Closed: Go To Wal-Mart

Since Wal-Mart is buying through economies of scale, a little mom-and-pop can’t compete on price, anyone knows that.  Is Wal-Mart trying to take over the world?  Absolutely, and doing so w/our dollars.  Is that really the best thing for anyone but Arkansas investors?  Not at all.  Do the American people care?  Nope, they’ll keep saving money now, and paying $40 for a half gallon of orange juice later when Wal-Mart got their wish.

I know of several stores that can compete: Crest and Buy for Less just to name two just in case one of you idiots say, “Name one! Just one!”..dumbest debate question I have ever heard.

Price controls everything. Why should I get ripped off by a smaller store? Why should I get ripped off when I can get my oil changed? Man, don’t you guys wish WM could charge for cheaper gas? Why don’t you demand that? Oh, predatory pricing. I get it. Actually its never happened....not in my memory. Not even Standard Oil. Heck, when they were forced to break up, the price of oil was already coming down (look it up).

All you guys want to do is complain and wait for more thousands of pages of regulation and to unionize when history is telling us today unions fail under their own weight. You have proven you cannot survive on your own. I’m not afraid of WM or Home Depot. The govt charges more than all in taxes and I definitely do not get my money’s worth.

In reality, many of Wal-Mart’s prices aren’t that low compared to other retailers.  They, however, maintain a perception among many in America that they are, and use their so-called advantage of one-stop shopping to convince customers of such.  As for predatory pricing, is not pricing under cost predatory?  I think so.  Wal-Mart can use loss leaders effectively to drive volume when smaller retailers don’t have the luxury.  If you feel Washington isn’t doing enough for you, then vote for the people who you feel will.  And if you feel everyone here is so blatantly wrong, then why do you come to simply attack them?

FACTS

1.  There are no Walmarts in Pottsboro.

2.  The only other grocery store in Pottsboro is a little convenience store which is staying open.

3.  The nearest Walmart is in Denison which is five miles away.

4.  There are eleven grocery stores in Denison, not including the Walmart.  They vary from Krogers to convenience stores.

DISCUSSION

Locals say the prices at Sterling were too high.  In general, the only people who will shop in such stores are those who cannot drive five miles or who do not desire to drive five miles because they only need a limited number of items such as milk or bread.  That is hardly the formula for a successful grocery store.  Other stores in Denison are successfully competing against Walmart

CONCLUSION

Walmart had little, if anything to do with the closing of Sterling.

If Another Bob is right this news story is laughable.  Good try WM Watch.

People have to remember, that the business model that Sam Walton used to create Wal-Mart in the first place, was based on volume sales.  By cutting the profit margin on items, a selling at a lower price, more peole shopped at the store, thus more items were sold, thus more profit was generated.  The main reason most smaller stores can’t compete with Wal-Mart, is that they keep their profit margin high, thus they have higher prices, thus the have lower volume of sales.  The reason Sam Walton was able to grow his business so successfully, was that he could not convince anyone that his business model was viable.  Today, most small businesses, still think that to increase profit margins, generates higher income, which is the opposite of Sam’s model, therefore they don’t get the volume, lose customers and eventually go out of business, is tthat Wal-Mart’s fault or the small businesses fault?  In other words, if Wal-Marts model generates high profits at a low profit margin, why do most small businesses NOT GET IT?

The other thing that WalMart did brilliantly was to realize and harness the power of technology and apply it to their inventory/fullfillment/logistics system. When most retailers were still filling out handwritten inventory sheets and calling in orders to headquarters, WalMart was using technology to consolidate that and other processes. Should they now be excoriated for efficiency? How many hundreds of thousands of jobs have been created because WalMart pushed their industry to modernize? How much productivity gain has made its way into our economy because of this? The price effect of this alone is staggering. It’s unfathomable if you consider the ramifications of that amount of wealth creation from one company. The great thing is that much of it ends up in the pocket of the consumer!

