'The Wal-Mart You Don't Know'

[seafan]

Ran across this piece quite by accident, and man is it an eye-opener.

After reading this article, it is crystal clear that we, as shoppers in this country, have it in our power to stop this job drain to other countries. Our political system will be reformed by grassroots. And so will the restoration of our economy by the same grassroots efforts. We must faithfully support small businesses and suppliers for our purchases, instead of cannibalistic enterprises that rope customers in by offering more and more products at less and less retail cost. But what we are not told is that we are paying an incalculable cost in loss of jobs and livelihood for our nation's own people, and in the critical loss of our collective economic power as a nation.

What good is it to offer people rock-bottom prices for goods when the people have no money to pay for them because their jobs have been lost to other countries? Once again, we are reminded that mega corporations are only concerned about the bottom line. Meanwhile, the people are relegated to getting in line.


This article is lengthy, but ought to be read by every shopper in this country. We are our own answer to taking back our jobs, our governmnent and our dignity.
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From the article:
<snip>
The giant retailer's low prices often come with a high cost. Wal-Mart's relentless pressure can crush the companies it does business with and force them to send jobs overseas. Are we shopping our way straight to the unemployment line?

<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.

<snip>

....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.......


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

[KCDem]

1. thanks for the link.

I pledged to myself last night that I would not shop at Walmart again (well... unless I really really couldn't get anywhere else!) after listening to Jim Hightower rail on them. I've never liked them, but I've tolerated what I'd known about their labor practices, etc. for the prices. No more.

[Political_Junkie]

4. unfortunately

at this point Walmart has run every other department store out of my area, so people here have no choice, but that may be changing soon. There's rumors that we may be getting a new store right up the street from me. Let's hope they can compete.

[mike_c]

6. you always have a choice....

Use catalogs or internet shopping if necessary. Support local merchants, even if they do charge more. DON'T SHOP AT WALMART!

It never ceases to amaze me how these sleaze-bag uber-kapitalists are always first in line at the RW nationalism fest but they're only real loyalty is to themselves and their greed.

[cliss]

2. thanks for the post.

I don't shop at Wal Mart. Never have, never will. I read just a few months ago here at DU that they are big donors to the Rat-publican party.

That was enough for me. Now all this.

[MODemocrat]

5. My daughter and my granddaughter have switched to Target

I'm going to do the same; as well as still shopping at K-Mart whenever I can. :mad: :argh:

[DuctapeFatwa]

3. Why not shopping at Wal-Mart won't really work

First of all, I commend those who have the choice to boycott Wal-Mart, and it definitely does work in terms of making those who are able to do so feel better about themselves.

However, remember that you are in the minority - most people, that bottom 75% income group that doesn't vote - doesn't have a choice.

Even if there are other retail outlets that they can access, poor people just cannot afford to go pay a dollar more for this, ten dollars more for that. If they are going to buy it at all, they have to buy it at the cheapest place, which is Wal-Mart.

That is why Wal-Mart does not care if all the affluent people boycott them. They don't need you. They need the single mom whose kids will have no shoes at all if she doesn't get the ones for 6.99 at Wal-Mart. They need the senior citizen who will not be able to buy over the counter medications or reading glasses or a new pillow case unless she buys them at Wal-Mart.

So it is fine to boycott them, but at the same time, you should remember that the huge mass of Walwage poor they spawn, and those who can't even get a Waljob, are the people who are buying their products, and the people who don't have the luxury of going to the mall and buying the higher-priced spread to make a statement of principle.

[unblock]

7. monopoly and monopsony

wal-mart is both a monopoly and a monopsony at the same time.

a monopoly is when you have the power to influence market prices of what you sell.

a monopsony is when you have to power to influence markey prices of what you buy.

wal-mart is, or becomes, the sole or nearly-sole vendor of groceries, household goods, and so on. they are clearly in a position to control prices far beyond what true competition would permit.

wal-mart is also, for many products, the sole or nearly-sole purchaser of goods. if you make toys or whatever, you better have wal-mart as a customer or you WILL go under. then even the other purchasers you do have will see what price you are selling to wal-mart and refuse to pay much more than that.


incidently, i price receivables for a living (my company purchases and securitizes receivables). wal-mart receivables are the receivables equivalent of junk bonds. before they even become a receivable, they negotiate themselves a great price. but then, they almost never pay what the agreed to. when the product gets delivered to them, they will deduct a charge for such things as:
truck arriving late;
truck arriving EARLY;
items on truck loaded in the wrong sequence;
items shipped in boxes or the wrong measurements;
worn palettes (those wooden 6-inch high platforms they stack boxes on for forklifts);
shipping too few items (that one is reasonable, but guess what the next one is);
shipping too MANY items.
and the list goes on and on and on and on. in fact, they have a huge set of binders detailing every little thing they will take a deduction for.

oh, and, unless you're absolutely perfect, and to a lesser extent even if you are, wal-mart NEVER pays in a remotely timely fashion. often they will be expecting delivery of the third or fourth or fifth shipment before they've paid a dime on the first. suppliers sometimes go broke, just when they think they've hit it rich by signing wal-mart as a customer.

now for the best part:

let's say you've been shipping to wal-mart and you're constantly getting nailed for, say, shipping too early. so you've been getting, say 90 cents on the dollar billed because wal-mart deducts the other 10.
so you make pay 5 cents on the dollar more to a more expensive shipping company so you now arrive at the right time, so they will no longer deduct the 10 cents, right? WRONG. wal-mart says, well, you didn't go belly-up when you were getting 90 cents on the dollar, so we'll split the difference with you. then, even when you do everything right, the still take a 5 cent deduction.

the retail business has an extremely narrow profit margin. sure, they make up for it in volume, but still, mcdonald's are absolutely everywhere as is coca-cola, and while these are also quite successful, they pale next to wal-mart. why? by squeezing suppliers, wal-mart gets a bigger profit margin, and THAT, times the huge volume, is huge profit.

i always say that wal-mart is not in the retail business. it's in the receivables deduction business, because that's where they really make their killing.

[Lefty48197]

8. Make it embarassing for people to admit shopping at Walmart

Make it common knowledge that their stores are staffed by people who are denied basic wage and hour protections.

Make it common knowledge that their products are manufactured in southeast Asia by ten year old girls making pennies per day.

You saved how much at Walmart? Gosh, I'm sure the ten year old Chinese girls working 16 hour days for slave wages appreciate your support. Thanks!

[unblock]

9. too late, who cares

many people already know this.
many of these people don't care.
in fact, many people think it's great that they figured out a way to give them one-stop shopping at reasonable prices and think that more than outweighs how badly they treat temp workers or illegal aliens or overseas sweatshop workers.
and then there are people like me, who dislike wal-mart as much as the next guy, yet who occassionally shop there. if other stores are out of stock of widgets, too expensive, or i'm in a rush and don't have time to find out who's got this thingamajig.

that's the power of a monopoly. limited or no choice. and monopolies always have fans: people who like having no choice (they simplify decisions such as where to shop or buy software); people who think that if they're the only one who can do it, it must be hard or impossible for anyone else; and people who see constant improvement and think that's great (microsoft software does get better with each release. nevermind that it took until windows 95 for them to build in technology from 1970, it was still better than windows 3.x....)

[srpantalonas]

10. Picket WalMart Nov 28th, 9am-12pm

protest on the biggest shopping day of the year.

[bobbieinok]

11. Is this a national plan??

...