OK, so you all can crucify me now...

Enough about your homework, Thornton Melon.

Already turned in, I just found the topic interesting and figured, knowing this groups dichotomy of characters, you all would too. Feel free to mute and ignore.

You missed a trick. A large nationwide supermarket opens in a new town and sells many things at below cost price, driving the surrounding smaller retailers out of business because they can't compete. They take the losses at the new store for a year or so, until the competition has gone out of business, then the prices go way up (and the wages go down*). Then they use their now massive profits to support the losses of another new store in another town. Rinse and repeat. Their *only* motivation is profit Profit PROFIT.

* Do you have this over in the USA? http://en.wikipedia.org/wiki/Zero-hour_contract

That's not a bad argument, STA, if Wal-Mart actually followed that local price pattern. In reality, they don't show any more interest in letting others back into markets than they do in letting them live in the first place.

@Draug -- I didn't find your post convincing. Almost nothing was supported; you didn't define what you meant by "fair," or exactly what actions of Wal-Mart were violating it; and Wal-Mart's median wage is well above minimum wage (and above poverty level for a family of three). It's also pretty absurd to suggest (especially without support) that the families of their workers are their "primary customers."

So, overall, I'd say it's a poorly supported, unfactual hatchet job. There are certainly things to criticize Wal-Mart for, but I don't see how you do yourself any favors by making things up.

As for the DC thing, the actions of the city council in that case were absurd, as even the extremely liberal mayor recognized. There is just no question that Wal-Mart's jobs are better than no jobs at all in a city with 18.7% poverty rate, especially since items would, indeed, be available cheaper with than without them.

"Is Wal-Mart's business practices good or fair?"

Sorry to be a grammar Nazi, and I presume you didn't set the question, but for starters the first sentence should read:

"Are Wal-Mart's business practices good or fair?"

"Practices" implies the plural so you should use "are" rather than "is". For "is" to be just about correct, the sentence would have to read:

"Is Wal-Mart's business practice good or fair?"



Moving on to your main post, a number of comments:


1. You do not define what you mean by "Wal-Mart's business practices". This implies that any part of Wal-Mart's overall business model, and any other aspect of their activities, is open for discussion here.


2. Given (1) above, the statement: "one thing is for certain, it is good for the consumer in the here and now" requires further support. On what basis is this "certain"? It could be argued that elements of Wal-Mart's business practices are bad for consumers. For example, Wal-Mart has been criticised for stealthily promoting unhealthy processed foods as "healthy". You cannot simply make the claim that Wal-Mart is "good for the consumer" without explaining why you conclude that this is the case.


3. "...reducing the ROI definitely is being responsible to the shareholders."

Surely shareholders would want the return on their investment to *increase* ??


4. "...often times these communities look forward to the jobs Wal-Mart brings only to discover they can’t live on the wages offered and their business model, as a result, is not sustainable."

Do you have any real evidence that the business model is not sustainable on those terms? Can you provide an example of a case where a new Wal-Mart had opened in a town, and had the effect of lowering incomes in that town to a level where people in the town could not afford to shop, and the Wal-Mart store resultingly closed down?

Questions: If wal-mart is successful does that encourage other businesses to copy it's success and investors to offer an alternative? Or is a monopoly forming?

How can wal-mart employees be stopped from forming a Union, particularily with the internet to organise, can they not simply communicate privately and present a collective bargaining option to their management (this is less of a legal question and more of a practical one)? Especially considering the power of bulk purchase seems to be a big part of wal-mart strategy, surely the collective bargaining on the part of their employees would follow in this ethos...

Do consumers vote with their feet?

Draug, with lines like 'it isn’t responsible to the community' - are you used to being called a socialist?

A living wage is an interesting concept. In the UK there was certainly never any tradition of the smaller stores that supermarkets replaced being any more generous with wages. Nor where they generally better quality. The current UK system of a handful of large supermarkets competing with each other for mass produced goods whilst smaller stores cater to high quality works rather well for the consumer, and no worse for the worker. Supermarkets make for a poor career choice, but are excellent for students, those who need a stepping stone, and those who want part time employment

Remember folks, this was just a post on a forum. I could have copy/pasted the rest of the details and the question as I posted it was a summarization of a longer post by the professor so the grammar error and lack of detail on business practices is mine.

to cover what I saw at a glance:

Median Wage includes management so of course it is above minimum wage. Duh! Did you go to the article about them closing down a planned development in DC after DC decided to enact a living wage requirement? That wasn't made up despite your assertions to the contrary.

As far as my supposition that Wal-Marts customers are their employees families, I made that in reference specifically to *a small town*. In Smallville, Wal-Mart would be the primary store and one of the primary employers especially for teens. That isn't a fabrication but simple logic.

