Is Wal-Mart Good for America?

Is Wal-Mart good for America?


Advantages
-Wal-Mart offers a wide range of consumer goods for the people of America.
-It offers these wide ranges of good with low prices.
-Wal-Mart is a huge retailer market where almost all of the basic needs of a person can be bought easily.
-Wal-Mart created thousands of new jobs and allowed millions of Americans to save money with the low-priced goods.
-It lowered export prices between the countries of US and China.
-Wal-Mart's single-minded focus on low costs with helping contain U.S. inflation.
-Wal-Mart's sales is at around $300 billion a year, are equal to 2.5% of U.S. gross domestic product.
-It creates competition in the US, if there’s no competition, there’s no business.
-Wal-Mart provides lower cost of goods therefore lowering the cost of living for millions of lower income Americans.
-Wal-Mart has improved American productivity both of its own, suppliers and competitors and those things help the American economy.
-It has brought significant retail outlets to many rural and small town regions of America, therefore creating development to that region.
-Wal-Mart has been a leader of the use of information technology and it has refined consumer oriented marketing and production through its extensive data on and knowledge of consumer behaviour.


Disadvantages
-Destroys small businesses in local areas.
-Unemployment rate in the US is increasing; therefore people won’t have jobs and won’t earn enough money to buy their necessities.
-Cutting costs, results in putting out businesses because of not agreeing to an increase in sale price, used in the raw materials needed in making the product. (ex: Rubbermaid)
-Low standard of living for employees in China.
-Poor treatment of employees.
-Wal-Mart has an opening price point strategy where low cost items are advertised.
-Chinese manufacturers are said to be dumping, where the Chinese are producing exports and selling them in the U.S. below the price in China, or below what it costs to manufacture and ship abroad.
-The United States is exporting raw materials to Third World countries and importing their manufactured products, which is a reversal of former economic relations.
-Wal-Mart paid its hourly associates an average of $9.64 per hour -- almost $10 less than the average hourly wage the California supermarket workers were receiving.
-Wal-Mart's detractors point to a trail of litigation over pinch-penny issues like unpaid overtime, and to a federal investigation into its use of poorly paid illegal immigrants as janitors
-A basic flaw in the United States-China trade relationship is that we can afford to buy Chinese products, but they cannot afford to buy ours.



Evaluation

-"Consumers get huge benefits from Wal-Mart as long as it has real competition," Mr. Reich said. "The worry is that it becomes so powerful that it can unfairly stifle competition." Despite the fact that consumers from America are able to get things they want for such a cheap price, the consequences are unimaginable for people struggling to make a living. Wal-Mart outsources jobs to poor countries where labour is cheap and supplies products below the margin price of some of the suppliers. Therefore forcing the companies to agree with a low cost sale price. Then Wal-Mart has an opening price point strategy where low cost items are advertised, where it all has got to do with the customer’s perception of the prices. People are losing their business to countries that produce mass production of products that some are just being dumped into the country. It all depends on the person’s knowledge about Wal-Mart. As for me, the right to run a business and the right and privilege to gain as much as for the sake of you business’s survival is vital in every situation, but the cost to do these kinds of acts, not only cause controversial issues for you business but you take people out of their businesses and you leave them unemployed and took their lifetime job away from them.

Source: http://www.pbs.org/wgbh/pages/frontline/shows/walmart/