Has Walmart become or is it becoming a Monopoly in America.
I remember when I was growing up in a community where there were small community supermarkets and appliance stores all around the town. There were Drug stores and hardware stores, bakeries, and fish markets in walking distance all over town. Walmart drove almost all of those small business operations out of business.
K-mart, woolworth, TG&Y, and small furniture stores were closed are downsized. I heard yesterday Sears was closing down, last month I heard JC Penny was fighting for its survival. Will the majority of workers in America be working for Walmart five or ten years from now, parttime at minimum wage?Walmart is an American success story of epic proportion. Sam Walton knew what he was doing buying in monumental volume to feed the most industrious of manufacturers all the while satiating the consumer with the most ridiculous of low prices. A marriage made in heaven and a model for all other capitalistic aspirators such as Target, Home Depot and Costco. Buy in bulk, sell with massive savings to a consumer driven populace. Only trouble soon reared its head as the smaller store chains and Mom & Pop stores went under with no where near the purchase power of WM. What to do? Is it fair to demonize WM for using American ingenuity spawned by capitalistic principles? What has the morals driven hoard done to act in accordance with their judgment of WM? Go to the WM and continue in their faux pas. The real trouble will come when WM has driven all the competition out of business and can charge whatever they wish without a care in the world.
Have you considered that it isn't WalMart "driving almost all of those small business operations out of business"? That it is the customers that are refusing to pay more for less, refusing to purchase from those higher priced stores, that is "driving them out of business"?
Outside of merely existing, WalMart need do nothing but offer what people what - fair quality and very low pricing. The people will do the driving FOR the Waltons.If you read and comprehended the two aboves post, you wouldn't asked if customers go to Walmart to pay less. Rather then be disagreeable, why not give an answer to the point. Is Walmart a monopoly or a monopoly want to be?
From the OP: "Walmart drove almost all of those small business operations out of business. ". Which is what I responded to. If you find the response disagreeable, perhaps you should re-think your automatic hatred of WalMart.
But to answer the monopoly question, I can't think of a single item at WalMart that is not available in a dozen different stores.
By definition, then, WalMart is not a monopoly. It may or may not be a monopoly in a very limited geographical area somewhere, but certainly not the company as a whole.
It depends on how sparsely populated your area is. I live in a high density area and the mom-and-pop stores do just fine. The Walmart is on the edge of town and actually less convenient for many people, cheaper sure, but for many people it's just not worth the time to drive or take public transit out that way. But in small towns Walmart is definitely changing the retail market.
In not so small towns as well. I live in a suburb of Boise, Id (big town, small city) in the second largest town in Idaho.
There are 3 WalMart's within 5 miles of my home and a fourth going in. Within 10 miles there are (guessing) perhaps 10. Yes, it is changing shopping in my suburban area.
After seeing the responses to your post, it seems any mention of Walmart evokes passionate responses.
It would probably be more accurate to ask if Walmart's business model is... etc...
Competition is what it is. The failing of business after Walmart comes to town just means that their business model/practices are not strong enough to stand competition.
I think the Walmart tsunami will lead to a redefining of small businesses in small towns. More specialty and niche' businesses, instead of general "small scale" Walnarts like Sears, Penny's and mom and pops.
I do not think Walmart will be the defacto retail employer of the future. I think the small businesses in Walmart areas will adapt and survive. They will find other customer magnets besides price.
As Wilderness says, it is not a monopoly because its products are available elsewhere. The customers have a choice.
I do not think not will be a monopoly in the future for the same reason. American entrepreneurs are both creative and determined. Just look at the giants of the past that have been unseated by upstarts.
GAI knew Walmart was no an absolute monopoly, I just wanted to provoke thought. You make perfect sense but the upstarts America's businesses are being unseated by is the largest business upstarts in the world economy. (China)
Yes, I have been watching the news about China's developing economic prowess, but is that a bad thing for reasons other than knocking the U.S. out of first place? Wait, don't answer that question here. It would hijack this thread. I will start a new one.
GAYes, GA Anderson my post was written to shine a light on China's economic prowess and their conspiracy to knock the US out of first place. This tread has already been hijacked and turned into a defense of walmart selling cheaper and inferior tarps and the benefit of that for the poor. Wages and jobs that are affected by Walmart's selling cheaper and inferior goods made in China that their employees barely can afford because of the low minimum wage is ignored. The right to be wrong is exercised to not have positive dialog between those with different view or agendas. Thats the way the forum game is played here and everywhere.
