Walmart

[Syd the Human]

Okay, so I occasionally hear about people complain about how this megastore hurts small business, and I'm not denying that it does.

But, the issue I have is, when exactly is a store supposed to limit its success? Walmart, if memory serves, started out as a small business until it became the success that it is today. I am sure the people behind it worked really hard. When are they supposed to stop working as hard? What is the barrier they are not to cross?

I hope I worded that clearly enough, please let me know if I'm not making sense.

 

[Armoured]

Okay, so I occasionally hear about people complain about how this megastore hurts small business, and I'm not denying that it does.

But, the issue I have is, when exactly is a store supposed to limit its success? Walmart, if memory serves, started out as a small business until it became the success that it is today. I am sure the people behind it worked really hard. When are they supposed to stop working as hard? What is the barrier they are not to cross?

I hope I worded that clearly enough, please let me know if I'm not making sense.

It is a fine line to tread. I too, bemoan the loss of "Mum and Dad" specialty stores where the owners know their customers personally and can spend half an hour to give each individual tailored advice, but then I do my groceries at large chain box stores. If we're honest, I think a lot of it comes down to us wanting to have our cake and eat it too. We want the personal small scale touch, but at low prices and with the convenience of having everything in the one place that only comes from a large retailer.

The sad fact is that really, the smaller retailers are hold overs from a time when people needed to be able to access most of their day to day needs within walking distance, from a time before virtually everyone had a car and driving to a centrally located large store was practical.

In truth, the only thing stores like Walmart et al need to do, IMHO, is provide an appropriate standard of employment for their workers and pay a fair price to their suppliers. If people aren't prepared to pay extra to subsidise the personal small scale stores that 9 times out of 10 don't have everything you're looking for, well, then that connection to our pre-centralised and globalised past is going to die out. People will complain and wail about how terrible that is, but at the end of the day, if they shop at Walmart instead of Surly Joe's Little Hardware Shop (Imperial measurements ONLY!) well, money talks, as they say.

 

[Johnnz]

The issue is a moral rather than a political or purely economic one. The misuse of power especially against society's vulnerable was strongly denounced by the prophets, and the story of Lazarus is about his indifference to the poor man outside his gates.

John
NZ

 

[Armoured]

The issue is a moral rather than a political or purely economic one. The misuse of power especially against society's vulnerable was strongly denounced by the prophets, and the story of Lazarus is about his indifference to the poor man outside his gates.

John
NZ

See, you say that, but how often do you go out of your way to pay more at an independent retailer?

 

[Received]

You slow down on success when you have a significant advantage over the market such that, in this case, small businesses are affected to the point that they can't compete with you. The grander goal here is balance your particular company's profit with increasing aggregate demand for the market as a whole, which big corporations don't do when they push out the competition through lower prices, and 70% of a company's costs are payroll-related, which means the people working there are usually getting paid too little relative to how much their work is worth, or at least too little relative to what would keep the economy as a whole running at 4-5% annual growth (because of higher aggregate demand, given that the poorer folks have more money from the corporations who otherwise are jipping them of it).

 

[Johnnz]

See, you say that, but how often do you go out of your way to pay more at an independent retailer?

If I can I will. But today so many companies use 3rd World labour it can be hard to source alternatives.

John
NZ

 

[Armoured]

If I can I will. But today so many companies use 3rd World labour it can be hard to source alternatives.

John
NZ

Well, that's a different issue again.

 

[True Scotsman]

It is a fine line to tread. I too, bemoan the loss of "Mum and Dad" specialty stores where the owners know their customers personally and can spend half an hour to give each individual tailored advice, but then I do my groceries at large chain box stores. If we're honest, I think a lot of it comes down to us wanting to have our cake and eat it too. We want the personal small scale touch, but at low prices and with the convenience of having everything in the one place that only comes from a large retailer.

The sad fact is that really, the smaller retailers are hold overs from a time when people needed to be able to access most of their day to day needs within walking distance, from a time before virtually everyone had a car and driving to a centrally located large store was practical.

In truth, the only thing stores like Walmart et al need to do, IMHO, is provide an appropriate standard of employment for their workers and pay a fair price to their suppliers. If people aren't prepared to pay extra to subsidise the personal small scale stores that 9 times out of 10 don't have everything you're looking for, well, then that connection to our pre-centralised and globalised past is going to die out. People will complain and wail about how terrible that is, but at the end of the day, if they shop at Walmart instead of Surly Joe's Little Hardware Shop (Imperial measurements ONLY!) well, money talks, as they say.

