Walmart Case Study

In today’s growing market, Wal-Mart is the largest retailer in the world. Wal-Mart’s

low prices have become very attractive within this ever changing economy. Consumers

are able to purchase a vast array of products and groceries in the same location. Also,

get their automobile serviced. It is considered a “superstore”. Wal-Mart has a domestic

and global presence that extends as far as China, where most of their products are

manufactured.

In recent years, arguments have been made that Wal-Mart is good for the

consumers of America but it isn’t good for American suppliers and small businesses.

While the low prices attract millions of people, Wal-Mart hurts small businesses by

making them produce materials at a lesser amount than they can afford. American

Suppliers suffer because they can’t compete with the low labor cost and/or price for

producing products in China. As a result, American suppliers either close or downsize.

Wal-Mart has gained a pricing advantage by reversing the traditional auction

process. The traditional auction process allows manufacturers to control the bidding for

Wal-Mart Stores whereas now manufacturers that want to sell their product(s) at

Wal-Mart must decrease their sales price which forces them to lower wages.

Therefore, the ability for small businesses to compete fairly, generate revenue, increase

employment opportunities and pride of ownership within local communities is

eliminated.

Overall Wal-Mart's goal is to gain a competitive advantage by decreasing the costs

of their products. They have effectively and efficiently devised a strategy that will

generate an ongoing flow of revenue that may affect the progression of other

companies and employee retention. This strategy is not good for America.

In 2006, a study was conducted by the Center for Urban Research and Learning

(CURL) of Loyola University Chicago about the affects of retail stores in business

districts. It was proven that opening of a new Wal-Mart store on the North Side