Wal-Mart Era Wanes

[RedEarth]

The Wal-Mart Era, the retailer's time of overwhelming business and social influence in America, is drawing to a close.

Using a combination of low prices and relentless expansion, Wal-Mart Stores Inc. emerged from rural Arkansas in the 1970s to reshape the world's largest economy. Its co-founder, Sam Walton, taught Americans to demand ever-lower prices and instructed businesses on running a lean company. His company helped boost America's overall productivity, lowered the inflation rate, and strengthened the buying power for millions of people. Over time, it also accelerated the drive to manufacture products in Asia, drove countless small shops out of business, and sped the decline of Main Street. Those changes are permanent.

Today, though, Wal-Mart's influence over the retail universe is slipping. In fact, the industry's titan is scrambling to keep up with swifter rivals that are redefining the business all around it. It can still disrupt prices, as it did last year by cutting some generic prescriptions to $4. But success is no longer guaranteed.

Rival retailers lured Americans away from Wal-Mart's low-price promise by offering greater convenience, more selection, higher quality, or better service. Amid the country's growing affluence, Wal-Mart has struggled to overhaul its down-market, politically incorrect image while other discounters pitched themselves as more upscale and more palatable alternatives. The Internet has changed shoppers' preferences and eroded the commanding influence Wal-Mart had over its suppliers.

As a result, American shoppers are increasingly looking for qualities that Wal-Mart has trouble providing. "For the first time in a long time, quality has a chance to gain on price," says Lee Peterson, a vice president at Dublin, Ohio-based brand consulting firm WD Partners Inc.

http://online.wsj.com/public/article_print/SB119135657404946747.html

[Crazy Dave]

1. It has to level off sometime

But it sure does remind me a lot of the movie "Demolition Man". Instead of all the restaurants being named, "Taco Bell", all the stores will be named "Wal-Mart" one day.

[JPZenger]

2. Good Article

I heard a commentator say recently that typical Walmart shoppers are having trouble even affording Walmart. I guess that's what happens when everything is outsourced to China - eventually people can't afford even Walmart's Shit.

This week, two major drug store chains reported losses. Apparently, it was because of Walmart's cost cutting on generic drugs. They still have the economic power to destroy a company if they wish. This is known as "category killing" in which no one else can compete in a certain business if the big guy decides to use major discounts. Then once the competition is gone, they can jack prices back up.

[Union Yes]

3. Walmart- Striving to make lead paint hip again.

To add more to the "category killing" debate.

Walmart is capable of engaging in this shrewd practice across multiple "sectors" of product categories. The latest victims of the Walmart effect- groceries and electronics.

Its no secret that Circuit City has been hit hard by the Walmart effect. Thousands of employees nationwide have been laid off. Best Buy has weathered the storm so far but has felt the effects with lagging sales.

With the increasing popularity of Walmart "Supercenters", the grocery sector is the newest victim of the Walmart effect. Entire grocery chains have gone bankrupt in recent years. MOM and POP grocers are ancient history in America. Especially rural America, M&P grocers have been so long gone that today's generation of youth doesn't even know what a Mom and Pop store is. M&P grocers have found a small niche in certain urban settings only due to the fact that urban planning basically protected those buisnesses from the ultimate predator, Walmart.

Capitolism - Its not about competition. Its about killing your competition.

[Cronopio]

4. Competition *is* the practice of killing the competition.

Which is the best argument against unregulated competition. Unregulated competition always destroys the state of competition, whether it's a football game or an economic system.

Not disagreeing with your comment of capitalism, just underscoring it. I'm still amazed at how many progressives I know that don't believe the nature of competition is anti-competitive.

[madmom]

5. this story is very misleading....I was shopping for a birthday present

for my granddaughter, went to Kmart, Meijer, and Walmart, Meijer a so called union shop (I used to work there and believe me they are union in name only!) had the highest price for the same item. I even checked product code numbers on the box exactly the same. So tell me why I would pay $9 more for the exact same toy I could go across the street and get cheaper? It was a name brand product which are all made by the same company. Maybe Walmart can charge less because they sell in volume and don't try to make all their profit off one sale, or the manufacturer makes them cheaper because they want a bigger profit from the same item, instead of safety they think bigger profit?ie lower the price so more people can afford to buy the product we sell more,keep prices high only certain people can buy, which makes more profit? Food for thought.....Flame away!:nuke:

[RedEarth]

6. This article is primarily about how same stores sales at Walmart

have not increased as much as expected and how other retailers have been able to find ways to compete with Walmart on things other than price....in particular convenience and quality.