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The Economic Impact Of Wal Mart On Americans

2205 words - 9 pages

In 1962 a small business owner from Kansas named Sam Walton was about to revolutionize the way people shop. Walton’s dream was to make the shopping experience a pleasant and affordable one for all. The primary focus was on customer relations and a positive employee environment. In 1992 Sam Walton passed away and soon after so did his ideal superstore. When Wal-Mart enters a new location it relies on bully techniques to weed out its smaller competition leaving consumers little to no choice but to shop as well as be employed at Wal-Mart. The majority of Wal-Mart employees opt-out of the health benefits package due to the high premium cost and large deductibles leaving them without coverage or seeking state aid. ("Store Wars: When Wal-Mart Comes to Town") Wal-Mart is the largest retailer in the world with over half of their employees averaging wages that are below the Federal poverty line for a family of four.
Wal-Mart has become a household name with many positive attributes but they have been riddled with a large amount of negatives. Their motto of “Always low prices, always” have created soaring profits at the expense of their employees. Most Americans loves the convenience and low prices offered by Wal-Mart. Do Americans know what it actually costs for Wal-Mart to keep prices so low? With thousands of lawsuits filed each year it is a wonder why Wal-Mart refuses to change its practices. It is fairly safe to say that Sam Walton would not approve of how his company has been completely changed from its original intent by such a large margin. Employees are no longer happy working at Wal-Mart and to make matters worse the employees can no longer afford to work there. The average Wal-Mart associate earns about $1000 less than the Federal poverty lines for a family of four. Being the low price leader means treating the employees like low class citizens. Wal-Mart in many categories is now approximately 20% or more of an entire product line says Charles Fishman.
Executives at Wal-Mart claim that if the Federal minimum wage is increased, the company would have no other recourse but to increase prices or close stores. This is just one of the bully techniques the Wal-Mart Corporation uses to get their way. Another technique the company uses is undercutting nearby businesses. Though market research and analysis is standard in the retail industry, Wal-Mart goes above and beyond to ensure destruction of smaller businesses. The problem with this is that even though when Wal-Mart moves into the neighborhood and creates jobs, it destroys jobs as well with each smaller retailer closing. Smaller business are unable to compete with Wal-Mart due to the fact that their purchasing power is far less than that of the Mega Corporation. Typically, Wal-Mart dictates how much a vendor can charge for products leaving little to no wiggle room in negotiation power for the smaller companies. Smaller companies unable to negotiate prices down to a completing...

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