wal mart

[Harlock]

rynier, your post is confusing. Mirro closed down because of Wal-Mart? Wal-Mart carries Mirro pans... I bought my last Mirro fry pan there...

 

[dwayne]

Why would someone even WANT to go to a mom and pop store and pay more for stuff, when there is a WalMart right up the street? I don't get it. I work hard for the money I make. It's not my fault that mom and pop are being driven out of business. I'm not going to pay $10 for a hammer that I can get at Home Depot (ahem, I mean WalMart) for $6. "Support" the small stores? How about "support" my own wallet? Tough luck mom and pop, but someone's doing it better and cheaper.

Example: My husband is prone to athlete's foot. He uses this cream called clotrimozole when he has an outbreak, which can be purchased at CVS, Walmart, Target, etc... I keep one or two tubes at home at all times just in case... it isn't cheap. One tube at CVS is about $6.99. I can get the same size tube at Walmart for $3.89. Guess where I buy the cream? That's just one example. I DO a ton of shopping at cvs, mainly because the closest walmart to me is 1/2 hour away... but there are things that I stock up on and only buy at Walmart.

WalMart "invented" their type of store, same as Microsoft "invented" the internet browser... anti trust is all BS in my mind... it's jealousy flat out - People were jealous of Bill Gates's smarts, business savvy and products, so they slapped him with the anti trust suit.

I also agree with Tom, it's not difficult work pricing merchandise and running a cash register... why should we feel bad for these people who are making minimum wage or a little bit more than that? I don't get it. I'm NOT putting anyone down who does this for work, I'm just stating my point of view.

 

[Harlock]

dwayne hit the nail on the head. Why support mom and pop places when I need to save money to put my kids through college? Sorry, the bottom line is I can't afford to look out for mom and pop unles they are my mom and pop. My family and my finances will take priority over keeping a mom and pop in business. Period.

Sure, I can support the mom and pop. Pay 20% more for the same product and more personal service and keep both mom and pop in business. Or, I can go to Wal-Mart, pay much less for no personal service (and really, what do I care? I can carry my bags to the car and know what I am looking for anyway!) and keep a store that employs 200 people or better in business.

 

[tomm10]

rynier, your post is confusing. Mirro closed down because of Wal-Mart? Wal-Mart carries Mirro pans... I bought my last Mirro fry pan there...

Walmart does harm some vendors with their pricing policies. Ever wonder why an item you can't find anywhere on the planet for less than $99.95 sells at Walmart for $95.97? Walmart uses their ridiculous size and buying power to muscle their vendors into selling them their products at extremely low prices. Often, these prices are less than what it costs the manufacturer to make them (when overhead, etc. are factored in).

The vendors do this because they NEED to be in Walmart. Placement in Walmart forces other stores to sell the same product while paying closer to the real wholseale cost.

That works fine for some manufacturers but smalle ones can't pull it off. Its not out of the realm of possibility that some manufacturers would go under as at least and indirect result of this practice although I have no knowledge of examples.

As someone who has seen the vendor side of Walmart I can tell you its a big, scary company. I'm generally wary of ANY company that gets as large an powerful as Walmart, Coca Cola, etc.

 

[slipknottin]

Walmart uses their ridiculous size and buying power to muscle their vendors into selling them their products at extremely low prices.

Which is a good thing.

Often, these prices are less than what it costs the manufacturer to make them (when overhead, etc. are factored in).

Extremely unlikely and very rare. Maybe temporarily but not for any length of time.

Placement in Walmart forces other stores to sell the same product while paying closer to the real wholseale cost.

Huh? Having my product selling in walmart is going to force other stores to sell my product for closer to wholesale cost?

 

[tomm10]

Which is a good thing.


Extremely unlikely and very rare. Maybe temporarily but not for any length of time.


Huh? Having my product selling in walmart is going to force other stores to sell my product for closer to wholesale cost?

Well, I haven't worked for the companies to whom this has occurred so I guess you'll have to make up your mind as to whether or not you accept it as truth but for an example, a certain notebook and paper product maker routinely sells their products to Walmart at below their cost. They do this because Walmart tells them its the only way they will carry the product. In this companies eyes, it is worth it to take the loss because being able to tell the Targets, and Staples of the word that they have X linear feet of product on display at Walmart gets them enough cachet to force those stores into committing to buy a comparable amount of product since they are in direct competition. Since the manufacturer has the leverage in this situation, the stores pay the full whosesale price and have to sell the product for more than Walmart does.

