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[greenyes] WAL-MART AND THE COST OF LOW PRICES



Excerpted from a cover story about Wal-Mart by Charles Fishman in the
December 2003 Fast Company magazine (forwarded by David Allaway):


WAL-MART AND THE COST OF LOW PRICES
Wal-Mart is not just the world's largest retailer. It's the world's largest
company - bigger than ExxonMobil, General Motors, and General Electric.
Wal-Mart sold $244.5 billion worth of goods last year. It does more
business than Target, Sears, Kmart, J.C. Penney, Safeway, and Kroger
combined. "Clearly," says Edward Fox, head of Southern Methodist
University's J.C. Penney Center for Retailing Excellence, "Wal-Mart is more
powerful than any retailer has ever been." It is, in fact, so big and so
furtively powerful as to have become an entirely different order of
corporate being.


Wal-Mart wields its power for just one purpose: to bring the lowest
possible prices to its customers. At Wal-Mart, that goal is never reached.
The retailer has a clear policy for suppliers: On basic products that don't
change, the price Wal-Mart will pay, and will charge shoppers, must drop
year after year. But what almost no one outside the world of Wal-Mart and
its 21,000 suppliers knows is the high cost of those low prices. Wal-Mart
has the power to squeeze profit-killing concessions from vendors. To
survive in the face of its pricing demands, makers of everything from bras
to bicycles to blue jeans have had to lay off employees and close U.S.
plants in favor of outsourcing products from overseas.


Wal-Mart has lulled shoppers into ignoring the difference between the price
of something and the cost. Its unending focus on price underscores
something that Americans are only starting to realize about globalization:
Ever-cheaper prices have consequences. Says Steve Dobbins, president of
North Carolina-based thread maker Carolina Mills: "We want clean air, clear
water, good living conditions, the best health care in the world - yet we
aren't willing to pay for anything manufactured under those restrictions."

______________________________
Karen Hales
Recycling/Solid Waste Specialist
TOWN of CARY

919-462-3873 voice
919-469-4304 fax
karen.hales@no.address
http://www.townofcary.org

"Make everyday America Recycles Day!"





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