LOL! Good observation. Another rant could be made for "why is communism good for capitalism?". With the exodus of jobs from the US to labor markets that run under communism why is it the US can't support it's own society with it's form of government and business tactics?
I started a China thread for you. Find my reply there.
GA
.... Competition is what it is. The failing of business after Walmart comes to town just means that their business model/practices are not strong enough to stand competition.
I think the theory you express is right and perhaps it is the glut of products in one location that draws consumers into their doors. I have found that with the Walmart purchasing power they can regulate and in some cases dictate how something is packaged and sometimes manufactured to drive the price down. I recently tried several times to buy a tarpaulin to cover a few things temporarily. I went to Walmart and purchased a tarp and when I took it out of the package several of the eyelets poured out of the bag and went jingling on the ground. Need less to say the tarp lasted barely a month when the eyeletless holes ripped and the material deteriorated to where it fell apart. I went to several hardware stores and found they had the same make of tarpaulins on their shelf at amazingly the same price. I eventually went online and found much better tarpaulins at a slightly higher price ($10.00) and they have lasted for over a year. So what is to make of this story. Maybe consumers are satisfied with cheap junk that barely suits their needs and to get anything more you need to go nationally to satisfy quality. So who is dictating the quality and price?Quality is not WalMart's forte, that's for sure.
Ultimately it is the consumer dictating the quality and price in a free market, competitive system. Others use governmental controls where price is determined by committee.My post was to illustrate that in this instance the opposite is true. Because Walmart has created through its purchase power a manufacturer/supplier who sells at a price and quality under what another manufacturer can supply they have caused a product of lesser quality to be the benchmark that most others follow. ie. the local hardware stores. Now I am sure that the quality tarp I bought is probably available in hardware stores elsewhere, the local stores wish to compete with the same product as Walmart on a cost basis and screw the quality issue. How many are faced with the same circumstance as I or an emergency purchase to address the immediate problem at hand and not worry that the product they just purchased is running the other quality based product out of business. Of course if in the future after the quality product is no longer available as it has been driven out of business by the lesser quality item it is discovered a quality substitute is needed again maybe some company may step up and reproduce a quality substitute. But the consumer is usually too lazy or unaware that this is going on.
I would disagree - it is still the customers that are setting the price at WalMart. They have done it in the tarp matter by buying crappy tarps instead of good ones, convincing WalMart that that is what they want. You, on the other hand, have cast YOUR vote by buying elsewhere (the second time) but most likely your vote will not come through on the winning side and the crappy tarps is what will remain.
I also question why anyone would want to compete with WalMart on price - it is almost impossible to do so. So the hardware store that wishes to stay in business will not try - although they may (or may not) carry the same crap, they will compete on service. Or appearance or aisle width or anything else but price.Perhaps you have not understood. The consumer is buying what is provided as the other more expensive tarp is not offered. There is a dominance in the market that Walmart has developed because of its purchasing power and providing only what it wants to sell is also a control it has with an unknowing consumer. In a theoretical setting you are right but the practical outcome is showing a different story.
As far as the smaller stores selling at the same price it is not impossible as some are members of a buyers group such as Ace and True Value where they buy in combined huge lots that give them the ability to compete. That is in hardware but Walmart buys across all types of consumer goods.Why is the other tarp not offered? Because people buy the crappy one and WalMart takes notice of that, then providing only that tarp because no one will buy the more expensive one.
The consumer has once more set the basic price.No the consumer has been convinced Walmart will always have a product at the right price. The better one is not offered because why? Because they don't need to with so many of their customers brainwashed into thinking Walmart has the best buys out there. The consumer has been duped again.
The chicken or egg? WalMart will sell whatever produces the higher profit; in most cases that will be the one with the most volume (particularly in the WalMart business scenario). If the better quality is what is wanted, the consumers will choose it and volume will rise; if lower quality is wanted consumers will choose it and the volume of THAT will rise. Presumably that's what has happened and WalMart thus offers the crappy tarp.
