This post was spurred by the comments of my many friends that hate Walmart. I've read their objections on Facebook and heard them talking about it at social gatherings, but most of their arguments don't make sense to me.
Walmart objections seem to fall into two categories. First, that Walmart will destroy something economically (a small business, city, county, country, etc.)
Second complaint, the horrible dress of Walmart shoppers. I'm not going to even attempt to tackle that one.
I have many thoughts about why I disagree with Walmart-haters, but I wanted to back up my thoughts with data of some sort. So I hit the books.
I looked at both sides of the issue (for and against) and read more studies, opinions, etc than you could ever count. If you want to read some of them yourself, to form your own opinion, I've listed a few of them below (not all of them, though. Too many to list here.)
Harvard Business School – The Real Wal-Mart
The Effect of Wal-Mart Stores on Businesses in Host Towns and Surrounding Towns in Iowa
Impact of the Wal-Mart Phenomenon on Rural Communities
Competing with the Discount Mass Merchandisers
The Economic Impact of Wal-Mart Supercenters on Existing Businesses in Mississippi
How do you deal with the entry of a new Wal-Mart?
Pros and cons of having Wal-Mart stores.
Wal-Mart colapes cites and towns.
Always low wages. Where would Jesus shop? Not Wal-Mart.
The Writing On The Wall – Blog
Some books you can read on the topic are:
The Bully of Bentonville: How the High Cost of Wal-Mart’s Everyday Low Prices is Hurting America by Anthony Bianco’s
The Wal-Mart Effect by Charles Fishman’s
QUICKLY, BEFORE I START, I WANT TO MAKE A POINT:
Life is not fair – And trying to make it fair by forcing people via government/laws (at the point of a gun) will only backfire in the long run
Stop the producers and stop the world –
LET’S BREAK THIS WALMART ECONOMIC THING INTO IT’S PARTS, SHALL WE?
OBJECTION #1: Walmart is killing small business.
My original thought when I heard that Walmart was killing small business was, "If small business owners don't know any business strategy beyond 'price' then they are business ignoramuses and they shouldn't be in business in the first place. If they aren't smart enough to compete with Walmart with an angle on service, or creative enough to find a new method of marketing themselves, then please get out of the hell out of the business world." Some of the most successful businesses I know have the highest price, NOT the lowest. Can the small business owner not get past price?
NEXT THOUGHT: Small business has been under attack for over 100 years - way before Walmart was even in the picture. First by the expansion of the railroad which made mail order companies flourish. People no longer were forced to buy from their local shop keepers. They could order via catalog from companies far away- like Sears & Roebuck. (Oh my gosh, just like the internet is doing to small business right now. Who would have thought?) Should we have stopped the growth of the rail road in the name of small business?
Then an extensive road system began to be built along with better and faster cars which made people more mobile and gave them more options. Should we have halted the production of the automobile and an extensive road system in the name of small business?
Then up popped malls. The same argument was debated then, about malls, as is surfacing now with Walmart. Yet small business still continues to live on. Should we have stopped the growth of malls in the name of small business?
Big-box stores were another big objection of small business owners. This story just keeps going on and on.
NEXT THOUGHT: Walmart is NOT the first company to threaten small business. Sears expanded from its mail order roots and started opening stores - becoming the low price leader way back when - putting a strain on small business.
After Sears, JC Penny was the low-price leader.
Can't forget Woolworths.
Then a little later in time the Kmarts came along... now it is Walmart. Quite frankly, most Walmart haters (and other) have a very short view of history. They don't see that the "low-price leaders" can't sustain themselves for too long anyway. It 's a bad business model - long term. I predict that Walmart will follow the path of the Sears, Woolworths, and Kmarts of the world. The will either have to reinvent themselves like Sears, disappear like Woolworths, or dwindle in uncertainty like Kmart.
ARGUMENT #2: Walmart is killing small town America.
Most studies showed that the effects of Walmart on small towns were a wash. The positives balanced out the negatives. For example, in some towns, the grocery stores saw a decrease in business, but the furniture stores saw an increase.
The author of one study echoed my thoughts from earlier in this post. He said small town business needed to change their strategies from price to things such as service, specialization, and maximize advertising.
NEXT POINT: Of all the arguments I read about Walmart shutting down small town America, I could only find one real-world example. The closing of the RCA television plant in Circleville, Ohio. Walmart haters repeatedly gave this same example over and over but no others (that I could easily find, anyway). They seemed to believe that this one isolated incident was all the proof they needed.
ARGUMENT #3: Walmart is Paying Unfair Wages to Its Employees
FIRST POINT: It's not like Walmart has a gun pointed to the head of every employee that works for them.
It's a mutual agreement between Walmart and each employee. They work there by choice. Besides, I don't see any Walmart employees complaining. I know several people that work there who have no complaints.
NEXT POINT: Walmart is not the only company offering low wages. From everything I read, the average start wage there is $8.00 per hour. How do Walmart cashiers compare? Pretty close I think. Look at this post for a cashier at a restaurant chain in my local area.
Here is another example from a furniture store in my local area.
And yet another example from a local ski resort. Seems to me that the very people bad mouthing Walmart, in the name of small business, haven't looked at what small business pays its employees. Hypocritical, don't you think?
NEXT THOUGHT: There is this law called "Minimum Wage" and Walmart has to pay at least that amount. (Of course some people in the U.S. are paid on salary and made to work countless hours and therefore make way less than minimum wage, but that's a whole different argument.)
But back to my main argument, Walmart employees don't have to work at Walmart. They chose to work at Walmart. It is a mutual agreement between them.
ARGUMENT #4: Walmart is killing the U.S. economy.
If Walmart saves a consumer money, thus freeing up a certain percentage of their income that he/she can now spend in other parts of the economy, then how is that going to hurt our economy? Just a thought.
ARGUMENT # 5 The Child Labor Issue.
First off, I want to be very clear that I am against childhood labor. The point I want to make, though, is this. You can't blame Walmart for this. We, ourselves, have done this to the world.
. As a country, we in the U.S. have pushed ourselves right out of being competative for jobs and are propelling the child labor issue with labor unions...
And excessive taxes on businesses.
The cost of running a business in the U.S. is so expensive now that the only way to remain competitive is to find cheaper labor overseas. In my research for this post, I have found example, after example, after example of companies that did not want to participate in child labor, but were forced to because of the cost of business due to the reasons I mentioned above.
In closing. I am open to being wrong about this. Please post a comment if you see an angle on the Walmart issue I have missed. If you see holes in my argument. I welcome your rebuttal. As for now, I am still shopping at Walmart.