The Walmart in our small town has not hurt the smaller stores and I actually prefer to go there because the employees actually ask if you need any help. At Walmart you're really lucky if you can find anyone. All of the small shops along the main street are still there and the small hardware store just built a new store.

 

[Armoured]

The Walmart in our small town has not hurt the smaller stores and I actually prefer to go there because the employees actually ask if you need any help. At Walmart you're really lucky if you can find anyone. All of the small shops along the main street are still there and the small hardware store just built a new store.

Cool.

Good luck keeping it that way. If people in your town are prepared to pay extra for good customer service, those main street businesses stand a chance.

 

[lupusFati]

Wal*Mart, in my experience, treats their employees as little more than second class citizens. They are not paid enough relative to their work, and I even was 'let go' during my first three months (probationary period for employment), despite letting them know I had a disability. I worked harder than a lot of fellow employees, and yet I got the axe.

Sigh. Wal*Mart doesn't care about you. They only care about profits.

 

[chrisstavrous]

Okay, so I occasionally hear about people complain about how this megastore hurts small business, and I'm not denying that it does.

But, the issue I have is, when exactly is a store supposed to limit its success? Walmart, if memory serves, started out as a small business until it became the success that it is today. I am sure the people behind it worked really hard. When are they supposed to stop working as hard? What is the barrier they are not to cross?

I hope I worded that clearly enough, please let me know if I'm not making sense.

Sounds exactly like what south park said about starbucks, and yes it makes sense.

 

[KCfromNC]

Okay, so I occasionally hear about people complain about how this megastore hurts small business, and I'm not denying that it does.

But, the issue I have is, when exactly is a store supposed to limit its success? Walmart, if memory serves, started out as a small business until it became the success that it is today. I am sure the people behind it worked really hard. When are they supposed to stop working as hard? What is the barrier they are not to cross?

How about using tax dollars to subsidize their profit margins : Report: Walmart Workers Cost Taxpayers $6.2 Billion In Public Assistance - Forbes

If the company is taking that much government assistance, it is time for the government to step in and make sure the company is using our tax dollars appropriately.

 

[sarxweh]

Can success ever be limited?

I think maybe the question could be "how should success in business be defined?"

But then, the nature of business is that one person or group of people design the system to make THEM successful at the expense of OTHERS.

This is why the gospel is "upside down." God started a "company" which profited through self denial.

Business can also orient itself to this, and I think its an important question to answer, "what is the gospel for owning and structuring a business?"

The world began in a perfect garden, and will one day be a perfect city! Business must be held accountable to the vision of the gospel - the good news of the kingdom of God ON EARTH as it is in heaven.

 

[Albion]

Okay, so I occasionally hear about people complain about how this megastore hurts small business, and I'm not denying that it does.

But, the issue I have is, when exactly is a store supposed to limit its success? Walmart, if memory serves, started out as a small business until it became the success that it is today. I am sure the people behind it worked really hard. When are they supposed to stop working as hard? What is the barrier they are not to cross?

I hope I worded that clearly enough, please let me know if I'm not making sense.

Megastores do hurt the competitors, and we feel aggrieved for them, but the people in the community are not required to shop at Walmart. They do shop there, of course, and why, if it hurts the small stores? It's because they get quality at lower prices, so when they then gripe about the big, bad Capitalists, I think they imagine they might otherwise shop at the local Mom and Pop store but still pay 20% less for everything. That's not possible, just as we can't make everyone use renewable energy, never coal or petroleum, but still have the same lifestyle that we do at present.

 

[contango]

It is a fine line to tread. I too, bemoan the loss of "Mum and Dad" specialty stores where the owners know their customers personally and can spend half an hour to give each individual tailored advice, but then I do my groceries at large chain box stores. If we're honest, I think a lot of it comes down to us wanting to have our cake and eat it too. We want the personal small scale touch, but at low prices and with the convenience of having everything in the one place that only comes from a large retailer.

I think this is a really good point. If I go to my local hardware store I'm served by either the owner or his brother, and they know every single thing they have in their store. It's small but it's rammed full of things in every corner. I can describe a product and they'll find it, they can offer at least some advice on what tools I might need, and if they don't have something they can suggest where I might find it.

