Walmart: Welcome to the Machine
Essay Preview: Walmart: Welcome to the Machine
Report this essay
Wal-Mart: Welcome to the Machine
Wal-Mart, Wally World, The Wal-Mart, the name doesnt change what it is: A corporate machine that has made a significant and horrendous impact on the global economy. Although they have been very compliant with the Better Business Bureau and handled all customer dissatisfactions with the most professional tactics available (BBB reliability reports), they just dont quite contribute to the progressive global economy that everyone wants to see. They have been accused of denying employees benefits, forcing them to work off the clock, and denying them rightly earned over time pay. The shroud of shadows does not stop here. Wal-Mart has also been associated with the exploitation of suppliers and even with monopolization. All these affiliated discrepancies have given Wal-Mart a horrible reputation. These are the reasons that Wal-Mart, the corporate machine, the menace to the global community, must be stopped. The first impact on the global community that Wal-Mart has made, although not the most severe, is the exploiting of there own suppliers.
“Large retailers, they argue, are increasingly able to squeeze their suppliers and induce various forms of price concessions.” (Wal-Mart: The face of twenty first century capitalism) If large retailers are capable of that, then just imagine what the worlds largest retailer is capable of.
“Wal-Mart controls about 15 percent of the domestic sales of general merchandise and food, and in some categories such as household staples and basic apparel its share is closer to 30 percent. Even for the biggest manufacturers of packaged consumer goods, from Procter and Gamble to Clorox and Revlon and from Del Monte to Nabisco and Sara Lee, the amount of business with Wal-Mart – typically ranging between 15 and 30 percent of total shipments – creates a significant dependency on the retailers demands.” (Wal-Mart: The face of twenty first century capitalism)
The perfect example of exploiting the supplier in Wal-Marts business practices is the sale of Vlasic pickles. Wal-Mart has done the unspeakable to Vlasic pickles. It might not sound like much, but it is indeed. Wal-Mart sells a years supply of this item for the ridiculous price of 2.97 dollars. Again, this not sounding like a big deal is no surprise, but look at what it does to Vlasic. (The Wal-Mart You dont know)
“By selling a gallon of kosher dills for less than most grocers sell a quart, Wal-Mart maybe have provided a ser-vice for its customers. But what did it do for Vlasic? The pickle maker had spent decades convincing customers that they should pay a premium for its brand. Now Wal-Mart was practically giving them away. And the Fevered buying spree that resulted distorted every aspect of Vlasics operations, from farm field to factory to financial statement.” (The Wal-Mart You dont know)
This shows the true nature of the pressure that Wal-Mart puts on its suppliers all in the name of “every day low prices”. (The Wal-Mart you dont know) This is the price Vlasic has paid just so we can see a smiling yellow face kicking back prices. To extrapolate how intense this impact is on the supplying company we must really look at what Wal-Mart is. They are more than just the largest retailer in the world they are the largest company. They sell in three months what the runner up retailer, Home Depot, sells in a year. (The Wal-Mart you dont know) If you think about those kinds of facts then it becomes clear what happens to Vlasic or any supplier of Wal-Mart. If Wal-Mart, being the largest company in the world, gets the majority of sales as opposed to their competition then the suppliers of Wal-Mart are forced to A) sell there product at Wal-Mart to make the sale and B) to sell at a lower price because it was what is guaranteed to the customers. One might argue that the only example that can be present is Vlasic and the importance of that issue can be undermined because we are only dealing with pickles. To put a number on it there are over 61,000 different suppliers for the store. Thats the potential for 61,000 accounts of exploitation. Lets look at a few examples of this.
Just recently it has been released that Wal-Mart will continue to cut prices in other areas, namely toys. They have just posted an 11.5 percent rise in net income and announced that they would begin the most aggressive pricing strategy ever. Stock prices rose four percent. Thats all fine and well for Wal-Mart, but what does that do for Mattel inc. or Hasbro? Both have faced a cut in unit sale price buy ten and fifteen dollars respectively. (Wal-Mart Further cuts U.S. toy prices) In truth we as customers pay no price for the consistent and even convenient rolling back of prices, but as an economy we all suffer. If the suppliers cant make their sales then they cant pay their people.
“Wal-Mart, so the press asserts, has the power to “squeeze” its suppliers, reducing their profit margins, imposing cost-cutting measures, and, in the case of U.S. firm, forcing them to turn to outsourcing.” (Wal-Mart: The face of twenty first century capitalism)
Maybe in the end they will all end up working for The Wal-Mart. Even that, though, is not as fantastic as it sounds Im afraid.
“In recent years, Wal-Mart has come to represent the vanguard of corporate power in America. As Nelson Lichtenstein and others have argued. Wal-Mart has become the paradigmatic representation of a new age in the history of capitalism. Its work force practices, a vociferous anti-unionism, embedded gender discrimination, compulsive cost cutting, and near-comprehensive control over workers and the work place – have drawn well-publicized ire from labor activists, community organizers, the main stream media, and a large portion of the American public.” (Wal-Mart: The face of twenty first century capitalism)
When it comes to taking care of employees, who do you think fails to make available modern day survival tools like decent wages, health benefits, and a chance to move up? You guessed it, Wal-Mart. Well, on the topic of health benefits, they do offer them, but the cost of these benefits are so high that the employees cant manage to pay for them. Further spurring the lack of income to pay for benefits, they also pay their employees so close to minimum wage that they can barely afford to live, let alone pay out for medical care. When it comes to providing a chance for lateral movement in the company, however, Wal-Mart is not entirely guilty not providing the opportunity. Just recently they promoted 90,000 employees from hourly to management positions. (Wal-Mart Launches P.R. blitz)