WalMart

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Wal-Mart

• Professor Chuck Craypo

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Overall Opinion on Wal-Mart
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Favorability of Companies
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Wal-Marts Impact on the Poor
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Wal-Marts Productivity Loop
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Consequences of Wal-Marts Productivity Loop

• Step 1 Reduce Costs
• Squeeze suppliers
• Extracts producer revenues
• Relocated manufacturing overseas
• Increase foreign debts
• Erodes Wages and Benefits
• Low wages in a low-wage sector
• Working off the clock
• Skimps on benefits, e.g., health care
• Fleeces communities and tax payers
• Increases social costs
• Erodes physical infrastructure
• Erodes human capital

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Consequences of Wal-Marts Productivity Loop

• Step 2 Reduce Retail Prices
• Improves consumer living standards
• Increases consumer purchasing power
• Displaces existing retailers
• Drives out small chains and independent producers
• Displaces existing suppliers
• Excludes local businesses from internal Wal-Mart
  supply systems
• Triggers retail price wars
• Pressures industry rivals to imitate its
  operative behavior
• Extends to national and global markets

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Consequences of Wal-Marts Productivity Loop

• Step 3 Increase Sales
• Increases efficiency of supply systems
• Higher sales volume means greater economies of
  scale
• Further erodes domestic manufacturing goods
• Higher market shares adversely impact
  non-Wal-Mart supply system
• Further loss of manufacturing
• Facilitates additional consumer debt