And yes, I meant reduce costs and increase ROI by reducing I vestment.

And there are instances of Wal-Marts closing because of lack of business in small towns I've seen two close and a third cut in half in small suburbs of Cincinnati.

@Draugnar - I think your post covers all the bases, I would echo others comments about about setting out first what business practices you are talking about. I'd also consider what "fair" means in the objective sense. In the UK we have a host of legilation that stores have to adher to including, for example, an unfair contract terms act. If our stores comply with the act in the employment and supplier contracts then in an objective sense they are being "fair", whereas if the are frequently prosecuted for infringing the act or other statutes then one could consider them to be acting unfairly. It is. of course, much harder to be objective when considering if they are "good".

I personally wouldn't say things like "Only time (and history) can tell ..." I realy doubt that in time the historians will agree about anything any more than we do today.

Remember, this was just a forum posting, like a classroom discussion. This wasn't a formal paper. But I appreciate all the comments, both compliments and criticisms, as they are bound to make me a better poster and help witht he rwriting as well. So thank you all.

If there is interest, I may post the other discussion topic for this week and my response. It was about Social Entrepreneurism and I *know* there are some opinions about the subject here as well.

Hi Draug,

I'll briefly respond to your points that were addressed to me.

"Median Wage includes management so of course it is above minimum wage. Duh!"

Wrong. Yes, it includes management in the computation, but we're talking median, not mean. The median Wal-Mart wage -- that is, the wage that is made or exceeded by (just) over half of their employees -- is WELL over minimum wage. In other words, that's the wage that 1.1 million of their 2.2 million employees are making (or exceeding).

That's hardly inconsequential to evaluating claims about how "their employees" can hardly afford anything because of "their" $7.25 / hour wage, nor is it inconsequential to a city that is evaluating what the impact of a new Wal-Mart would be on their citizens via jobs.

"Did you go to the article about them closing down a planned development in DC after DC decided to enact a living wage requirement? That wasn't made up despite your assertions to the contrary."

I didn't assert anything of the kind. In fact, I even addressed the article in my closing paragraph. Of course Wal-Mart pulled out in the face of the ridiculous and offensive living wage requirement. That's why it was such a stupid thing of the city council to do: Wal-Mart is not even supposed to be in the charity business, but they were taking actions that would clearly have helped thousands of DC residents, and they were stopped from doing it.

"As far as my supposition that Wal-Marts customers are their employees families, I made that in reference specifically to *a small town*. In Smallville, Wal-Mart would be the primary store and one of the primary employers especially for teens. That isn't a fabrication but simple logic."

It doesn't matter whether you're talking about a small town or not. Wal-Mart only opens in a small town if there are enough other small towns around for them to have a lot of business (or if they think there are, at least).

Want to talk about simple logic? If Wal-Mart's primary customers are their employees, then they're going to go broke. Somebody pulling in $22,000 a year (the median Wal-Mart wage) is probably going to have to spend a good $10,000 on housing, taxes, transportation, and other things they can't get at Wal-Mart. That leaves them $12,000 to spend at Wal-Mart, which means Wal-Mart is getting (at most) 55 cents for every dollar they give to employees. If employees are their primary customers, just how long do you figure that business model will last (small town or not)?

Wal-Mart, not being altogether ignorant of arithmetic, is not going to go into a small town unless they have reason to believe that there are a lot of people in the area (including other nearby towns and the countryside) who will come buy at their store, well beyond just the people they employ.

Put another way: Wal-Mart averages about 245 employees per store. They average about $52 million of revenue per store, per year. To make that up off of their 245 employees, they would need each employee to spend about $212,000 a year in the store. Yeah.... probably not happening.

(Yes, these are just averages -- but Wal-Mart's not going to be interested in opening a store that just performs at 1/20th of average).

Hey Draug, a portion of my work actually involves dealing with people who run social enterprises, so please do post the other topic and your response, I'd be interested.

$22,000 a year is the mediam Wal-MArt salary... That means less than $11.hr is the mdeian Wal-Mart pay. So half of their employees make less than $11/hr. Dude, that isn't even 150% of the poverty level for *two* people.

http://aspe.hhs.gov/poverty/13poverty.cfm

15K is the poverty level for two people in a house hold. The average single parent working at Wal-Mart would actually be eligible for several welfare subsidies. What does this tell you about Wal-Mart?

"Put another way: Wal-Mart averages about 245 employees per store. They average about $52 million of revenue per store, per year. To make that up off of their 245 employees, they would need each employee to spend about $212,000 a year in the store. Yeah.... probably not happening."

