Skip to comments.The Price Is Right [Harvard business professor praises Wal-mart] (NYT Op-Ed)
Posted on 08/03/2005 12:54:00 PM PDT by summer
.... But to chalk up Wal-Mart's success simply to the exploitation of its work force, as many of the company's most ferocious critics do, is simply wrong, for two reasons.
First, Wal-Mart hasn't just sliced up the economic pie in a way that favors one group over another. Rather, it has made the total pie bigger....
Second, most of the value created by the company is actually pocketed by its customers in the form of lower prices. According to one recent academic study, when Wal-Mart enters a market, prices decrease by 8 percent in rural areas and 5 percent in urban areas.... And because Wal-Mart's presence forces the store's competitors to charge lower prices as well, this $16 billion figure understates the company's real impact by at least half.
These kinds of savings to customers far exceed the costs that Wal-Mart supposedly imposes on society...
... Is such pro-consumerism a good thing?
The answer depends on who these consumers are, and Wal-Mart's customers tend to be the Americans who need the most help. Our research shows that Wal-Mart operates two-and-a-half times as much selling space per inhabitant in the poorest third of states as in the richest third. And within that poorest third of states, 80 percent of Wal-Mart's square footage is in the 25 percent of ZIP codes with the greatest number of poor households. Without the much-maligned Wal-Mart, the rural poor, in particular, would pay several percentage points more for the food and other merchandise that after housing is their largest household expense.
So in thinking about Wal-Mart, let's keep in mind who's reaping the benefits of those "everyday low prices" - and, by extension, where the real conflict lies.
(Excerpt) Read more at nytimes.com ...
I shop at both Walmart and Target and appreciate the fact that both are in my area.
That says multitudes about the manufacuring base in your area.
The Pakistani and Central American made products you find in WalmMart are no different than the Pakistani and Central American made products you will findin Target, KMart, Sears, Penney's, etc..........the price just happens to be lower in WalMart..........but they are the same proudcts.
And it's not even Saturday :)!!!!!!!!!!!!!!!!!
I live in a rural/agriculture/fishing area, not in a manufacturing area.
Walmart pays far better than any of the other retailers in the area. You don't have to believe me, but I know this for a fact.........but as I said, that is in my area, your mileage may vary.
Dude, you really need to get a TV...
did you even read the article? The author is spot-on - prices are lowered to the consumer (remember there are many multiples of consumers as compared to employees), but also, choices are increased - I challenge anyone to prove that the net benefits to any of affected parties is negative. The people working at Wal-Mart are also part of the lower/middle class consumers that shop there.
Another observation: I just read somewhere that manufacturers are finding overseas employees to be less profitable and are bringing them back home, but are using more automation. That is also a major factor in our changing economy.
There is not much difference in big box stores and mom/pop stores. They all carry things from all over the world...and some of it is cheaper at Walmart, and some of it is not. But it just seems to me that to blame changes in our economy on Walmart is a simplistic solution to a very complex situation.
Waiting for you to enlighten us.
I didn't make that charge. The author (and others) gushing over Wal-mart and how they are bringing prosperity to the consumer prompted my response. I am offering an opposing view - that it has a price. And that price is not so obvious. If you're willing to pay that price . .fine.
No worse than other retailers and better than most.
Thanks for the heads up. Can't wait for kellynla to put in his same old 2 cents about the "Chicoms". But I see we have a new one with the union talking points here, bipolar.
They all hate free choice. It perplexes me why they all think Walmart is the only company importing goods and not paying the same wages as other retailers. The union talking points fail to say who, other than the state, would be paying these employees if Walmart would just close up. It's hard to imagine that over one million people work for the company against their will.
The only real fact is that unions are dying and their last real hope is to unionize the retail industry and Walmart is the target, they need the dues and don't give a damn about the employees. The article did an excellent job of pointing out the benefits of the Walmart business plan to much of the country, the only loser is the union. Too bad.
It takes longer for it to soak in for some and there are only so many years in a lifetime, so . . .
It hasn't "soaked in" to you yet.
Wal-Mart is an American success story. Learn to live with it.
In other words, you truly don't know what you are talking about. Freedom of choice is a great thing, if you don't like the company-don't do business with them. But trashing them without knowledge just makes you look silly. It is amazing how you echo the union talking points though, almost word for word. Makes me wonder...
It is the same crap I see while lurking at DU.
Yes, it is the same leftist, union garbage. These fools think that their unions, which drove the jobs out of the northern states, will rescue them. What a laugh. Labor intensive jobs will always flow to the lower cost centers, but the union fools don't recognize that simple fact. And the left always hates success in private industry.
No more so than any other retailer.
Less so than most.