The Wal-Mart You Don't Know

[the_boxer_]

The Wal-Mart You Don't Know

<snip>

Wal-Mart is not just the world's largest retailer. It's the world's largest company--bigger than ExxonMobil, General Motors, and General Electric. The scale can be hard to absorb. Wal-Mart sold $244.5 billion worth of goods last year. It sells in three months what

number-two retailer Home Depot sells in a year. And in its own category of general merchandise and groceries, Wal-Mart no longer has any real rivals. It does more business than Target, Sears, Kmart, J.C. Penney, Safeway, and Kroger combined. "Clearly," says Edward Fox, head of Southern Methodist University's J.C. Penney Center for Retailing Excellence, "Wal-Mart is more powerful than any retailer has ever been." It is, in fact, so big and so furtively powerful as to have become an entirely different order of corporate being.

Wal-Mart wields its power for just one purpose: to bring the lowest possible prices to its customers. At Wal-Mart, that goal is never reached. The retailer has a clear policy for suppliers: On basic products that don't change, the price Wal-Mart will pay, and will charge shoppers, must drop year after year. But what almost no one outside the world of Wal-Mart and its 21,000 suppliers knows is the high cost of those low prices. Wal-Mart has the power to squeeze profit-killing concessions from vendors. To survive in the face of its pricing demands, makers of everything from bras to bicycles to blue jeans have had to lay off employees and close U.S. plants in favor of outsourcing products from overseas.

Of course, U.S. companies have been moving jobs offshore for decades, long before Wal-Mart was a retailing power. But there is no question that the chain is helping accelerate the loss of American jobs to low-wage countries such as China. Wal-Mart, which in the late 1980s and early 1990s trumpeted its claim to "Buy American," has doubled its imports from China in the past five years alone, buying some $12 billion in merchandise in 2002. That's nearly 10% of all Chinese exports to the United States.

<snip>

http://www.fastcompany.com/magazine/77/walmart.html

[Enraged_Ape]

1. Oh, I knew all this

Which is why I won't get caught dead shopping in a WalMart. I don't care if I have to pay 30 cents more for toothpaste somewhere else; they are just grim, nasty places that depress the hell out of me.

[the_boxer_]

2. This country is being ruined by the greed of corporations...

:eyes:

[SmileyBoy]

3. Most suppliers of goods in the US are dependent on ONE single company.

(begin rant)

That's NOT CAPITALISM!!!!!!!

IT"S NOT FUCKING CAPITALISM, PEOPLE!!!!!!!

Jesus Christ, it's NOT capitalism at all!!!!!

Wal-Mart is a VIRUS that must be destroyed. Look at what they do to the infrastructure and economies of THOUSANDS of small towns in the US!!!

BOYCOTT the SOB!!!!

(end rant)

[TXlib]

14. Agreed. Wal-Mart is a virus

ClearChannel is a virus.
Microsoft is a virus.

How do you propose we fix the problem?

[Nikia]

4. It puts manufacturers in a bind

It is simply impossible to drop the price of a product consistently every year while prices of raw materials goes up. While most managers and R&D people do figure out cost saving measures, there is only so much money that a company can save so that quality of the product is not sacraficed, which is happening at least in my industry, or that the company makes tough decision like moving jobs oversees. Yes, some companies are successful and could operate at a lower profit margin. Some cannot. Regardless, the companies are being bullied into lowering their profits while increasing Walmarts profits. Companies could decide not to sell their product at Walmart, but Walmart does such a high volume of business that once they are selling to them, it is hard to get out.

[crobinson2k]

5. On the other hand

Much to my best friend’s chagrin, I shop for groceries at Wal-Mart. I know, I know. Wal-Mart is to the new millennium what General Electric was to the nineties – a monster whose very existence proves that Satan is alive and well. Sam Walton’s global corporation pollutes the world and exploits its workers. I understand all that. However, where else can you buy twelve rolls of toilet paper for a buck fifty? Therefore, every Saturday morning before dawn, I head to Wal-Mart for a weekly supply of food. I try to get in and out before any of the toothless, spandex-wearing tubbies show up looking for cheap cigarettes or hunting rifles. If it makes any difference at all, I hate myself afterwards. Okay?

[SmileyBoy]

6. I forgive you.

Welcome to DU!!!:hi::hi::hi:

[ScreamingMeemie]

7. I shop at Big Lots...same great prices (and lower) and much

less guilt. :hi:

[scarlet_owl]

9. Ah, Big Lots.

I sure will miss having it within walking distance when we move. It's the only place I buy things like deodorant and T.P.. I get all my spices there, too.

[ScreamingMeemie]

10. I get my spices there too!! Can't beat 49 cents!

I buy all the kid stuff there. Juice boxes, fruit roll ups, cereal. Plus they have great deals on frozen foods. Only thing is, we get hooked on something (like Star Wars cereal) and then it's gone. :(

[TXlib]

13. Welcome to DU, but...

As the article states, the problem is that consumers are not considering the COST of their purchases, only the PRICE.

