything out of just standing there going through the motions.'' With two store visits already under our belts now, it's only about 8:45, and we're at the Memphis airport. Sam pauses to dip into a little cooler for the mixture of vitamins, herbs, and grains he drinks as part of a homeopathic complement to his conventional chemotherapy treatments. And we're off to Holly Springs for that quick store visit. Then we climb back into the Cessna and fly to Savannah, Tennessee, where Sam takes a group of hourly associates -- no management -- to lunch at a local roadhouse. As they dig into their pie, he digs into Wal-Mart bureaucracy. ''We're gettin' just like Sears Roebuck in some ways,'' he says. ''We got so many back office people workin' off the floor, not doin' a thing to help our customers.'' He glares toward the two buyers in his tow today -- one from stationery, one from sporting goods -- and says, ''It's hard to believe we have one buyer just to buy Big Chief tablets and another just to buy tennis balls. We used to have one buyer for five departments.'' At store after store, he pounds away on this theme. ''I'd like to see the buyers come into the stores and sell one day a week,'' he says to one store group. ''That'd put their noses in it. They get these big egos and start acting like the cock o' the walk when these conmen salesmen tell them how great they are.'' Always, in settings such as this, he asks the associates if they like their store manager or their district manager. If the answer is lukewarm, he notes it later on his tape recorder. If it's outright negative, he doesn't mind saying to them, ''Don't worry, I'll kick his butt.'' NOW the afternoon is wearing on, and we are flying at about 15,000 feet over Arkansas, headed for Batesville, where Sam wants to visit a brand new Super Center, a big, wide-aisled Wal-Mart with the addition of a full grocery store on one end. As is the routine, we are flying on automatic pilot while Sam sifts through mail and piles of spreadsheets, leaving someone else to watch the skies. Conversation is spare, and it's easy to tell he'd rather be up here alone, as he was a few weeks ago when he flew to California, visiting 26 stores in ten days along the way. At one point, though, he looks out the window to the left and says, ''That's Newport down there, where Helen and I first started out. That's where we had our first Ben Franklin store. If it had been up to me, we'd have been in St. Louis, but Helen just put her foot down and refused to live anywhere with more than 10,000 people.'' ACTUALLY, Sam's memories of Newport, Arkansas, are somewhat bittersweet. Young Sam was the consummate small-town merchant -- ironic today in light of most small-town merchants' fear and loathing of Wal-Mart -- and he built the Newport store into a powerhouse operation in just a couple of years. But after five years Sam's landlord refused to renew his lease, and Sam was encouraged to sell the store to the landlord's son. In effect, Sam Walton was kicked out of Newport. He says he remained friends with the landlord and didn't harbor thoughts of anything like revenge. But after that episode, and after landing in Bentonville, Sam never again put all his eggs in one basket. He quickly spread his variety stores around from town to town. And when he opened Wal- Mart No. 18, it was in Newport. As a postscript, Sam notes that the landlord's son's Ben Franklin went out of business. Not one who looks back often, Sam quickly snaps out of this reverie and gets back to his spreadsheets. For some reason, Sam's reception at the Batesville Super Center borders on the hysterical. Folks are honking their horns and yelling ''We love you, Sam'' from their cars, and the autograph hounds are particularly pesky. A drunk approaches him and wants him to go into the insurance business with him. Sam politely declines, but he is feeling good, and he obliges everybody for a while. Strolling the aisles of the food store, he notices the incredibly low prices -- milk for 99 cents a gallon, bananas 19 cents a pound, a loaf of bread for 15 cents -- and asks a manager what's going on. Kroger has responded to Wal-Mart's arrival in the grocery business with a price war, he is told. His eyes twinkle at that, and we are off to Kroger.