It’s the same mantra that we have heard from levellers, Fabians, communists, fellow travelers and Democrats for all time. If you are successful we must stop you. If you demonstrate that capitalism creates wealth we must stop you. Don’t try to hard because if you become Microsoft or WalMart we will come after you to punish your success and try to turn you into a charity.

Mags, the mantra on the right would be “I should be allowed to be as greedy and selfish as I want without any limits or standards at all and screw everyone else.” You forgot to add Anarchists to your list of anticapitalists, by the way.

No, Generic. That isn’t the mantra of the right. It is the mantra of Capitalism. Greed and self-interest create wealth. Every product or service that is in your home right now is there because of greed and self-interest. The PC you are typing on would either not exist or would cost 10,000$ if no one had wanted to make them for profit.  Self-interest drives and guides the market and keeps people searching for ways to deliver the goods and services people want at ever lower prices. What other reason could there be? You will say well, we should limit peoples profit or take it away from them if they make too much. What is too much? Bill Gates billions have resulted in the creation of entire industries worth trillions in total created wealth. WalMart has done the same thing. They have transformed their industry, created millions of jobs. Advanced new technologies that have increased the overall productivity of the economy. Saved Americans huge amounts of money and provided an abundance and range of goods unheard of in the history of mankind.  All of this on a 3% profit margin which is somehow far too high a reward for their efforts.

Mags,

Nice post. I have often wondered why it is that throughout history, there have always been people who try to tear down instead of helping to build up?  The lower classes, are always blaming the upper classes for their shortcomings and the fact that they refuse to fit within the system, so, they want to destroy that system.

We have seen some posters here complain about the fact that Wal-Mart keeps building new stores and remodling other stores, don’t they see how many jobs are being created in the construction industry because of this?  Even while they condemn imports, they don’t see the U.S. jobs created from it, Ship hands, Dockworkers, truck drivers, and railworkers, warehouse workers, document preparers, the list goes on and on, all have a job because of imports.  And then there are the people who serve those workers, ie: Truck Drivers, have to eat on the road, therefore it creates business for restaurants, and they may sleep overnight in a motel.  Also, there are toll fees collected by the states, plus fuel taxes.  We talk about 1.5 million Wal-Mart employees, but think about the way Wal-Mart adds to peoples lives outside of Wal-Mart itself, the effect is enormous. So many peoples lives depend upon that Wal-Mart effect on the American Economy and the jobs it promotes and the savings it generates for consumers.

Bob in

“Even while they condemn imports, they don’t see the U.S. jobs created from it, Ship hands, Dockworkers, truck drivers, and railworkers, warehouse workers, document preparers, the list goes on and on, all have a job because of imports”

Bob, If we were exporting at the same rate as we are now importing, there would still be the same number of the jobs that you are speaking of. After all we would still have the trucking jobs to haul the products to market, we would still have all the dock workers. We would still have the ship hands.......ect. We would also add too that ,the MANUFACTURING JOBS jobs that have been outsourced China, India, Korea.....ect Your argument that it is somehow good for us to outsorce our $40,000 a year manufacturing jobs and trade it for a $12,000 a year Mcjob assembling hamburgers. Trying to use creative math and somehow do it using addition and not subtracting the jobs lost to outsourcing, is like putting a paper towell over a hole in the floor, it covers it..... until someone steps in it. This type of economy strengthens our would be enemys, and at the same time, only weakens our country.

DAVE SMITH
PROUD UNION IRONWORKER

Hey Ironhead, do you want to bring back the buggy whip industry? I hear they took a real beating when those evil automobiles came in. And you know, we should start a site for all the bank tellers that ATM’s threw out of work. And what about the telegram company, post office and fax machine makers? That Internet thing really screwed them over. How about all those poor people who used to own payphones? Why those cellular phone dandy-fancy-pants people came and invented away their livelihood. And finally, Ironhead this should hit close to home… The typewriter manufacturers. Unpatriotically destroyed by those infernal computinizing machines and unscrupulous software men!

Like species, economies evolve. So you really want to argue for keeping the economy the same as it was in 1970?