In a different example, a sunglass maker sells an amazing amount of sunglasses through Walmart. They pay to have a company design and manufacture displays that hold hundreds of pairs of sunglasses. They fill the displays with their product and then ship them to Walmart stores individually. Only, Walmart refuses to pay for them. They know that sunglasses are a high theft item so they pay for the glasses on scan only. That means the manufacturer is paying for any shop lifted glasses. We heard many cases where entire displays of 300 glasses were accidentally left in a backroom of a Walmart until the season was too advanced. Once it was discovered, they simply threw it away. Thousands of dollars worth of merchandise, thrown away. No sweat off Walmart's nose, they didn't pay for it.

Look, its successful capatalism and I understand that but these manufacturers get their money somewhere. They have to. If Walmart pays them so little, they have to charge more elsewhere. Sooner or later everybody pays for that somewhere along the line.

 

[slipknottin]

In this companies eyes, it is worth it to take the loss because being able to tell the Targets, and Staples of the word that they have X linear feet of product on display at Walmart gets them enough cachet to force those stores into committing to buy a comparable amount of product since they are in direct competition.

But your argument was that this drives some companies out of business. If this company sees selling to walmart at a loss to be a benefit, then its going to be saving or making them money, not costing them money. If it was truly costing them money, they would not supply walmart below cost.

If Walmart pays them so little, they have to charge more elsewhere. Sooner or later everybody pays for that somewhere along the line.

Not true. Competition has always and will always lower the economic profits that businesses can make. Businesses dont have to make an economic profit, they want to. In perfect competition, economic profits are essentially eliminated, and businesses can still function quite fine.

 

[Jason01]

Where I live, the nearest "big box store", walmart, is a 45 Minute drive away - 35 MILES of HIGHWAY. The only reason I go to these towns that Wal mart is in is because of walmart. If walmart wasn't there, I wouldn't go to that town. I do go to the small stores in that town, but most of them are specialty stores. They have things that wal-mart doesn't. Keep in mind, the county that I live in is like 50 Sq. Miles, and only about 10,000 ppl live here. Work is scarce, and I spend my very hard earned money as wisely as possible. If that means buying from a place that has the ability to buy in bulk, then so be it. You also can't say that the small store can not buy in bulk. They choose not to. If you're gonna bash wal-mart for helping the little guy, why don't you go after other stores, especially ones that buy in bulk...Like K-mart, and the like. I buy most of my groceries at cut-rate places like aldis. Sure, there is nobody in the store(workers), and you have to wait 15 min. to check out, but where can you get a can of Tuna for 29 cents?

 

[tomm10]

But your argument was that this drives some companies out of business. If this company sees selling to walmart at a loss to be a benefit, then its going to be saving or making them money, not costing them money. If it was truly costing them money, they would not supply walmart below cost.

Not my argument. I said it was conceivable that following these practices could INDIRECTLY put a company out of business. While this practice works for some companies like this large paper maker I mentioned, a smaller company might not be able to pull off the same thing if their product isn't compelling enough to the other retailers. They may not be able to make up the difference they gave up to Walmart. In the end though, engaging in a practice that loses money consistently is pretty bad business and not really Walmart's fault.

Not true. Competition has always and will always lower the profits that businesses can make. They do not always retain the same profit margin.

Okay, forgive me here, Slip, because I never studied business so I'm only going off of my common sense here. I understand that competition lowers prices and therefore profit margins. In my mind though, when a company as large as WM shaves prices on their vendors as close as they do, someone pays. The manufacturers have costs from their own vendors and except for the largest of them, they can't force them to take less like WM does to them so, they have to make it up somewhere. That means other retailers pay even more to make up for the losse on WM, right? Its either that or cut corners somehow.

The problem, again this is to my uneducated mind (not a shot, I'm serious), is that such aggressive business practices could eliminate competition rather than encourage it.

 

[tomm10]

You also can't say that the small store can not buy in bulk. They choose not to.

Ya, the same way I choose not to be a millionaire. Small stores physically cannot buy in the same bulkk as Walmart since they don't have the distribution. Walmart has what, hundreds (at least) of stores worldwide as opposed to the mom and pop's one location and your argument is that mom and pop should buy 1500 tons of dog food a year?

The days of mom and pop operations are pretty much gone except for unique and service based businesses I think. Its been moving there for a while though so it shouldn't be a surprise. The world is getting smaller.