If you figure the probable long-term consequences of shopping at WalMart, you'll realise the extra couple of bucks are worth it.

Consider the example of the Vlasic gallon jar of pickles: People buy it, eat 1/4 of the pickles, and throw the rest out when they start to go bad, and buy another gallon jar. Consider how wasteful and selfish that behavior is, when they could have just spent the same amount of money (or less) on 1/4 volume of pickles elsewhere.

[scarlet_owl]

8. Wal-Mart can go to hell. We currently have two

in our area, one in Savoy and one in Champaign. They are planning on adding one in Urbana, which is an adjacent town to Champaign. The problem is, my husband works for a grocery store in Urbana. The store is a neighborhood grocery, and it caters to folks who walk or take the bus. Right now we're hoping that those same folks will still walk to my husband's store, but we're facing the reality of the city bus system to add a route out to the new Wal-Mart. I don't know what we will do if my husband loses his job. I am on disability and can't work, plus we just bought a new house with my mother-in-law, and she can't make our half of the payment as well as hers. Why does a population center of 100,000 people (my estimate) need three Wal-Marts? We have a Meijer, two Schnucks', four County Markets (my husband's company), a few IGAs, a K-Mart, and several others. Wal-Mart can fuck off.

[denverbill]

11. They bankrupted a company I worked for, IMO.

I used to work for a trucking company, a relatively small privately owned company which had only just gained a national reach.

Landing the Walmart account was a big deal. After a year or so, they easily became our biggest account. Unfortunately, when it came time to renegotiate our deal, Walmart played hardball. After we had hired extra employees, built expanded facilities, etc, to handle their freight, they came back and gave us a take it or leave it rate which essentially meant we were losing money on every piece of freight we delivered.

Management unwisely decided to keep hauling for them anyway, and we had to jack up rates to all other customers to break even. Eventually, those customers bailed on us, and we were screwed.

Walmart sucks.

[NJCher]

12. SOP for WalMart

I heard a radio show that analyzed the business practices of Wal-Mart and that is standard operating procedure. They give the specs for the work and next time the contract is up for re-negotiation, they want an even better deal. And they never stop asking for it. Where does it end? There has to be some limit to this.


Cher

[the_boxer_]

15. I heard the same SOP on NPR...

the case in point story about the pickles. Wal-Mart, although, catering to consumer needs, must realize that those same consumers have jobs in supply/production. Once those consumers lose their jobs to foreign job markets, they won't be able to even afford Wal-Mart!

[WWW]

16. I too hate myself for shopping at WalMart

But the lower prices thing is crap. I had to get a powerpoint program today. I could waste two hours and 100 miles on the car for gas or go to WalMart and get the program in a 30 minute round trip. While there, I picked up some hot dogs and rolls. The rolls I normally pay 99 cents for were $2.09! And the hot dogs weren't any bargain either. More than $2 for what I normally pay $1.79.

BTW the powerpoint program was $10 more than at Staples.

[Deja Q]

17. How much do customers save? $1 tops?

Most items are just pennies less.

All computer software is the SAME price as everyone else.

Buy a fish there, it might be slightly lower in price, but at least PetSmart knows how to keep them in good health!

Wal-mart is stretching the truth when they say their prices are less.

Apart from Adobe Photo Elements 2.0 (which is $60 at walmart, $100 everywhere else - WHY?), I've found nothing at walmart that truly does cost less.

And with how walmart treats workers and customers, it's pathetic they get any business at all.

[Nikia]

19. We often buy Equate brand toiletries and OTC drugs there

We save money this way and it is convient because our duplex is closer to it than their far parking spots. We sometimes buy snacks, emergency hardware, and cleaning items there also. These items are generally cheaper than at the other stores in our area and our Walmart is closer and open later if we need these items right away.
We do not buy clothes, electronics, books, jewelry, software, music, or dvds there. These items are not a bargain at Walmart and the quality and selection is poor. We also do not generally buy groceries there for the same reason.
I know that Walmart is evil but for us it so much easier to buy convience items there for us.

[YellowRubberDuckie]

18. You know those products they mark 1/2 off, 75% off?

The distributers, the ones that walmart gets their stuff from, have to absorb the difference. Say Walmart puts something for sale at regular price, say 28.50. It doesn't sell, so they knock the price down by 1/2. The distributor now owes walmart 14.25 for that item, per item. That's how much walmart gets back. That's why they're the number one company and they make so much...because they are squeezing a lot more money back from those middle men. My bf used to work for the distributor of the bullets and black powder that Walmart uses. He caught a glimpse at the contract once. Not a pretty document, he said.
Duckie

[crobinson2k]

20. I know, I know!

I save fifteen bucks a week shopping at Walmart for groceries. I don't spend the extra $60 a month on cable, processed food, alcohol, or drugs. I don't even spend it on therapy I will eventually need for raising two strong-willed children without using television as a babysitter. I put that extra money in a jar, saving it up for when the kids go away to Harvard, all the hard times are behind me, and I need a good long vacation somewhere no one will ever find me. A girl can dream, right? :-)