Seems you forgot where I said "and their families". And you'll not I didn't say "and their *immediate* families". I also said "primary customers" not "*only* customers" so it seems your math is facetious at best. Try again. Do not pass go. Do not collect $11/hr.

"Seems you forgot where I said "and their families". And you'll not I didn't say "and their *immediate* families". I also said "primary customers" not "*only* customers" so it seems your math is facetious at best. Try again. Do not pass go. Do not collect $11/hr. "

I can't even believe you're arguing this ridiculous point. "and their families" meant their extended families? So what, is your next claim going to be that small towns are all incestuous, so everybody is related to a Wal-Mart worker, so you win?

Nobody would interpret your words to mean extended families, and extended families would not support your point. You wrote,

"While profit is the reason for going into business and reducing the ROI definitely is being responsible to the shareholders, it isn’t responsible to the community they move into because often times these communities look forward to the jobs Wal-Mart brings only to discover they can’t live on the wages offered and their business model, as a result, is not sustainable. Their employees and their employees’ families, in many small towns, are their primary customers. By undercutting wages and maximizing profit, Wal-Mart is profiting further off its employees who will eventually be unable to buy that 36” flat panel TV set even for the everyday low price because it just isn’t in their 7.25 an hour budget."

This point is only even vaguely coherent if "and their employees' families" refers to their employees' dependents. So, if you really meant extended families, then I'll just say that this is a horrible point, since you have no idea what wages their extended families may or may not be making.

As for the "primary customers," point, I'll remind you that Wal-Mart has to make about *$220,000* per employee. Their employees and dependents aren't accounting for more than about a tenth. There is no sense of "primary customers" that could mean this.

"Dude, that isn't even 150% of the poverty level for *two* people."

Sure. And explain to me how 140% of poverty is worse than under poverty?

"15K is the poverty level for two people in a house hold. The average single parent working at Wal-Mart would actually be eligible for several welfare subsidies. What does this tell you about Wal-Mart? "

That they're giving jobs to people who would be desperately badly off if they didn't have them.

"So what, is your next claim going to be that small towns are all incestuous, so everybody is related to a Wal-Mart worker, so you win?"

Go to Henderson KY. Thorw a stone at any person you see downtown. Odds are I am related to one of them. YEs, small towns have a lot of inter-relationships. And it sin't incest. Steps siblings and in-laws are family to folk in small towns and yes, that is *Exactly* what I meant. Any *normal* person would assume family meant more than just the people living in the same four walls in a small town. Have you ever *been* in small town America? I somehow doubt it.

"I'll remind you that Wal-Mart has to make about *$220,000* per employee"

They don't *have* to make that per employee. They *choose* to make that. I'm all for business. Hell, I love making money. But Wal-Mart makes it off the backs of people who have no way of fighting back. Desperate people do desperate things to survive, including working at Wal-Mart.

Oh, and if you knew anything about small towns in America, you would know that family takes care of its own. And yes I mean *extended* family. Grandparents, parents, siblings, aunts and uncles, cousins. In small towns across America, they pitch in and help each other out. So when one is hurting becaus ethey are underpaid or being abused by their employer, the whole *extended* family gets hurt.

Go visit a coal mining town. Listen to Tennessee Ernie Ford's "16 Tons". You will see what I am talking about. You clearly have lived all your life in privilege and never been to the poor and starving towns of the midwest or the mountains. Lucky for you. While I have been lucky that my dad made his way out of those towns, I still went back to visit them on a regular basis and saw what places like Wal-Mart do when they come into town with their big promises and then fail to live up to them. They get what they can from the town and move on, leaving it worse off than if they had never come to begin with.

When you witness it first hand, perhaps you will see that there is such a thing as being a socially responsible company and that not being one is being evil.

Sorry, Draug, it's all too apparent what you meant in your initial paper, and now you're just committing typical Drauglike backpedaling to pretend you meant something else.

As for my background: not that it's relevant, but yes, I and my family are from a very, very small and isolated town. (It's 60 miles from the nearest Wal-Mart, and yes, people go there regularly). Yes, tons of people are related. I was just mocking your point because it was so obviously unrelated to your initial claim. Certainly families take care of each other, but that doesn't mean they're not better off with than without the Wal-Mart jobs. (My old hometown would not know what miracle had happened to it if it ever got its own Wal-Mart).

Let's look at your quote one more time:

"Their employees and their employees’ families, in many small towns, are their primary customers. By undercutting wages and maximizing profit, Wal-Mart is profiting further off its employees who will eventually be unable to buy that 36” flat panel TV set even for the everyday low price because it just isn’t in their 7.25 an hour budget."

A few points:

(a) If one's extended family, which is helping out but is not working at Wal-Mart, is shopping at Wal-Mart, then that's actually *helping,* because they'll have more money left over, and be able to help you more cheaply.