If I go to the big box stores they've got a much wider range but I have to find stuff myself. The staff there typically know nothing and care even less, if I can't define exactly what it is I need the chances are they won't be any help at all, and there's often very little sense of whether the product is right or not. If I buy from them and find it's the wrong thing I can take it back, but that just means I have to go out there again which is a hassle I don't need. They also have no concept of stock control over and above "the computer says we have one", and unless the computer says they're out of stock they don't reorder. That means you can find really useful things, like when you want shelf brackets and find they have one in stock. I've always found shelves are most useful when supported at both ends, but this pearl of physics is lost on the big box stores.

A large part of the problem is, as you say, the way people want the low prices but also the personal service. When people are willing to go to the place that offers the personal service from people who understand the problem, take the free advice, and then go the big box store to save a few bucks, they shouldn't then be surprised when the personal service disappears.

The sad fact is that really, the smaller retailers are hold overs from a time when people needed to be able to access most of their day to day needs within walking distance, from a time before virtually everyone had a car and driving to a centrally located large store was practical.

When the small retailers actually know the product they are selling they can add value far over and above "we're a dollar cheaper". But the model only works if people play fair.

In truth, the only thing stores like Walmart et al need to do, IMHO, is provide an appropriate standard of employment for their workers and pay a fair price to their suppliers.

If Wal-Mart and the other big-box stores paid staff more they would be more likely to hire people who knew their product lines and cared enough to make sure their customers were satisfied they were buying the right things for their needs. If they paid suppliers enough to ensure quality rather than driving the price as low as possible there would be fewer quality control issues. The trouble is both those steps would result in an increase in sticker prices, which isn't very good if your primary selling point is your low prices. And as before it only works if everybody plays fair. If the giants like Wal-Mart decide to pay their suppliers a little more but the suppliers just use the money to increase their profits rather than improving the quality, it just means the end customer pays more for no benefit.

If people aren't prepared to pay extra to subsidise the personal small scale stores that 9 times out of 10 don't have everything you're looking for, well, then that connection to our pre-centralised and globalised past is going to die out. People will complain and wail about how terrible that is, but at the end of the day, if they shop at Walmart instead of Surly Joe's Little Hardware Shop (Imperial measurements ONLY!) well, money talks, as they say.

Very true. It's interesting to hear how people complain that Wal-Mart or Amazon or Tesco or whoever is driving the small guys out of business, when the person who is really driving the small guys out of business is the one who spends their money at Wal-Mart rather than in the small guy's shop. The fact Wal-Mart exists doesn't mean anybody has any obligation to buy stuff there.

 

[Albion]

I think this is a really good point. If I go to my local hardware store I'm served by either the owner or his brother, and they know every single thing they have in their store. It's small but it's rammed full of things in every corner. I can describe a product and they'll find it, they can offer at least some advice on what tools I might need, and if they don't have something they can suggest where I might find it.

If I go to the big box stores they've got a much wider range but I have to find stuff myself. The staff there typically know nothing and care even less, if I can't define exactly what it is I need the chances are they won't be any help at all, and there's often very little sense of whether the product is right or not. If I buy from them and find it's the wrong thing I can take it back, but that just means I have to go out there again which is a hassle I don't need. They also have no concept of stock control over and above "the computer says we have one", and unless the computer says they're out of stock they don't reorder. That means you can find really useful things, like when you want shelf brackets and find they have one in stock. I've always found shelves are most useful when supported at both ends, but this pearl of physics is lost on the big box stores.

I agree with all those points, but it's obvious that most people prefer Wal Mart to Mom 'N' Pop Store. Why? Because the benefits and drawback you outlined are not seen by them as equally important.

It's interesting to hear how people complain that Wal-Mart or Amazon or Tesco or whoever is driving the small guys out of business, when the person who is really driving the small guys out of business is the one who spends their money at Wal-Mart rather than in the small guy's shop. The fact Wal-Mart exists doesn't mean anybody has any obligation to buy stuff there.

Exactly.

 

[contango]

I agree with all those points, but it's obvious that most people prefer Wal Mart to Mom 'N' Pop Store. Why? Because the benefits and drawback you outlined are not seen by them as equally important.

Maybe people are going to the small store to get the useful advice, then going to Wal-Mart to save a couple of bucks. Maybe they know what they want, or would rather find everything under one roof even if it's not quite right than have to visit multiple places. Maybe price is the most important driver to them and they just go to Wal-Mart because it's cheap and don't even realise that better products exist. There are all sorts of reasons why people choose one over another.

