The Wal-Mart you don't know

| 5 Comments

Morten Halfdan posted about Walmart having pushed the cost savings too far.

Fast Company had a very interesting article about that a few months ago: The Wal-Mart You Don't Know.

The giant retailer's low prices often come with a high cost. Wal-Mart's relentless pressure can crush the companies it does business with and force them to send jobs overseas. Are we shopping our way straight to the unemployment line?

5 Comments

I fail to see how this is any different than an article that might have said:

"Wal-Mart's relentless pressure can crush the companies it does business with and force them to automate more processes with software. Are we shopping our way straight to the unemployment line?"

Now, if we want to bemoan jobs lost to software too, well that's all fine and good. But I like being a sysadmin, and my job would not be possible if it weren't for all those secretaries and typing pools displaced by software lo these many years ago.

Trade is a technology.

Hi Sean,

It's really not just about automation. I'd recommend you read the article instead of just the "teaser".


- ask

I'm not sure if I'd agree (and I actually had read the articlbefore posting my comment).

The meat of the article was about the increasingly slim margins that Wal-Mart permits manufacturers of various sorts, and how this in turn forces offshoring of manufacturing, or imports of foreign goods. That domestic appetite for low prices has produced a channel for foreign goods at the expense of American jobs.

All I meant to say was that this sounds a lot like the early 80's talk about how computers were replacing everyone's jobs, and how robots were going to kick all the manufacturers out of business, etc etc. The article talks up offshoring and similar practices like they are somehow different than automation. But really, they're not. It's just another means of producing goods at a lower cost.

Which is fine, but this is the same magazine that trumpeted (by and large) the world-changing benevolence of technological change in business.

Just seems a bit confused to welcome one job-destroying innovation, while casting another in a negative (and somewhat xenophobic) light.

But that's just me.

I understand Sean??s view point but I have to disagree.
The article points out that manufacturers are having to send jobs overseas in order to keep up with Wal-marts pricing demand. Wal-mart is forcing manufacturers (as a force to reckon with) to lower the cost of their items while the cost of raw materials to make these goods are increasing, plus the manufacturers still need to be able to pay their employees minimum wage.

These companies have to choose to sell to Wal-mart which is the largest company in the world, or not sell to Wal-mart and miss out on selling to a company that does more business than "Target, Sears, Kmart, J.C. Penney, Safeway, and Kroger combined."

The greed gets the best of these manufacturers and they move thousands of jobs overseas thus leaving thousands of people jobless here in the states.

Note: The article talked about Carolina Mills, a 75-year-old North Carolina company that supplies thread, yarn, and textile finishing to apparel makers had begun to face imported clothing sold so cheaply to Wal-Mart that they could not compete even if they paid their workers nothing.

And the crazy twist is now the ex-employees that were laid off due to out sourcing jobs to Asia have to buy things a Wal-mart (which may have caused the lay off)because they can't afford to shop anywhere else. Thus feeding the beast.

Some of these countries overseas have worker who will work for almost nothing. In the U.S. we can not compete with them, thus putting pressure on manufactures to manufacture overseas.

Sean (above) compared the article to "the early 80's talk about how computers were replacing everyone's jobs, and how robots were going to kick all the manufacturers out of business, etc etc."

There is a huge difference though. We failed to realize in the 80??s that computers and robots have people who operate, maintain and repair them, thus producing jobs, but when jobs go overseas no jobs are created to replace them, thus producing a high unemployment rate and then a bad economy. (I??m not a Bush supporter but the bad economy is mostly due to bad economic practices by corporate America).

"The greed gets the best of these manufacturers and they move thousands of jobs overseas thus leaving thousands of people jobless here in the states."

...because it's cheaper to do business in some other countries than in America.

Wal*Mart is trying to cut costs. There is nothing wrong with what Wal*Mart does. Wal*Mart is doing what a good company needs to do. Period.

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This page contains a single entry by Ask Bjørn Hansen published on March 16, 2004 2:53 PM.

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