The Lies Wal-Mart Tells: Wal-Mart’s Overseas Sourcing

bfd every other company buys and imports from overseas and how come none of you walmart haters on here ever bitch and moan about the all the others including your favorites buying from overseas?answer that.of course you cant.

“Wal-Mart ruins Rubbermaid. In 1994, Rubbermaid won accolades as the most admired company in the United States—but five years later, its fortunes fell so hard that the company sold itself to a competitor. When the price of a key component of its products went up, Rubbermaid asked Wal-Mart for a modest price increase—but Wal-Mart said no, and stopped sales of Rubbermaid products. At a Rubbermaid factory in Wooster, Ohio, that meant the loss of 1,000 jobs”

Poor business practices and the increase in the price of the “key component” are what destroyed Rubbermaid not Walmart.  Walmart accounts for less than a quarter of retail sales if Rubbermaid had had any kind of business sense they would have been able to absorb the loss of Walmart’s business. 

Also a couple of the stories were companies that “had to” move to China to get Walmart’s business.  If these businesses actually cared about their employees they would have refused and just sold their stuff at other retailers.  The fact that this didn’t happen shows that either they didn’t care about their employees (in which case the outrage should be with them for selling out their employees instead of with Walmart for trying to get a lower price), or they couldn’t find anyone else that would sell their crap (in which case these companies just weren’t that good and probably would have gone under anyway).

Poor business practices and the increase in the price of the “key component” are what destroyed Rubbermaid not Walmart.  Walmart accounts for less than a quarter of retail sales if Rubbermaid had had any kind of business sense they would have been able to absorb the loss of Walmart’s business. 

Untrue. As Wal-mart has contracts with manufacturers for products, quantities, and price, which of course is controlled by Wal-mart. Another classic example of this is Vlassic Foods. When a company is forced to continue producing goods and selling at a loss, the outcome is in-evitable. And of course, since there is a contract, they don’t really have a choice. Its either fold or give in. This works in favor of Wal-mart of course, since if they fold, they purchase the company name, re-label products imported from China, and the average consumer never knows the difference or actually cares.
Businesses are in business to do business. If the #1 retailer in the world, who does the total sales of the next 4 combined, doesn’t carry your product, will you succeed? Probably not based on historical financial records. Manufacturers of retail items whose products are NOT carried by Wal-mart only have a 8.6% chance of staying in business for greater than 3 years. So the statement that Rubbermaid should have just sold their products elsewhere was not an option not only due to contractual obligations but impending loss of their entire company, which would have resulted in even more layoffs and lost jobs than the present result.
Also, the statement that companies “Had to move to China”. Do a little search for the term “China Cost” (That’s what Wal-mart execs refer to it as) and make your own judgement.
As far as “selling crap”, I don’t know if you remember Rubbermaid products of the past (you may not be old enough) but I remember running over my Mom’s trashcan, a Rubbermaid one, with my car as a teenager, and just pulling it out from under the car and it was okay. Now a days, I can crack one down the middle with a wiffle ball bat. Hmm, I wonder why the quality went down?

Shanon,

“And of course, since there is a contract, they don’t really have a choice. Its either fold or give in.”

Gee, that sounds exactly what can happen to a company, when they have a ‘contract’ with a union!!  It’s no wonder that Wal-Mart is ‘smart’ enough to try to persuade their employees not to join a union!!

Before ANY company signs a contract, they need to make sure that it allows for changes that might affect them adversely, if not, then it is their own fault!!

“Manufacturers of retail items whose products are NOT carried by Wal-mart only have a 8.6% chance of staying in business for greater than 3 years.”

Tupperware, a rival of Rubbermaid, doesn’t sell at Wal-Mart, yet, they have been in business MORE than 3 years, how can that be, if your theory is true?  Also, I have seen MANY brands that Wal-Mart does not sell, that are able to stay in business, selling only through other outlets!!

Hmm, I wonder why the quality went down?

Since you obviously know so much about it, why don’t you tell us? 

I own several Rubbermaid products, and they’re all USA-made…

Shannon, what you have to understand about bbrd and RDS is they live in an ‘ideal’ world. In their reality there are always ‘inefficiencies’ to be squeezed out without sacrificing quality. There are no limits and the Law of Dinishing Returns does not exist.

Wal-Mart’s stuff is cheaper than everybody else’s because it’s crappier than everybody else’s.

“Wal-Mart really is about driving the cost of a product down,” says James A. Wier, CEO of Simplicity Manufacturing, a lawn-mower maker that decided to stop selling to Wal-Mart. “When you drive the cost of a product down, you really can’t deliver the high-quality product like we have.”

Diminishing

“Manufacturers of retail items whose products are NOT carried by Wal-mart only have a 8.6% chance of staying in business for greater than 3 years.”

I would love to know where you go that number from.  Considering most major name brands do not sell at Walmart I’m going to have to say that it is either a completely made up number or the companies that do sell at Walmart have only a 9% chance of staying in business.  Also yes these companies want to do as much business as possible, but you guys bash Walmart for trying to do the same and say that it is the sign of greed.  So Walmart is bad for trying to make money, but their suppliers are good for trying to make as much money as possible.

