Wal-Mart and China’s Human Rights Abuses
Amnesty International has taken the 2008 Beijing Olympics as an opportunity to highlight China’s legacy of human rights violations, and to call on the country to change its practices. The Olympics may stand for all that is strong and vibrant in the human spirit, but the Chinese government’s policies of forced labor, censorship, arbitrary police detentions, and unjust executions fall miserably short of these lofty goals.
Wal-Mart sources more than 70% of its products from China, and relies on this atmosphere of abuse and oppression to keep production costs low. The issues Amnesty International raises are precisely why Chinese factories can manufacture products for so little: most workers are too afraid to stand up for better working conditions, and understandably so. Without these intimidating working conditions, Wal-Mart would have a much tougher time keeping its prices so low.
Wal-Mart might be in a joint venture with China, but Wal-Mart’s heart lies with exploitative working conditions, not the Chinese people. Surely once China’s labor standards improve far enough, the retailer will move on to a country where working conditions remain medieval and workers’ rights are nonexistent.
China’s Olympic Legacy [Amnesty International]
Posted by Alex Goldschmidt on Monday, August 04 | 8 comments | Permalink
“We’re Sorry” Means “We’re Sorry This Information Got Out”
Yesterday we posted a story from the U.K. about a list of “requests” Asda’s magazine purchaser made of its suppliers. Among the set of outrageous demands: profit improvements, new fees for store space and two pages of editorial space in every publication.
As is so often the case with Wal-Mart, once its exploitative behavior was exposed to the light of day the retailer backpedaled furiously, said the demands were “a mistake” and blamed some poor low-level executive.
This isn’t an isolated incident, however, of Wal-Mart using its power unfairly. The statement of one publishing industry insider could be applied to any one of a number of industries that Wal-Mart has relentlessly bullied in to lowering prices:
“Its absurd demands show a complete failure to comprehend the costs of producing a magazine. A demand for two pages of advertising/editorial in each magazine is tantamount to blackmail.”
For those who argue that Wal-Mart’s monopsony is good for consumers, think about a world where corporations write your magazine articles. Wal-Mart’s marketplace dominance might mean lower prices, but it seems unwise to trust a corporation with so much power.
Asda admits ‘mistake’ in magazine distribution row [Brand Republic]
Asda has told Campaign that it made a mistake when it asked magazine distributors to grant it free editorial space in titles of its choosing.
Magazine publishers have branded Asda a “schoolyard bully” after it proposed changes to distribution arrangements that insiders say would “devastate” the industry.
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Posted by Alex Goldschmidt on Thursday, July 31 | 4 comments | Permalink
Wal-Mart’s Asda Demands Editorial Space to Sell Publisher’s Magazines
Publishers blast Asda editorial demands [Brand Republic (U.K.)]
Asda has waded into a row with publishers over its plans to plans to force magazines to give the grocer free editorial or advertising in return for shelf space.
Asda has emailed a number of magazine distribution companies requesting two pages of editorial or advertising space each month, as well as a request for £2,500 for shelf space for each new Asda store opened. The supermarket company is also asking that any new title distributed in its stores will be subject to an ‘item set up’ charge of £2,464.
An industry insider told Marketing that Asda’s plans showed a ‘shocking lack of understanding of the costs of producing a magazine.’He said,‘With the rising cost of paper, many of these retail demands are totally inrealistic and highly unprofitable for specialist publishers.’
A spokesperson for Asda said that the email was a starting point for discussions. ‘The email sets out a number of proposals aimed as a starting point to begin discussions. As with any negotiation, both parties have a wish list which will quickly change as middle ground is sought and an agreement that suits both parties is found.’
Asda is also asking the publishers ‘hurdle rate’ for new titles carried in stores, which means if sales of the magazines are 20% less than forecast the supermarket will be compensated with the difference.
Posted by Stephanie Lee on Wednesday, July 30 | 0 comments | Permalink
Wal-Mart’s Deal with ACFTU
Wal-Mart strikes deal with ACFTU [Shanghaiist]
Dan Harris of China Law Blog brings us an interesting take on the new pay deal Wal-Mart struck on Friday with the All-China Federation of Trade Unions (ACFTU) in Quanzhou, Shenyang, and Shenzhen.
As reported by Forbes, the U.S. retailer operates more than 100 of its namesake stores throughout China and employs 48,589 people. Its new agreement with its employees in Shenyang calls for an 8% pay increase in both 2008 and 2009. Harris remarks that a pay increase of the same amount next year sounds strange, since there’s no telling what inflation will be a year from now: “Is this an admission by Wal-Mart that it wasn’t paying enough?” he asks.
The deal further marks Wal-Mart as “something of a poster child” for the Chinese government’s drive to get all foreign-owned enterprises to recognize the ACFTU, Forbes writes, since it comes two years after Wal-Mart allowed the union to organize at its local outlets. “What happened to Wal-Mart is no surprise,” Harris adds. He continues:It is just another step in China’s efforts to move away from being a destination for foreign companies seeking super low paid workers. Just as with so much else in China, we are seeing foreign companies getting out in front in terms of going along with what China wants to do with its economy. Domestic companies are and will continue to follow in terms of having to deal with unionized and higher paid employees… anybody who still thinks China will do anything for foreign investment is living in the past. Times have changed and China is getting more and more selective in terms of the foreign (and even domestic) companies it wants.