Sometimes it's hard to support the local retailer. My local bike shop has always been very good to me and has looked after me very well since I first bought a bike from them. But sometimes what I need isn't in stock there - as a small retailer they can only stock so much. If I can't go in and buy it there and then, it's harder to support them. I can wait several days for it to come in, lose the freedom to decide I didn't want it after all and pay more or less retail. Or with a couple of mouse clicks it can be on my doorstep tomorrow and for 25% less and if I change my mind I can return it for a refund.

Of course when you're running the business based on being there yourself you can only work so many hours. It always struck me as strangely ironic when shops are open during normal office hours, when the people who have jobs and can therefore afford to buy the products are at work. Then when the working people get home from work all the shops are shut, so they go to places like Wal-Mart because if you've got a seemingly bottomless supply of people willing to work all hours for minimum wage you can stay open all day and all night.

That said it's easy to see how the retailers who know their products and care get driven out of business, when they pay over the odds to attract and retain good staff only to end up doing little more than providing free sales advice for their competitors who pay minimum wage and hire staff who neither know nor care.

 

[Albion]

That said it's easy to see how the retailers who know their products and care get driven out of business, when they pay over the odds to attract and retain good staff only to end up doing little more than providing free sales advice for their competitors who pay minimum wage and hire staff who neither know nor care.

Very true, but then again, some of the big box stores complain that the customers pick the brains of THEIR salespersons and then go online to buy.

 

[OldWiseGuy]

Small retailers will always have a place, but the growth in retailing will continue to be big box stores and the internet. That's just the way it is. The problem really isn't who is selling the stuff but who is manufacturing it. And even then it's a matter of trade balance. Cheap imports won't hurt us if balanced by equal value in exports. And this is in the hands of the Commerce Department. Sadly they collude with the Administration and the State Department to use global commerce, via trade agreements, to advance 'foreign policy'. There are many rats in our economic woodpile.

 

[RDKirk]

Small retailers will always have a place, but the growth in retailing will continue to be big box stores and the internet. That's just the way it is. The problem really isn't who is selling the stuff but who is manufacturing it. And even then it's a matter of trade balance. Cheap imports won't hurt us if balanced by equal value in exports. And this is in the hands of the Commerce Department. Sadly they collude with the Administration and the State Department to use global commerce, via trade agreements, to advance 'foreign policy'. There are many rats in our economic woodpile.

I agree that trade imbalance is the real problem.

Internet: I know two ma-and-pa brick-and-mortar businesses that leaped on that bandwagon, opening onliine stores. They both revamped their brick-and-mortar facilities. One, in fact, sold the downtown store and simply started working out of their farmhouse, rebulding the barn into a warehouse.

The other changed most of their sales floor to warehouse space and changed to a professional-support mode (appointment only) in the brick-and-mortar location. Both are doing well. The fact that "on the Internet nobody knows you're a dog" means that small companies can compete on it with larger ones. IOW, the Internet is an equalizer.

As for the service issue, I am not seeing that as generalizable different between the ma-and-pa shops and the big box stores.

Having the item in stock that I want is certainly the most important element of service. I am not served at all if they don't have what I need. The big box stores win on that except in the area of highly specialized markets.

The staff at our local Home Depots and Lowes all seem to know exactly where everything in their stores is located, and the old guys know as much as ma-and-pa about what to do with it.

There is a small hardware store--very innoccous looking--that has an extaordinarly sumptuous and luxurious 2nd-floor kitchen and bath showroom. It's the secret source for the highest end interior designers in the city, the one place that shows and stocks the very highest end kitchen and bath accessories that the big box stores won't touch. It's also the place that has the esoteric parts and tools to solve the real tough electrical and plumbing problems that professionals run into, again, items the big box stores won't touch.

But for sure, it's the globalization that began in the late 80s that is the real problem for the American economy.

I know a mid-sized electronic-device manufacturer in Nashville who has been trying as hard as possible to keep his line all-American. His problem is that it's harder and harder to find components built in America, and simply impossible to get a custom component (say, a circuit board of his own design) built in the US.

Yet, he hates the process of dealing with Chinese manufacturers. Unless a company is big enough to put their personnel in China, quality control is murder to maintain long distance.