Wal Mart Case Study

6292 words - 25 pages

AbstractWal-Mart is by far the largest retailer in the United States. It consistently puts competitors out of business, and has sales larger than the Gross National Product of most countries. However, on average, it pays its employees lower wages than most retailers and uses contractors who use sweatshop labor overseas to produce goods that have been labeled "Made in America." Wal-Mart is accused of increasing the need for social services in areas where its stores are leading employers, as many employees qualify for public assistance. Wal-Mart is also in the business of making moral decisions for its customers such as refusing to carry Previn, a "morning-after" pill, and censoring music and videos. This teaching case study aims to draw out discussion about these issues in undergraduate ethics and political economy classes. In particular, some questions we hope arise from this study include: What are the responsibilities of a corporation, especially one as large as Wal-Mart? Should a corporation be concerned with the effects it has on a society, ecosystem, or community? What are the rights of communities when it comes to allowing or not allowing businesses into their area? What are the policy implications? This case study aims to raise more questions than answers in these areas, in the hope that classes can use the study as a guide for lively discussion about the marketplace, social welfare, cultural homogenization, labor and other issues in the context of expanding global corporate influence in society.Wal-Mart or World-Mart?IntroductionWal-Mart is a company that most Americans are familiar with, a company with stores that offer everything a person could need at low prices. What began as a company based in a small Arkansas town has grown to be the largest employer in the United States. By 1998, Wal-Mart had the fourth highest annual sales revenue of any American company and had stores throughout four continents. It is estimated that within a few years, twenty cents of every retail dollar spent in the U.S. will be spent at this store. Yet, most people are probably not familiar with how big Wal-Mart truly is, how it became so big, nor how powerful it is.In order to minimize operating costs and maintain low prices, Wal-Mart pays relatively low wages and provides minimal benefits to its employees. Yet, Wal-Mart has taken some fairly drastic measures to ensure that their workforce is not able to form unions. Wal-Mart purchases many of its items, particularly clothing, from developing countries, including the U.S. Commonwealth of Saipan. This case study will consider the implications this policy has on laborers and development in those countries, as well as production and employment in the U.S.Despite the positive public image it portrays, Wal-Mart's size and growth have also allowed it to force other stores out of business, often causing a disintegration of communities and ultimately reducing consumer choices. One question this case study considers is...

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