IRONHEAD,

“If we were exporting at the same rate as we are now importing, there would still be the same number of the jobs that you are speaking of.”

And, pray tell us all, WHY don’t we have more EXPORTS?  Could it be that other countries want lower prices too?  If a toaster is made in China, and is priced wholesale at $3.00 and another toaster is made in the U.S. and because of the higher wages, (that $40,000.00 job you talked about), was priced at $12.00, how many U.S. toasters, do you think people in other countries will be willing to buy, compared to how many Chinese toasters they will buy?  I too, would like to see people making tons of money each year, but, in order to ‘compete’ in the world market, and in order to export more, your price has to be comparable to those from other countries, or, the quality has to be far superior to the products from other countries.  But, I think you will find that price is the dominating factor.  And, everytime you ask a company to raise wages, that translates to higher prices, which translates to lower exports and more imports for the U.S..  Think about it, how many U.S. items can you sell in China, if they can get the same items at 1/4th the price from somewhere else?

Mags,

And, years ago, when you went to a gas station, 2 to 3 people came out, washed your windows, checked your oil and the air pressure in your tires, and pumped your gas.  Now, you get out and pump your own gas, pay for it with your credit card at the pump and never even have any contact with humans at the station, where did all those jobs go?  Should we bring those jobs back?  And, if we did, what would we have to pay for gas, assuming those people were paid a ‘living wage’ of $15.00+ an hour and given affordable healthcare coverage?  Remember, oil companies make big profits, therefore they can afford it.

As for those ‘buggy whips’, we can always go back and start using buggies again, to save on gas prices, right?  Why don’t we just go back to the 19th century ways of doing things, but use all the savings, to pay higher wages?

Well there is never ending arduement regarding WALLLLZ and it is like sky is the limit. Why dont you all think about the small principal i.e. simple business and in my view if you are keen then you will be on the top. Last month I was in an arguement “National Economic Planning (N.E.P.)” and my topic was FDI inflow in India. For that I had spoken against WAL-MART entring into india in Retail Trade because it will definitely snatch away the businesses of Mom and pop shops which will hurt the Indian or any economy terribly and so on and so forth. I had also given latest datas for how it will hurt the ecnomy by closing ups of 40 million small retailers and at last it will result in growth of robbery and stealing. In my view it is an never ending issue and god bless them all who have been a victim of the same.

Thee are always two sides to every story.  Forget about the unions, forget about the disappearing mom and pop stores across the nation, forget about health care, forget about wages, forget about building abandoment issues,etc.  These are certainly debateable issues.  As an ex-NCO for the US ARMY, we were told--if you want to know what is happening on the battlefield, ask the foot soldiers ("groundpounders").  So I went out and talked to local residents who live near a Wal-Mart “supercenter” Four of them actually and within 12 miles of each other) to get their opinions about convenience and low prices. I heard the same store from approximately 175 residents who live near these four “supercenters"--massive amounts of new vehicles hitting their local streets and neighborhoods, 24-hour noise (delivery trucks, new bus traffic, and the thousands of additional customer traffic), local small businsses from disappearing at an alarming rate(meaning less choices for them), an increasingly homogenized look to their once unique neighborhoods, increased ground water flooding (at two locations) which has the potential to create major property damage (I wonder if that lowers property values?), increased ground debris (garbage) around the “supercenter” locations, and lots of people considered as “undersireable” (by the residents I talked to) loitering in their neighborhoods at all hours of the day and night.  It doesn’t sound like these types of stores add anything to the neighborhoods that they do business.  The other issues of low wages, in adequate health care, sex and gender discrimination, union bashing, environmental destruction of wetlands/woodlands, abandonment and reuse issues, etc. are other sypmtoms of a company that is hellbent on dominating the retail industry by destroying competition.  These stores are ruining the heart and soul of America just to make a buck.  There are more important things about this country than just gathering more market share at the expense of all of us.  For decades, this country was carried on the shoulders of the small business owners--who had genuine concern for the neighborhoods and communities that they used to do business.  The tens of thousands of small mom and pop stores that no longer exist is all the proof you need to see the destruction that these “supercenter"-type stores create.  Land developers call “big box” projects the “nuclear power plants” of the land development industry--MASSIVE, INTENSIVE, and DANGEROUS.  The proof is in your neighborhoods and in the thousands of cities around this great nation.

