Walmart
Essay title: Walmart
Wal-Mart stores are currently the world’s largest retail store and also the world’s largest corporation. “Wal-Mart was founded by Sam Walton in 1962, incorporated on October 31, 1969, and listed on the New Your Stock Exchange in 1972.” (Wal-Mart) Wal-Mart is not only the largest retailer in America when it comes to generic goods; they are also the largest retailer in grocery items as well. They are well known all around the world for the simple reason that they have stores in many countries around the globe. Wal-Mart is America’s largest corporation because of their great business strategies and low care for their employees.
Sam Walton had very good timing when it came to the creation of his stores, for the shear reason that Americans were buying a lot more items then when his competitors like Sears and Woolworth had their heyday. (Lichtenstein 53) He also was very smart when positioning his stores. He put them in small communities (under 5000 people) where big companies have not hit. The plan that he conquered in his stores was the “one-stop-shopping” experience. Wal-Mart put everything into one store and put them all at a discount. This became a dream come true for American families. A Minnesota woman once wrote her local paper about her experience at Wal-Mart and she said she could “come out with a cart full top and bottom for the same amount of money that would fill only a bag or two at other stores. How great that feels.” (Lichtenstein 54) Wal-Mart uses two strategies for keeping there prices low. One is that they let employees go easy when they get a better paying job somewhere else, they also are very famous for squeezing lower prices from there whole sellers. Another strategies that they use is getting tax breaks by offering to pay for a lot of the city expenses when they build there stores around their areas.
Wal-Mart is not only the major retailer in the United States, they have operations taking place in 14 other countries; they are the Worlds largest retailer. It is estimated that 20.1 % of fiscal sales are made up by the global stores. (Wal-Mart) They have 1.8 million employees worldwide and are the largest private owned corporation in Mexico, and one of the largest private corporations in Canada. (Wal-Mart) Wal-Mart also “has joint ventures in China and several majority owned subsidiaries.”(Wal-Mart) In 2006 Wal-Mart announced that they would withdraw from operations in Germany because of there losses and also because of the highly-competitive market over there.
“Wal-Mart entered the Mexican market in 1991, boast 696 Mexican stores and 2004 sales of 140 billion pesos (close to $12 billon), eclipsing the 111 billion pesos earned by its three closest competitors combined.” (Lichtenstein 189) They have taken over the Mexican retail stores with more than 101,000 employees and have been critiqued for transforming the Mexican market. (Lichtenstein 189) Out of the other eight major industries in Mexico only two of them pay less to there employees. So what is the reason for their success in Mexico? The answer to this is very simple, first of all for their size once again. The only other company that comes close to them in Mexico is 7-Eleven and they only employee 1/20th of that of a supermarket. (Lichtenstein 197) Another reason that they are so successful over there is the same reason why they are in the United States. They have “low-price strategies, high technology distribution network, and intense pressure on suppliers for discounts.” (Lichtenstein 197)
So with all this success of Wal-Mart there has got to be a catch? Yes there is a catch and this catch has been looked at many times by organizations as being one of the dirtiest things this corporation can do. When you first look at their employee strategies you would think that it is a very smart thing to do, and I would agree with that, but when you look deeper into it from an employee’s spectrum it is very controversial.
The strategy that they use to increase productivity is to simplify tasks so that they are performed more quickly. (Head) Unlike on-the-line work used at manufacturing plants employees are not engaged in single, repetitive tasks. The flow that they use is that of the flow of goods entering the back of the store and that of customers entering the front. Both of these flows are not constant so employees have to change as the flow changes. (Head) This is a very smart way to do it and keeps employees moving at all times.
The employees at Wal-Mart never to seem to be enough to support the work that is given to them. “Managers are given a “preferred budget” for employment, which would allow managers to staff their stores at adequate levels.”(Head) The problem with this is that their actual budget would fall short of what they needed to employee people, so they need a lot of extra work from their workforce. Jed Stone a manager