I believe Walmart does this at Target also...I remember my boss chasing Walmart employees out of store once for copying price information. At the time I was under the impression they were logging the prices for specific items manually on a checklist they had brought, so maybe the scaanners are a new thing?

For what its worth, when I worked at K-Mart (oh so many years ago pre-bankruptcy) our department managers did the exact same thing at the local Walmart. Except 1) they used mere pencils and paper and 2) they only checked prices on a handful of items and would then put them at the front of the store in a special "SEE OUR PRICES ARE LOWER THAN WALMART" section.

I suppose to only thing newsworthy about this is how automated the process is. When I worked for Best Buy in 1994, we would often go to competitors to see what their prices were, and sometimes take pictures of the displays.

Sure it sounds shady, but that's how the free marketplace works.

I have never worked retail, nor would I desire to, but I pretty much expected this to be the case. And honestly, I don't really find it unethical. The fact that it's so automated might make this newsworthy because it seems excessive, but I don't see fundamentally what the problem is here.

This is pretty common. I worked at Wal-Mart for 7 years and our managers would give us promotional stuff, giveaways, etc for reporting prices within our departments. All it does is encourage competition on a store level to provide competitive prices. Not to excuse Wal-Mart from anything else they did, but I never saw the harm in it. I caught managers from our local K-Mart and Targets crawling our store all the time for prices.

This isn't illegal, though, as you can't copyright a fact -- much to the chagrin of MLB, which tried to sue stats compilation services once.

Actually, the devices are called Telxon (pronounced "telzon"). They're pretty common in just about every major retail store. I don't think we ever had a competitor bring one into the store while I worked at Best Buy, but I do remember people coming in to get price lists. I imagine our management would have escorted them out if they did. You can't copyright a fact, but you sure as hell can kick anybody out of your store for just about any reason you want. It is private property, after all.

Here's some Telxon pictures: [images.google.com]

Espionage? It's not like they're dumpster diving or piecing together shredded documents. It's publicly available information!

Or is it only nefarious "espionage" because the evil horned beast known as Wal-Mart is doing it? (setting aside the fact that it results in lower prices for consumers, mind you)

If mom and pop store A sends a clerk over to mom and pop store B to find out what B's price is on an item, is that "espionage"?

What, 6 comments in and no "Walmart is the Antichrist", or "this is what Walmart does when they're not killing babies or starving childern" comments.

Where am I?

Oh... and I guess looking at the story below, NetFlix is guilty of "Industrial Espionage" as well. Those bastards!

If this is "Espionage" then AlteredBeast is guilty of giving away classified trade secrets.

@buredemon: So, in theory, the two stores could keep going back and forth cutting prices until they were free?

This is espionage? Give me a break. It's good business and it keeps pressure on both stores to keep prices low. I am all for it.

Whatever takes the focus off your face.

They're Telxons, not Taxlons, and my Wal-Mart did it as well, but not just KMart, but Kroger, Save-A-Lot, et cetera. That was pretty rampant, actually. Part of the reason I left management was because they hired someone whose sole purpose was to "comparison shop".

How much do these "comparison shoppers" get paid? It sounds like a lot of fun, actually. I'd enjoy doing that.

You left because they were lowering prices? I could understand if they were doing this at a local mom and pop store but when big companies compete we all win (as long as they don't drive each other out of business). I don't understand why this is bad? It is nothing more than the free market working efficiently.

Well, people spend a buttload on impulse buys. So they're making way more than ten cents back.

I'm in the wrong business.

"Do you expect me to talk?"
"No, Mr. Price Scanner, I expect you to DIE!"

When I worked at Best Buy we would have this one Circuit City manager come in every weekend and check out our prices. We knew who he was and what he was doing; no one cared. We were even told to be nice to him. But I believe no one cared because one of the managers would go over to Circuit City and check out their prices. Everyone was cool with it. Also, neither managers would use the Taxlons. They would just use paper and pencil/pen.

I guess I just don't see the problem.

Meh. Where I went to college, there was a small gas station right across from a Coastal that set their price always 3 cents cheaper than the Coastal. I'm totally fine with this kind of behavior. Besides, it's not the policies that keeps me out of Wal-Mart, it's the other shoppers.