Bob

“And, pray tell us all, WHY don’t we have more EXPORTS?”

Well Bob I don’t know when exactly you fell asleep? But a very, very, large part has to do with the outsourcing of good manufactoring jobs to China and other places. Another large part has to do with unfair import taxes and unfair trade. The last is because of people like yourself, that would rather see your own countrymen jobless and kids living on the streets than pay a few more cents for for a product made in the USA. Bob I’ll bet you, that you have an American flag, and I would be willing to bet, that your American flag was made in TIWAN. The worst part is, you don’t even see anything wrong with that. An AMERICAN flag .......made in Tiwan.

Mags

What you are talking about in your post are products that have been replaced with newer and more updated inventions. I was talking about the production jobs that make what ever the market is purchasing at any given time. Mags, this must be tough for you to grasp, but there are always going to be newer and better inventions. And of coarse, that is a very nessary thing. But what is important, and I hope I don’t lose you here, is where they are made. If all we do is import then where do all the people that lose there manufactoring jobs go? who buys the imports?

Mags, to be honest, I don’t know why I even bothered to respond to your idiotic post. That thing you wrote had to have brought the I.Q.s of any one that read it, down at least 5 points.

DAVE SMITH
PROUD UNION IRONWORKER

IRONHEAD,

It is funny, that when trying to make a point with you, you totally ignore what is said and go into your union spin.  You say that outsourcing is the problem, but don’t want to admit that it is high wages in this country compared to low wages in other countries that is part of why companies move out or outsource.  The other part, is that higher prices (caused by high wages) is lowering our exports.  It is simple MATH, why is it so hard for you to understand this?  You always go into some sort of rant about what the end result is, but refuse to address the actual problem.  It doesn’t take a rocket scientist to figure out, that if you have $20.00 and I have $4.00, and a doorknob cost $2.00, you could buy 10 doorknobs and I could buy only 2, therefore, it is impossible for someone to sell me more doorknobs than you.  Therefore, as long as people in China, make so much less than people in the U.S., it is impossible for them to buy more from us, then we buy from them.

Like I have said before, you only want to see one side of the story and ignore the other side.  You are so out of touch with Economics, and deal so much on Emotion, that you can’t see that what you say, is in direct opposition with what you want.  You are so set on people getting MORE, that you refuse to see that sometimes LESS IS MORE.  Example: In the city you live in, let’s say, that the rent for a 2 bedroom apartment is $600.00 a month and the average wage is $15.00 an hour, while in another area, the average wage is $30.00 an hour, but, the rent on that same type of apartment is $1,500.00 a month, okay?  Who is better off financially, the person making $15.00 or the guy making $30.00?  Even though the guy who makes only $15.00 is making LESS, he has MORE disposable income, because his rent is less than half of the guy who makes twice as much.  But, if you raise the pay of the $15.00 an hour guy, and if it goes up to $30.00 an hour over time, at a point, he would be paying $1,500.00 for rent and therefore, would have LESS disposable income.

And, because you don’t seem to understand the basis for cost of living, you can’t understand the MORE IS LESS concept.  And, because you can’t understand the Economic differences involved with TRADE, you can’t understand why our imports are more than our exports.  Until you open your eyes to the “Big Picture”, you will only SEE a small part of it.

Bob

“Even though the guy who makes only $15.00 is making LESS, he has MORE disposable income, because his rent is less than half of the guy who makes twice as much.”

Bob, okay lets just take this real slow, so you will see how truly bad your logic is.

