Wal Mart thread

[JohnT]

You tell them to **** themselves. You have a responsibility to your shareholders and there's no need to conduct business if it doesn't bring profits. Hell, in order to keep your job, it's the only response possible.

Honestly, people, the complaints about Wal-Mart are nothing new. Again, these same issues have popped up regarding Sears, Penneys, A&P, Kroger, Home Depot... damn near every successful retailer in existence. There's nothing in this thread that's original, including the fear that "nothing can stop them." Standard Oil was stopped, and that was a monopoly with far, far, far, far, far, far, far greater power, influence, and market penetration than Wal-Mart could even begin to hope to dream of wanting to achieve. Capice?

[Jonny]

Originally posted by Zkribbler


POP QUIZ:
You're the CEO of Rubbermaid. Your No. 1 customer, Wal Mart, has just demanded price concessions which will, in effect, turn over all your profits to Wal Mart. What do you do? What do you do??

Unfortunately, that is a all too common situation for Walmart's suppliers.

My aunt was a representative for Hanes/Playtex, and she absolutely hated going to Walmart headquarters in Bentonville simply because they could pretty much get what they wanted in negotiation, as their purchase would make up a good fraction (say 30 or 40 percent) of the company's production, and there were no other customers for such a huge amount of product.

[JohnT]

Short-sightedness on your aunts (or her bosses) part then.

Business that brings in no profits is worse than no business at all. Haines isn't a goddamn charity, and if they're supplying Wal-Mart with no benefit to them at all, that's what they've allowed themselves to become. Better to lose the 30% of unprofitable business and re-orient yourselves than to become little more than a jobs program.

[mrmitchell]

including the fear that "nothing can stop them."

Who said my attitude was fear? I see it as a goal.

POP QUIZ:
You're the CEO of Rubbermaid. Your No. 1 customer, Wal Mart, has just demanded price concessions which will, in effect, turn over all your profits to Wal Mart. What do you do? What do you do??

They won't turn over profits to Wal Mart, they'll pretty much eliminate them altogether. And like JohnT said, if it's not profitable, Rubbermaid CEO should tell Wal Mart, "go screw yourselves." I always thought in business it wouldn't be worthwhile to sell things at a loss, as it is...

[Zkribbler]

Originally posted by mrmitchell
And like JohnT said, if it's not profitable, Rubbermaid CEO should tell Wal Mart, "go screw yourselves."

Rubbermaid did. Now, no more Rubbermaid.

You have to place some of the blame on Rubbermaid. When you -- or Haines -- has such a singularly large customer, and when you can't afford to lose that customer, it lays you open for economic coersion.

You can't offer your economic throat to anyone in the business community and still expect them to treat you fairly.

[:) Smiley]

Originally posted by mrmitchell
Maybe all of us should be rich and moralistic so we can all go shop at Target and those old fashioned, nasty unhelpful expensive mom & pops.

I do most of my shopping in Chinatown, where stuff is cheaper than Walmart. Companies don't need to be massive monopolies to make money.

EDIT: What I mean to say is, many people can live at a better standard because they don't have to pay insane amounts of money for basic items, and they have Wal Mart to thank for it. No one ever recognizes this and it's probably the most influential thing the company has done.

$1.00 for a bar of soap vs. $1.05 for a bar of soap...
$50,000 factory job vs. $30,000 service job...

[DanS]

Originally posted by Jonny


Unfortunately, that is a all too common situation for Walmart's suppliers.

My aunt was a representative for Hanes/Playtex, and she absolutely hated going to Walmart headquarters in Bentonville simply because they could pretty much get what they wanted in negotiation, as their purchase would make up a good fraction (say 30 or 40 percent) of the company's production, and there were no other customers for such a huge amount of product.

Good thing we have Walmart to make companies continuously look toward cost improvements!

[Imran Siddiqui]

Maybe all of us should be rich and moralistic so we can all go shop at Target

Since when do you have to be rich to shop at Target? The prices are very similar to WalMart and the service and *ahem* "moralistic concerns" are much better at Target.

[:) Smiley]

I thought the market improves through competition, not monopsony.

[Imran Siddiqui]

Originally posted by JohnT
You tell them to **** themselves. You have a responsibility to your shareholders and there's no need to conduct business if it doesn't bring profits. Hell, in order to keep your job, it's the only response possible.

Honestly, people, the complaints about Wal-Mart are nothing new. Again, these same issues have popped up regarding Sears, Penneys, A&P, Kroger, Home Depot... damn near every successful retailer in existence. There's nothing in this thread that's original, including the fear that "nothing can stop them." Standard Oil was stopped, and that was a monopoly with far, far, far, far, far, far, far greater power, influence, and market penetration than Wal-Mart could even begin to hope to dream of wanting to achieve. Capice?

While I agree with your general statement, Standard Oil was stopped by the government's breakup of the company .

[:) Smiley]

Another example of government intervention would be the railroad industry, which was regulated to bankruptcy by government. Retail is such a broad field however that Walmart would have to get significantly bigger before it becomes a real monopoly.

Speaking of Standard Oil, though, I wonder when some Chinese company will make a bid on a major US retailer, and what the public reaction would be.

[mrmitchell]

Wal Mart won't just go and raise all its prices for profits sake even when it has 90% of the retail market. They know that all they have is low price, and anyone else could come in and pull the rug out from under them if they got lazy.

[Imran Siddiqui]

Yes, but they could have stupid management in the future... maybe them overexpand into some overseas markets or whatnot. It can't last forever and it won't.

[Zkribbler]

Originally posted by Smiley
Another example of government intervention would be the railroad industry, which was regulated to bankruptcy by government.

No, it was pwned by the post-war growth of airlines.

[:) Smiley]

Originally posted by Zkribbler
No, it was pwned by the post-war growth of airlines.

That's half the story. Railroads were required to continue operation of the long distance routes where they were of greatest disadvantage vs. airlines. Even today, Amtrak loses money because it has to run long distance routes in addition to the Northeast Corridor.