Gosh, I remember back in -- what, 1984 -- the new IGA opened close to my trailer park, which was nice in that we didn't have to go all the way to Kroger. But I knew the Kroger manager on sight, having always gone there with my mum to shop. On our first trip to the IGA, who's in aisles writing down the prices? The Kroger manager.

WOW!!! A WHOPPING 10 cents! All THAT...for 10 cents? wtf?

I can't find any follow up, but I was interested to see that a Tulsa grocery store sued Walmart over the practice alleging trespass (after the district attorney declined criminal trespassing charges). Given that the practice continues unabated, I assume they lost [or settled for virtually nothing]. See: [www.allbusiness.com]

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@buredemon:

I would think you could only charge tresspassing IF the walmart spy was caught once before & told never to come back again.

The consumerist should at least put the "industrial espionage" in quotes. Wal*Mart employees are simply collecting public information. In fact I'm suprised Wal*Mart doesn't advertise this. The only real complaint is that it may disruptive to people actually shopping there.

Hmmm... On the small scale, I can see this being negligible- if it's just a few guys with pen and paper, the amount of information you could get away with would be pretty small- good for setting up displays and sales, but you couldn't price your entire inventory that way. And the amount of time it takes your "spies" to collect the info probably costs the company more than you make on the sale- but creating the perception of lower price pays off in the long run.

But when you start to involve price scanners, things could conceivably change. The right technology (scanners aren't there yet) could allow you to undercut a competitor's entire inventory, which is a lot different than undercutting them on select Glade Plug-Ins.

On the small scale, I would call it competition. On a bigger scale, I would definitely think it qualifies as unfair business practices, or even espionage.

Why is this news and why should anyone be surprised by this? Many companies in all in all industries and in all countries are involved in this practice. On similar note, every company has a secret facility where they bring in competitors's products for disamsembly, analysis, and copying. This is all good for us consumer...better products and better prices.

It does not fit the definition of espionage.

-------------------------------------------
es·pi·o·nage (ěs'pē-ə-näzh', -nĭj)
n. The act or practice of spying or of using spies to obtain SECRET information, as about another government or a business competitor.

espionage. (n.d.). The American Heritage® Dictionary of the English Language, Fourth Edition. Retrieved August 16, 2007, from Dictionary.com website: [dictionary.reference.com]

I remember WM doing this at local grocery stores when a new supercenter opened here.

I am suprised they dont have scanners made into an undershirt harness with the scanning head attached to the wrist so that it could be completely hidden under a long-sleeve shirt. All wal-mart spies would have to do was to pick up a product & scan the upc code at the same time (or scan the sticker on the shelf while reaching for the product).
I find the "just bolt out of the store if you get caught" practice funny.

I worked for the local Sams Club. Price matching to the local Costco and other local stores was my fulltime job. This report does little to surprise me. I remember when I left Sams they were talking about bringing in a small PDA-esque Telxon for price shopping at Costco. Sams was so cheap they made me pay for my Costco membership and the PDA I used to price match.

Okay, I've heard this a couple of times, so here are some questions: since the telxon is basically a dumb (though wireless) Unix client (System 4.51 last I knew) is it interacting with the other store's system, or rather is it just being set to scan a barcode.

If it is interacting with the other store's system, then the use of one is a massive security error.

If more likely it is scanning the barcode and the price is being entered separately, then what's the point, as it will only be marginally faster than by hand with a higher risk of getting caught. Plus the risk of damaging or loosing a telxon. (They're only like a grand each.)

So, can someone who has done this actually explain the method, because the last time I heard about it supposedly they were also getting the rival stores markup.

@Major-General: "If more likely it is scanning the barcode and the price is being entered separately, then what's the point, as it will only be marginally faster than by hand with a higher risk of getting caught."
The post states that they have to key in the prices and therefore it is not interfacing with KMart's system.

So are Kmarts Nazi tees 10 cents more?

No matter what business you are in, it is just smart to know what the competition is selling products for. They could probably save themselves some time and pick up the sales circular from the Sunday newspaper.