Otherwise you are saying that WalMart guessed as to what people want, and all other sellers in the area followed because WalMart is infallible - a picture I would deny.
But you must also never forget that the "best buy" always has a quality consideration in the equation. The best buy for a cordless drill, for instance, is very different for the professional using it all day long than for the homeowner that uses it twice a year.I see you cannot see beyond what you believe to be true. Accepted thought to a fault, so I can't reason with you on this again. I applaud and condemn this thought process of yours. It must be comforting to know you are right. In the inverse line of thought nothing can change either.
It IS comforting, and probably more so than the paranoia of always thinking someone else is out to get you for everything you have. More than spending your life as our distant ancestors did, simply replacing the sabre tooth tiger with WalMart and other paper corporations, and forever fearful you will be eaten by them (in a manner of speaking).
Reality actually is more comforting than conspiracy theories, at least to me. And so is the idea that my decisions really DO have at least some impact on the world around me.I am glad for you. A simple life has its merits but it also limits ones imagination.
So it does, but it also limits the false "knowledge" that imagination provides to all too many. "Knowledge" like WalMart running the world and setting prices without regard to demand or the willingness of consumers to pay that much.
If I may jump in, you may be right, or you may be wrong.
I say this because it is almost assured that the profit margin on the more expensive tarp would be much better than the one on the cheapest tarp. I understand that shelf space is a premium, but would Walmart pass up the opportunity for higher profits - if there was any market, (folks like you, 2nd time around), at all?
Ok, let's all race to Walmart and see if the cheapest tarp is the only choice offered.
GAI am a tradesman by way of forty years and also a business owner for twenty years. I am up on the market especially when it comes to trade related tools and expendables. I have inquired at both the Walmart and local hardware stores why it is that they stock these inferior quality tarps. The answer I get is because they sell them pretty regularly and in one case I was told I was the first to ask about them. My point is that the stores seem to buy what sells with little regard for quality. It may also be a planned obsolescence is computed so regular purchases can be made as the product prematurely wears out. Is this a Walmart conspiracy that the smaller hardware stores are a part of or is it about just selling as much product no matter how inferior it is and be damned with any definitive analysis? After all it is just a $30.00 tarp you can by two or three times a year or you can buy a $65.00 tarp online that will last three times a long. The better tarp has saved me over $100.00 and maybe that does not mean much to others.
"The answer I get is because they sell them pretty regularly"
That's what I said, too - the customer is making the choice and WalMart follows along with it. What's so hard about that to understand, and why does it have to be changed into some kind of massive conspiracy? It's what the customer wants, it's what WalMart will sell. No conspiracy needed, just good business sense.
Not everyone wants to pay for top quality. It isn't worth it to the consumer to pay $300 for a good Dewalt cordless drill kit when a B&D is available for $50 and will do their once a year job just fine. You want top quality, go to a store that specializes in quality and where the customer base is more concerned about that than it is about price. That's not where WalMart competes, that's not it's customer base and as a result it's not the products it carries.
As far as the tarp - if I'm moving and concerned about it sprinkling on the furniture in the back of my pickup, I'll go to WalMart to buy a tarp to cover the couch for 30 minutes and one trip across town. If I want to cover my woodpile for the year I'll go somewhere else and buy a good one.You really are so tooled up to disagree with me you lack the ability to read the nuances I refer too in my answers. Of course there is no conspiracy and I never said there was one. It was a stupid question to hook those that want to believe there is one. You are completely right and here comes the lack of imagination I spoke of. Since Walmart already has the cheaper tarp locked up and selling they could maybe offer a little variety in selling some quality products. But as unimaginative as you are so are they and as the smaller produced quality items are overtaken by the cheaper large volume products so our options dwindle. It is like everything else in this country. In the schools we need more science and math skills taught so the budget allows for it and music and sports programs are impacted or eliminated. Is music and sports less popular because of it? Just because the popularity of something grows its impact it does not exclude other possibilities that when ignored are lost in the process. Maybe you should climb back into that simple comfort zone again and discount everything I have said now.
"Is this a Walmart conspiracy..."
Perhaps not an outright accusation of conspiracy, but very, very plainly a strong insinuation there is one.
"they could maybe offer a little variety in selling some quality products"
Why? Because you want one? It is outside their business plan and expertise and there is almost nothing to gain from the risk, thus no reason to do so.