...but their suppliers are good...

There is nothing good about supplying Wal-Mart.

“If you care about a local economy, you will hate Wal-Mart.” ~ Rosemary Atkinson

“Our company is firmly committed to the philosophy by buying everything possible from suppliers who manufacture their products in the United States” [Sam Walton, Wal-Mart Press Release, 3/13/85]”

Gee, a statement from 23 years ago, things change over time you know!!  Twenty three years ago, we were not in the Global Economy, to the extent we are today!!

shannon the same crap from china and etc you are whinig about walmart selling is sold at all your favorite stores.mam you have no understanding of busines sense at all.walmart does not put others out of busines.its all about competetion.your favorite stores are competetive and you dont bitch but walmart does and you throw a childish hissy fit.walmart has no control over what other places charge for items shannon so quit your whining and stop blaming one company when everyone else including all your favorite stores do the same dam thing.

ken always gas his head so far up his rear end its sad.ken stupidlt believes everything the pile of crap ufcw union brainwashes him with on here.ken is not smart enough to realize that not everything on here about wm is the truth.a lot of b.s. on here.

RDS,

You hit the nail on the head. All three of the “lies” are quotations from Sam Walton, who died in 1992, while all of the “truths” are no earlier than 2003. The Research Team had best do a little more research before they post next time. That goes for Shanon, too.

Twenty three years ago....

Twenty three years ago Wal-Mart was Sam’s Dream. Now it’s the Beast of Bentonville. Twenty three years ago Wal-Mart’s profitability was through the roof. Now it’s marginal.

It’s amazing that Sam was able to build the largest corporation on the planet without the help of his evil spawn and Lee Scott.

Ken V,

“Twenty three years ago Wal-Mart’s profitability was through the roof. Now it’s marginal.”

How can anyone expect a company to raise wages and benefits, refit their truck fleet to ‘green’ trucks, ‘Green Up’ all of their stores, keep prices ‘low’, hire MORE employees, give everyone MORE hours, give MORE to charities and disasters and all of the other things suggested that they should do, when they only have “MARGINAL PROFITS”?

You make it sound like Wal-Mart is almost bankrupt and your side is WINNING the battle!!

Re:conflict of laws;when laws one state and/or country may apply to case.Conflict of interest,where your own self interest can lead to violate your duty.A conflict need not even be intentional.Conflicting board of directors,public servant and family member vs. private employers and family members.

...when they only have “MARGINAL PROFITS”?

That’s the point, RDS! Wal-Mart isn’t good at either; being a soicially responsible company or making a respectable profit from their enormous effort (unless you are a Walton or upper level management).

Ken v,

You have seemed to miss the point, that the companies that followed your train of thought, are now the ones slowly going out of business, while the Wal-Mart model is the one that is succeeding!!

What other retailer, is following YOUR business model and even coming close to overtaking Wal-Mart?  Explain, why it is, that the ‘quality’ products, you talk about, are not being bought by most people, if ‘price’ is not the motive?  So, how will raising ‘quality and price’ entice people to buy more, thus, cause that type of business to grow?  Explain, why an average homeowner, would be ‘better off’ buying a ‘quality’ MILWAUKEE power drill for $140.00 over a BLACK AND DECKER drill for $19.95?  How many ‘holes’ does the average homeowner drill in their lifetime, that they would require the higher priced, ‘quality’ drill?

You can CLAIM that Wal-Mart purchased products don’t last, but my EXPERIENCE has been that you are wrong!!

BTW: What toilet paper do you recommend as being of ‘high quality’?

...the ones slowly going out of business, while the Wal-Mart model is the one that is succeeding!!

Jut which busineses are you refering to? Wal-Mart was unable to run KMart completely out of business despite planting ‘ringers’ in the corporation and in it’s major supplier.

High on a wall inside Wal-Mart headquarters is a paper banner with a provocative question in big block letters: “Who’s taking your customers?” Beneath it, “Wanted” poster style, hang photos of the CEOs of two dozen of America’s largest retailers—Target, Kroger, Winn-Dixie Stores, Walgreen and so on. None looks very happy, perhaps because they know that the only way to get off the wall is to fail utterly. Although Kmart reorganized under the federal bankruptcy code, a photo of its CEO continues to hang in Wal-Mart’s rogues’ gallery and no doubt will remain there for as long as Kmart operates even a single store.

“entice people to buy more”

That’s really what life’s all about for you huh?  He who has the most useless shit when he dies wins!

Ken V,

“Jut which busineses are you refering to?”

Ever hear of places like Woolworths, Montgomery Wards, Coast to Coast, and Ben Franklin?  As for K-Mart, it had filed for bankruptsy in the past and is only viable for it’s real estate, soon, because of it’s merging with Sears, it will morph into one single chain, probably called Sears!!

wm didnt put out` k-mart kenny boy.k-mart did itself in pal by refusing to be competitive and lower its prices.