Here Sam inadvertently shows us how one of his magic tricks works. By simply removing his ever-present Wal-Mart baseball cap and badge, he suddenly becomes anonymous. At the same time, some of the folksiness disappears. He is just a handsome, distinguished-looking senior citizen shopping for a few items in the Kroger; no one gives him a second look. ''Uh oh, look at that,'' he says. ''Their milk is 79 cents. We've got to fix that right now.'' Then he buys a pound of bananas and departs. As we leave town the next morning, Wal-Mart is advertising 69-cent milk. The next stop, on the third day of what turns out to be a four-day jaunt, is store No. 5, in Conway, Arkansas, whose special place in Sam's heart is evident by the way he cuts loose with these folks. If Sam really likes somebody, he usually slaps him or her with his notebook or his yellow legal pad -- hard -- after they've said something, and he's hitting everybody in Conway today. ''Oh boy, we've written a lot of chapters here,'' he says. ''Lord, you folks certainly have this store standing tall. Ethel, do you remember that old store we opened here 25 years ago? It was an ugly old thing, wasn't it? Vida, how long have you been here? Twenty-four years -- hmmm. Jeanette, did you ever dream you could manage a $3 million department on your own? How much is your profit sharing now? Don't even say it out loud. Don't you feel this is a confounded miracle? It had to be a miracle.'' Then: ''I'm proud of what we've accomplished, but I do not like hearing we're the biggest retailer in the world. I don't want Wal-Mart going soft. Do you? ((In the background, country music star Garth Brooks's ''Two of a Kind, Workin' on a Full House'' plays softly.)) I know your backs are sore, and your feet hurt, but this is one of the very best Wal-Mart stores in the U.S., and no other store's had this much fun. Has sharing the profits with you made a difference? ((A deafening YES! here.)) A lot of companies would have shared them with the stockholders, but as you know, we don't pay much dividend.'' So this is how the tour goes, all day, every day that he can get out. It's been a long haul for Samuel Moore Walton, a lifelong achiever. As a teenager he dreamed of becoming President of the U.S. As a young college graduate just out of the Army, he aspired to an MBA from the Wharton School. But practicality intervened, and he settled instead for a job at an Iowa J.C. Penney store on a salary of $85 a month. From that moment on, it seems, he has been inexorably pushing the very concept of retailing to its limits, always experimenting, promoting, changing. As he says of Wal-Mart, ''We're not that smart, but we do change, and we are flexible. We are able to turn our big ship around a lot quicker than most people think we should be able to, because our guys have always been so attuned to change.'' The result, of course, is that he -- and a handful of other entrepreneurial new-age retailers such as Leslie Wexner of the Limited, Charles Lazarus of Toys ''R'' Us, Bernard Marcus of Home Depot, Sol Price of Price Club -- has sailed the whole retail industry into previously uncharted waters and left the old industry giants sitting on the shore wondering where everybody went. IF SAM hasn't enjoyed most every minute of it, he certainly has managed to create that impression, and if he is ever discouraged, only his family knows about it. In trying to define the secret of his remarkable journey to the stratosphere of commerce, several words pop up: optimism, energy, guts, charisma. But the real secret of Sam's genius may simply be focus. With his antics and his wild rhetoric and his sly sense of humor, he often gives the impression of being a bit scatterbrained. He loses pads and pencils and lists and appointments. He misplaces keys and maps and telephone numbers. But his mind, like his flying, is considerably more organized than it appears. No one in the history of business could possibly have pursued a vision with more single-minded focus than has Sam Walton, which is why -- in the twilight of his life -- he's still at it. It's why he's up on stage now in front of a giant American flag at the grand opening of a Sam's in Marion, Illinois, which rather immodestly calls itself ''The Hub of the Universe.'' It's why he'd rather be singing ''I've Been Working on the Railroad'' to the assembled mass of new customers, mostly coal miners, than hanging out with the rich and famous. And it's why, when he's finished leading everyone in a rousing chorus of ''God Bless America'' and the band has died down, he just can't help adding into the microphone: ''Okay everybody, let's hear those cash registers ring.'' Because Sam is always focused on that, the sweetest song he's ever heard.