"unimaginative"? And yet they are perhaps the most successful company in the world. That doesn't happen from the "unimaginative".
And perhaps you should consider that rhamson isn't running WalMart, doesn't understand where their profit is coming from and doesn't understand their business plan. WalMart doesn't want to be the corner hardware store; it wants to the the premier low cost store in the world and it is very successful at that. That you want higher quality and are willing to pay for it is insufficient reason for WalMart to change that plan.I have had problems with your comprehensive skills before. Your ever ferocious appetite to be right and the tenacity with which you pursue it is monumental. Your comprehension is the culprit here and your bias has set it up. I cannot help your deductions as as you said yourself you seek to keep things simple. Why do you venture outside of it is my only question?
Oh, I comprehend just fine - as long as the words match what the writer is trying to say.
Why am I venturing outside what? Simple things? But why WalMart sells cheap tarps IS simple! WalMart sells cheap tarps because it fits into their business plan (be the best low price seller). And it doesn't sell expensive tarps because that does NOT fit into their business plan of selling low cost items.
That is all very simple - it is only when someone tries to turn it into some kind of conspiracy ("Is this a Walmart conspiracy...") that it takes on some complexity but even then it is just a matter of saying "No, there is no conspiracy" or "WalMart doesn't sell what you want because you don't want what they sell". WalMart, not you, will make the decision of what products in their best interests to sell.I can't tell as the tangent you are occupying your time is absolutely not germane to what was said. Sorry to disappoint you but what I said about a conspiracy was for a ludicrous comparison. But if the shoe fits by all means go ahead and wear it. And I am glad you are capable of dissecting Walmarts marketing plan. Do tell us more. You really can look ridiculous at times.
I take it you figured out you weren't making much sense so resort to insults - the final refuge of many in these forums. I'll say that the WalMart business strategy is centered around high volume/low pricing, but beyond that it isn't worth commenting on any more.
You have a good day and may we meet again where your personal prejudices against a large corp. doesn't control your posts.Insults have not even been a part of what I have said in trying to reason with you. I will concede that this, as with many other conversations with you turn south when I ask a little more than I guess you are capable of. It always seems that in trying to understand and explore something you come up with the same conclusion. Everything is just the way it should be and no change is necessary. You are definitely an inside the box thinker and when I try to get you to look beyond the bias of your opinions on matters you always go back into your comfort zone. I feel sorry for you in that thinking inside the box is where we are all headed anyway but a little enlightenment in our journey there is refreshing if you can stand it.
Do you two need a referee? I think psycheskinner would volunteer.
GANo need I will self censure my replies so as to allow others to make sense of the information offer. I am sorry for my outbursts and hope that I have in no way been a part of your retiring from these forums. I hope you find the time in the future or at least reconsider maybe a shorter period of participation. Your thoughts and open mind has been refreshing..
OH Geez, what retiring? My schedule just dictates that my participation be late evening, Eastern time. I wouldn't miss the fun of these forums for anything. And I doubt, an argument with, or objection to, anyone would result in anything more then a change in tactics.
So don't let me slow you down.
GA
OK, I got the "can't repeat a post" error msg. so I had to add a little verbiage to try to fool the auto-monitor...
my message is:
"Do you two need a referee? I think psycheskinner would volunteer."
GA"I ask a little more than I guess you are capable of"
"You really can look ridiculous at times."
"You are definitely an inside the box thinker and when I try to get you to look beyond the bias of your opinions on matters you always go back into your comfort zone."
"but a little enlightenment in our journey there is refreshing if you can stand it."
"I have had problems with your comprehensive skills before."
"Your ever ferocious appetite to be right and the tenacity with which you pursue it is monumental"
"Your comprehension is the culprit here and your bias has set it up"
"...you lack the ability to read..."
"...and here comes the lack of imagination I spoke of"
"But as unimaginative as you are..."
"Maybe you should climb back into that simple comfort zone again..."
Thanks anyway, GA, but this thread has crossed the line for me and isn't worth pursuing any more. I can handle some rudeness, but when the only words being put out are insulting there's nothing in it for me.
But the next time you and I put the gloves on by all means, give Psyche a call.No referees, no rules. And I even promise to raise your kid when you go down, if you promise to do the same for me if you should get lucky.