...wm didnt put out` k-mart...

Um, matthew...no one “put out’ k-mart”.

Ever hear of places like Woolworths, Montgomery Wards, Coast to Coast, and Ben Franklin?

<i>"There is no perceived risk in attacking Wal-Mart anymore. They have gone from being a business success story to being a cultural villain.” ~ Eric Dezenhall

Ken V,

I didn’t say that they were “out of business”, I said the were “slowly going out of business”, none of the ones mentioned is what it once was!!

Ever hear of places like Woolworths...

Notes for all:

The Woolworth’s chain in the U.K. that Kenbo hyperlinked to hasn’t been related to the now-defunct five-and-dime since the 1980’s (the U.S. company changed business models and became what we know today as “Foot Locker").

As for Wards, only the name survived to be attached to an internet-only business (again, no relation to the historic department store which went bankrupt and ceased operations in 2001).

Of the three mentioned, only Ben Franklin survives with the majority of their 300+ stores being arts-and-crafts shops (the old-school five and dimes are only in America’s smallest towns).

Um, matthew...no one “put out’ k-mart

Try telling that to the shareholders of Sears Holdings (SHLD) who lost $100 a share since this time, last year.

...it will morph into one single chain, probably called Sears!!

I might’ve believed that a couple of years ago, RDS.

However…

As both Kmart and Sears’ mall-based stores are becoming somewhat “dated” in comparison to their competition, I don’t expect either chain to survive over the next 10 years.

As * once said, they are the stores to go to for Kemore appliances and Craftsman tools.  True.

That said, I expect those brands to be sold to one of the big home improvment chains, then the stores will fold.

bbrd,

“Try telling that to the shareholders of Sears Holdings (SHLD) who lost $100 a share since this time, last year.”

Or, he could talk to the old K-Mart shareholders, like me (I had 2500 shares), who lost their entire amount of money!!

“I don’t expect either chain to survive over the next 10 years.”

Having Eddie Lampert’s track record, I believe you might be right, I believe the main reason he put this deal together, was not to build a retail business, but rather to cash in on the real estate!!  Selling out the Die Hard, Craftsman, Kenmore and Lands End Brands, could net a tidy sum as well!!

Speaking of craftsman products I bought something a few weeks ago from sears , GUESS WHERE ITS MADE

CHINA .

Or, he could talk to the old K-Mart shareholders, like me (I had 2500 shares), who lost their entire amount of money!!

Another instance of RDS making good choices. Tell me, RDS, how much of your loss was absorbed by taxpayers as a write off?

I’m not even slightly interested in debating which busisess evolved into what or what business moved to which country. All I’m pointing out is if a pro Wal-Marter posts ‘facts’, even the casual reader needs to beware!

Ken V,

“I’m not even slightly interested in debating which busisess evolved into what or what business moved to which country.”

That’s what we expect from you, when you get caught ‘spinning in the wind’!!  And, don’t worry about the casual readers, they can see your twisting what others say as well as anybody!!

“Of the three mentioned, only Ben Franklin survives with the majority of their 300+ stores being arts-and-crafts shops (the old-school five and dimes are only in America’s smallest towns). ~ bbrd

Also, these stores are franchise stores and not owned by Ben Franklin!!  Used to be, that there was a Ben Franklin in most towns!!  If I’m not mistaken, Sam’s Five and Dime, was a Ben Franklin and Sam presented his retail concept to them and they rejected it, saying it wouldn’t work!!

‘spinning in the wind’

Actually, RDS, I’m impressed you got 25% of you facts straight. As far as “slowly going out of business”, that’s a little vague don’t you think? Let me give it a try:

The anti Wal-Mart Movement is slowly eroding Wal-Mart’s profit margin!

The sun is slowly burning out!

We are all slowly dying!

Ken V,

Guess you will believe only what you care to believe!!

“As far as “slowly going out of business”, that’s a little vague don’t you think?”

I would think that a business that was all over and everybody knew them and shopped there, and now there are hardly any left, could be considered “slowly going out of business”, Wal-Mart seems to be getting bigger all the time, so your “The anti Wal-Mart Movement is slowly eroding Wal-Mart’s profit margin!”, statement, is only speculation on your part!!

...only speculation on your part!!

The role the Anti Wal-Mart Movement is playing in Wal-Mart’s decreasing profit margin may be speculation. The decreasing profit margin is not!

2008— 3.4%
2007— 3.3%
2006— 3.65%
2005— 3.65%

Anyone remember the “glory” days when Wal-Mart made over 9% profit?

Walmart is a big scam. They not only buy junk products from china, they also sells refurb electronics without telling the customers and most of them go bad within few months to a year when they are outside of the return window

everyone else buys the same junk crap from china too and we dont hear shit from you on that so quit your bitching about wm doing it so zip your lip italian companies

everyone who does not love and worship wm is a communist but not like the chinese kind that wm supports more than anybody else you hypocrites