Posted by Stephanie Lee on Wednesday, July 30 | 0 comments | Permalink
Asda Targets Gamers with Newly Launched Magazine
ASDA targets gaming market with customer mag [Brand Republic (U.K.)]
Asda will target gamers with the launch of a new dedicated magazine boasting a circulation of over 2m.
The quarterly magazine will be called the Asda Games Magazine and will be a free reviews-based publication aimed at building on Asda’s position as the second largest games retailer in the UK behind Sainsbury’s.The magazine, which is aimed at the family market rather than experienced gamers, will have the largest circulation of any games magazine publication in the UK, and its launch is part of a sales growth plan over the next three years with family gaming a key area.
The retailer said that the magazine is a key innovation in supporting this growth by offering uniquely targeted information and advice to the core Asda mums market.
The first issue is available in the August Asda Magazine as an insert and the magazine is also part of a wider Asda Games First initiative, which includes new ranges in-store, new fixtures and more space dedicated to games.
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Posted by Stephanie Lee on Wednesday, July 30 | 0 comments | Permalink
The Wal-Mart Effect, 2.0
I realize that we are Wal-Mart Watch, not Loblaws Watch- however, there was no way I could pass up the chance to talk about this story. The London Free Press reports today that Canadian retailer, Loblaws, is cutting wages and change the name of “rebranding” its stores in London, Canada so that it can compete with discount retailers like Wal-Mart. This will also allow them to bypass their union contract with UFCW.
If anyone ever questioned Wal-Mart’s global impact and the strength of their mere existence, this situation should lay those concerns to rest. Wal-Mart’s expansion into the Canadian grocery market has led to Loblaws demise and pathetic attempts to compete at the expense of its workers. It’s interesting to note that Loblaws, while trying to battle the behemoth Wal-Mart, is taking a page right out of their handbook of putting profits before people. It’s good to see that Wal-Mart brings out the fighter in everyone- and the claws. What’s next Loblaws? Are you going to start discriminating against your women employees and denying adequate health care to your staff? Clearly, that is the path to success in the global retail environment.
Loblaws rebrands and cuts wages
London’s three remaining Loblaws stores will undergo major changes that include new names and lower wages for workers.
The company is slashing wages and hours and rebranding its London stores as it struggles to compete with discount food stores, a union official says.
The Loblaws store on Southdale Road is under renovation to become a No Frills. The Wonderland Market at Wonderland Road South and Southdale Road and the Richmond Market at Richmond Street North and Fanshawe Park Road will be renamed in the fall.
Loblaw can cut wages under a new store banner, said Tony Soares, secretary-treasurer of Local 1000A of the United Food and Commercial Workers, the union representing store workers.
“This is all about wage reductions. They cannot compete with the discount grocery store competition and they want to lower wages so they can lower prices to compete with the likes of Wal-Mart,” Soares said.
Read the rest of this story ...
Posted by Vasudha Desikan on Wednesday, July 30 | 4 comments | Permalink
Wal-Mart’s Competitor to Set Up Integrated Purchase Center for Asia
Tesco Set Up Purchase Center In Shanghai [China Retail News]
The British retail giant Tesco has set up a purchase center for Asian areas in Shanghai.
The purchase center will be responsible for transferring and allocating goods for more than 600 Tesco stores in China, Japan, Thailand, South Korea and Malaysia.
Founded in 1919, Tesco has owned more than 3,200 stores worldwide. Although the company set up its purchase and distribution headquarters in Europe a long time ago, its Asian purchase resources had not been integrated.
Referring to the delayed establishment of the Asian purchase center, a person in charge of the center told local media that it is because of the consideration of stabilization. As the company’s store coverage in Asia has been developed to a certain degree, optimizing purchasing resources becomes a natural step.
Tesco said that the reason for choosing the northwestern area of Shanghai as the location of its Asian purchase center is that there are many purchasing headquarters of Chinese and international retailers, including Metro, Lianhua, and Hualian, in this area, which increases Shanghai’s attraction for global retailers.
Posted by Stephanie Lee on Tuesday, July 29 | 0 comments | Permalink
Competiton for Wal-Mart Soars in Sichuan
Carrefour To Double Number of Stores In Sichuan [China Retail News]
Carrefour China western regional manager Arnaud Dupont said that the group plans to open five new stores in Sichuan province over the next three years.
The supermarket chain already has five stores in the provincial capital Chengdu. Dupont said that the May 12 earthquake had not changed the group’s positive assessment of the Sichuan market.
Dupont also disclosed that on July 16 he signed an agreement with the local authorities to open a store in the popular resort city of Dujiangyan which was badly hit in the May 12 earthquake with the loss of more than 3,000 lives. He said the decision to invest in Dujiangyan had been made before May 12 but remained sound on commercial grounds.
Dupont said that to date Carrefour Group has donated CHY23 million to the quake relief and reconstruction effort and an ongoing initiative has so far raised a further CHY4 million.
Carrefour Group is the second largest retailer in the world after Walmart. It currently has 117 stores in mainland China and 40 stores in Taiwan. It opened its first Taiwan store in 1989 and its first mainland China store in 1995.
Posted by Stephanie Lee on Tuesday, July 29 | 0 comments | Permalink
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