$15.00 per. hour X 40 hrs. = $600.00 X 4.3 weeks to the mo. = $2580.00 per mo - rent of $600.00 = $1980.00 this is his disposable income..........$1980.00

$30.00 per hour X 40 hrs. = 1200.00 X 4.3 weeks to the mo. = $5160 - rent $1500.00 = $3660.00 This is his disposable income.......$3660.00

Bob, being a self proclaimed financial wizard, perhaps you might tell me wich is a larger sum? $1980.00 OR $3660.00. I don’t think that I need any financial advice from you Bob. Acording to your theory a $2.15 per hour job would have an even greater amount of disposable income than say, Lee Scott’s salary. I have to hand it to you Bob that is some creative financing theory you have there. Walmart should have you convincing their associates that they need to pay walmart to work for them, then you could show them the millions that they have would have in disposable income. better sharpen your pencil!

DAVE SMITH
PROUD UNION IRONWORKER

It’s sad, moreso because the Pottsboro locally owned store closing is only one in an endlessly long line of independently owned stores/businesses that Walmart has driven out. People think they are doing so well going to Walmart, but what they don’t realize is that once Walmart has virtually no competition (and that day seems to be fast approaching) it can charge whatever it wants and where are you going to go if you don’t want to pay “their” price? America has either knowingly or unsuspectingly created a huge, Pac-man like monstrosity, an ugly thing with no ambition except to rake in the money. Let those who get in the way be damned as far as Walmart is concerned. When you get to the size that Walmart is right now (with a net worth more than that of many nations in the world), you also wield tremendous power. When it decides to use that power to get its own way in things, as Walmart has time and time again, (see story about “Nazi signs” among others) then the “little guy” is going to be stepped on every time.

At the same time Channon, it is becoming less and less cool to shop and support Walmart.  More people seem to be ashamed to support a company that disrespects Canadian labour laws because it feels its above the law.

IRONHEAD,

Yeah, I guess you are right, unless you take into account things like Taxes, Social Security and Medicare deductions.  You are talking Gross, I am talking Net.  Besides, it is not only rent that makes up ‘cost of living’, higher wages cause higher ‘cost of living’ across the board.  Example, what are the gas prices in high income cities, as compared to lower income cities?  Food prices are usually lower in low income cities as compared to high income cities.  The old adage, “The more you make, the more you spend” comes into play here, if local businesses know that you have more money, they know that you will be willing to spend more, so they jack up the prices.  Also, Local taxes ( sales and property), are usually higher in high income areas.

Channon in Fort Smith, AR,

Tell us, has Wal-Mart run out all the businesses in Fort Smith?

“but what they don’t realize is that once Walmart has virtually no competition (and that day seems to be fast approaching) it can charge whatever it wants and where are you going to go if you don’t want to pay “their” price?”

And, if that were to happen, you would see others step in and build stores and charge lower prices (It’s called competition) and Wal-Mart would have to go back to what they were charging before or lose sales and customers.  Tell us one example of where Wal-Mart has driven out all the businesses and is now charging whatever they want, (I assume you mean outrageous prices)?

Channon-

People think they are doing so well going to Walmart, but what they don’t realize is that once Walmart has virtually no competition (and that day seems to be fast approaching) it can charge whatever it wants and where are you going to go if you don’t want to pay “their” price?

Let’s say this did happen (it won’t for many reasons including, but not limited to, other big box retailers, government interference, and Bob’s explanation above) and Wal-Mart became a monopoly.  Even then, they would not be able to charge whatever they wanted.  Monopolies are still bound by the market demand curve because consumers will not pay more for an item than it is worth to them.  Price and quantity provided would be set to maximize profits, and something tells me you wouldn’t move much orange juice at $100 a jug.

One thing for sure.....if Wal-Mart would charge $100 a jug for orange juice, they would still argue that the so called “associates” can’t be paid anymore because of their business model.

There are not always two sides to every story. Why would anyone with common sense think that?

Someone, agree.... that day will never come...nor has it ever unless the govt has control, then they can charge whatever they want without a lawsuit.

Predatory pricing or charging cheap to drive everyone out of business and THEN charging as high a price you want is ONLY A THEORY...UNPROVEN! Would someone please provide evidence and prove me wrong? Someone will always and has overcome a monopoly.