In particular, if the (absurd) claim were really true that the employees' families were the "primary customers," then there would have to be more than 10 family units spending $10,000 a year each at Wal-Mart for every one that was working there. This would end up an *enormous* financial benefit to the extended family.

(b) Once again, the median worker is *not* making $7.25 an hour, but almost 50% more. That remains a straight-up slander.

(c) But really, you give the lie to your novel claim that you were talking about extended families by the phrase, "their 7.25 an hour budget." *Clearly* you're talking about the employees and their immediate families, themselves -- not the extendeed families (since we would know nothing about their budget, and since, if there is a large influx of money for TVs from the uncles, then the budget would in any case be more than $7.25 an hour).

(d) It remains possible that you *thought* you were referring to extended families. In that case, this paragraph was very poorly written, because that is not what one would conclude.

So what really occurs for these extended families we're now speaking of? Wal-Mart comes into town, provides jobs for some of the family members who otherwise wouldn't have jobs, and provides much cheaper goods for the entire family (and a lot of other people too).

"They don't *have* to make that per employee."

Right, but for statistical purposes, we can assume they're not going to open a store that makes *far, far* less than that, and that is enough to explode your "family" theory.

"But Wal-Mart makes it off the backs of people who have no way of fighting back. Desperate people do desperate things to survive, including working at Wal-Mart. "

Or in other words, they're better off than they would be if Wal-Mart weren't there.

but have you DDoS'd her forum yet

inquiring minds need to know man

You are posting too frequently, please slow down.
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@semck

Pleasse keep the quotes in context. The point in "c)" wasn't even made in refernece ot family, but to the employee themselves and *after* the original post. So you fail on your frame of reference.

I did intend extended family the entire time. You may not have read it that way and that is my fault for not being clear, but it was the *intent* all along. Call me a liar if it makes you feel like a big shot. But it doesn't make me one. You know the old saying, sticks and stones...

"Or in other words, they're better off than they would be if Wal-Mart weren't there."

So a hooker whose pimp beats her every night and takes 90% of what she brought in is better off than if she weren't a hooker? I don't think so.

"So a hooker whose pimp beats her every night and takes 90% of what she brought in is better off than if she weren't a hooker? I don't think so. "

I'm not aware that most pimps give back an unusually large amount of merchandise for the 90% that they take; nor am I aware that Wal-Mart beats its employees. Keep the libel coming, though.

"I did intend extended family the entire time."

If you say so. I've shown it's an absurd claim either way, and would be irrelevant even if true.

what is the most one-sided webdiplomacy debate

semck is a debate nuclear missile

@Draug

Your opening paragraph is vague and repetitive, making it very weak.

What "business practice" are you talking about? Every single business practice? Or is the reader left to guess which ones you picked to consider? Furthermore, if you look closely, 2 of your 3 sentences say essentially the same thing; it is a waste of space. Finally, your first sentence is an odd run-on.

I don't understand what your second paragraph has to do with your thesis…

I find your 3rd paragraph unconvincing. Why are people working at Walmart? Because it's better than what they were doing before, no? Why then, is Walmart responsible to go even further beyond the norm of employers, if their jobs are already preferable?

Assuming this assignment was worth 5 , I'd give you a 3, since I like to be nice at the beginning of the semester.

Actually, Draug's pretty right on with his initial comments, though there's a line of reasoning that I think you could have used that would have made your point more strongly. With each Wal-Mart store you can look at how the money flows. The money flowing out of the community is obvious, that's just sales at the store. The money flowing in is employee wages, construction work, maintenance work etc. Therefore, for any given store, it is easy to see whether it's a net gain or loss for the community that it's in. In Wal-mart's case, almost all stores drain huge amounts of money out of the community, and thus they will inevitably make the community poorer in the long-run.

so do the goods that Wal-Mart sells get counted in this assessment of WM's net impact on community wealth

Given that the argument is about the flow of money, I think you might just be able to work that one out for yourself.

If it's not counting goods then it's a pretty poor measurement of whether a community is "poorer" or "richer"/"wealthier." Every business makes consumers poorer if we're only looking at money.

Lol

Mendax cannot conceive that the evil American imperialist consumer can consider unnecessary materialistic 'goods' as wealth, true wealth is the inner one gained by reading about the glorious achievements of Stalin and bolshevism.

The business practices in question were actully part of the intro from the professor. I just didn't include all of it here. It wa smore ot get a discussion rolling was all. I find this community is great with many different view points and, so far, much better grammar and reasoning than some of my classmates. But then they are mostly freshman level and our typical participant here is at worst highschooler doing freshman work and many of you far far above that.