GA
rhamson, to comprehend or not to comprehend that is the question, not tarp prices. Is tarp Walmarts biggest seller or is it food?
The Tarp issue has been blown out of proportion. It was just an example of where availability sometimes dictates the market price. In Walmarts case it might be an artificial aberration because the consumer accepts what is given them because it is what Walmart determines is acceptable. My contention is that the product is of such low quality and is the only thing on the shelf and in a pinch of time you are left with no other choice. That alone sets an unrealistic benchmark as to what the consumer will accept at the price. I have talked with a few people (not here) who have discovered the same situation. It is not going to alter the world but it is an observation as to how the purchasing power of a huge chain store can dictate the marketplace.
I don't know about groceries.
rhamson, have you considered that these "substandard" quality products you don't like - have greatly increased the buying power of the poor in the US? Whether it's a tarp - a candle - or a child's bicycle, poor families can afford to buy items they couldn't just 40 years ago - and that's all due to Walmart. Perhaps the quality isn't that of a bicycle sold at a bike shop - but it's a fraction of the price and a child doesn't have to feel left out because he's the only one in the neighborhood without a bike.
Clothing - much of it from Walmart is of mediocre quality - but guess what? Those little children still outgrow those items before they wear out most of the time. How is it that you don't recognize that aspect of increased buying power?
Walmart is not a monopoly. Walmart is not the devil. Walmart has increased the quality of life for many.
That's worth something after all.This whole thing has gone sideways as my intention was not to pick on Walmart per ce as Target, Home Depot and such practice the same business model. My whole point is that through its business model and its buying and marketing power it can drive the influence of a segment that does not necessarily promote the best available product. All of the other opinions offered do not address this point. Is it profitable for Walmart, or does it work for Walmart as compared to is it the best outcome for the consumer was my direction. Sorry to confuse and get dragged into nonsense as I sometimes do with a certain someone.
Strictly speaking, Walmart does not qualify as a monopoly, which is created when an entity controls the *exclusive* sale of a product - and can therefore raise the costs of that product.
Walmart is an example of free market and supply and demand at its best. If, for some reason, other competitors drop away and WM raises their costs - other companies would once again be able to start up and operate by offering slightly lower costs.
I read a couple of weeks ago how organized labor was upset at Obama for singing Walmart's praises over their switch to using renewable energy.
It's tough to beat WM, and little retailers need to offer something different in order to survive. By the way, mom and pop retailers have traditionally been at the bottom of the pay scale for their workers as well, so it's not like it really makes a difference where a stocker or clerk works these days.
Related Discussions
- 117
Is Wal-Mart good for America?
by WorldCup~2010 13 years ago
We are talking about Wal-Mart at school right now and there are two sides to this story. The bad side is how Wal-Mart is moving all of their manufacturing jobs over seas which ends up having a negative effect here in America. But also, Americans are getting rock bottom prices on most goods Wal-Mart...
- 16
Where is the SEC on these large companies...?
by Jack Lee 6 years ago
We have these large companies like GE and Amazon and Google...where they seem to be too big to fail...Why does our anti-monopoly laws not apply here?We allow these companies to grow and buy and merge with competitors...and then when they get too powerful or too big to manage...we wonder why they...
- 15
Is Walmart Representative of All Future Retail Business?
by qwark 14 years ago
Is Walmart the "archtype" of future retail business?Will small business be forced out of competition?What chance does a "small business entrepreneur" have of being successful?
- 97
Corporations are Ruining America.
by Kathryn L Hill 11 years ago
How?
- 160
WalMart Asks Workers To Donate Food To Its other Needy Employees
by Stacie L 11 years ago
November 18, 2013 | Wal-Mart doesn’t pay its employees enough of a wage so that they can afford to buy quality food for Thanksgiving. So one store in Cleveland had a novel idea: launch a food drive for its own employees. It’s targeted at the low-wage workers who could afford to...
- 53
Walmart questions
by r2moo2 13 years ago
I was just doing a little study on Walmart, as I was updating my Boyfriend Gift Ideas blog, and found out that many companies went bankrupt because of Walmart.As I am in a country, Singapore, which does not seem to have direct influence from Walmart, I want to ask how it has been for you, and your...