Unfortunately this is not really espionage. I think you have to do something like hack their computers and steal next week's pricing data to qualify as espionage.

Walmart does this at the Target where I used to work. And Target returns the favor.

I used to work as an assistant manager for walmart and we did it at all local competitors. Kmart, Target, Kohls, Best Buy, etc.

Most of the time we were able to just scan the barcodes without having to enter the pricing information as the barcodes were generally the same. Once in a while if prompted we would enter the price, but it was rare.

Sometimes when they were signifigantly lower in price than we were we would head over and buy the item in bulk until they were out of stock, we then sold it in our store for the higher price.

Talk about monopoly...

The new Telxons the Best Buy I just quit had gotten in ran a version of Windows Mobile... it could still run the terminal based programs off of the store's server, but theres nothing to say that a program couldn't be written to run on windows mobile that could read the barcode off the signs... Best Buy signs have a barcode on them that includes the UPC, Price, and sign type. It actually reads xxxxUPCxxx - sign type - price

So assuming that the program knew how to read kmart barcodes ( a simple simple task) and had some kind of storage (and i do not know how much storage a telxon has) it could be setup to read it all... i kmart or target had barcodes on their stickers which incorporated all of that information.

Seems to me that a Kmart could have some real fun at walmart's expense by putting monstrously low prices on something they have almost none of and that the local walmart has lots of.

I worked at a Wal-Mart briefly when I was 17 and they encouraged all employees to go "comp shopping," but the almighty Telxons never left the store. They had a list in the back of specific products that they wanted to be lower than the competitors on. I guess they have some kind of formula for types of items to price low that will bring people into the store so that they can keep prices higher on what they think people will buy regardless once they're in. I'm not sure exactly, it's been awhile.

I always found it more repulsive that the managers got a bonus for keeping payroll low (i.e. short-staffing the place) and therefore working their fewer employees just that much harder. Or their idea of promoting kids to management positions right before or shortly after they graduated high school in hopes of gaining an employee for life that they could mold. Or how instead of telling people they were laid off, they'd just remove them from the schedule. It's such a classy joint I really can't pick a favorite.

I work at a Sam's Club and I know for a fact they do this. It's not really a big deal. What's news worthy about this?

Sam Walton began doing this when he opened his very first store, prior to Wal-Mart. I remember watching a History Channel story about it. He would put on a cap and some sunglasses, go over to the Wolworths, or whatever it was called, and make sure his prices were a nickle or dime cheaper. Nothing new here.

@ALADDYN: Thats whats going on in formula 1 between mclaren and ferrari. This is nothing unusual going on.

Heres an idea : Take those "price checkers" and the battalions of "managers","assistant managers" and corporate assclowns that wander around my WalMart and
PUT THEM AT THE DAMN REGISTER TO CHECK ME OUT SO I CAN GO HOME.That would do more to make me a loyal shopper than all of the 10 cent discounts in the world.Who cares whet KMART is doing,really? They haven't been relevant for years. Target (at least the one in my city) always has enough cashiers,and get this, they are under 70 years old !

I think it is funny that Wal-Mart is always the evil one. I worked at Target when I was in college as one of the cashier team leads. One of my duties was to organize my team to hit various stores to gather pricing information. We didn't use scanners; we just photocopied the list of items down to a very small size and then inserted it into an old checkbook. The team would then look for the item, write the price down and then head back to our store.

Wal-mart takes steps to ensure they are selling goods cheaper than the competition and you call that industrial espionage? Are you serious? I believe the correct name for that practice is called Capitalism. There is nothing wrong with what Wal-mart is doing. The anti Wal-mart faction in this country is based on pro union groups who are angry that Wal-mart is non union nothing more. It is time we all stop carrying the water for that special interest group.

Yeah, and when I worked in the mom and pop grocery store, and the local chain store, and even a regional grocery, they did the same thing. Almost all stores do this to some degree.
Dad likes to tell the story of the two gas stations in his home town who would compete over having the lowest gas prices back in the '50's. Every night, one would lower the price on his sign to a penny or something, so the other guy couldn't see his price on his way home. One morning he got to the store late and didn't get it changed before customers showed up, so he had to sell it for the penny. Same concept, even back then.