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A Desperate Wal-Mart Demands Suppliers Pass Along Yuan Devaluation Savings
At Wal-Mart corporate, the idea of “everyday low costs” is something of a religion and it’s the cornerstone of the retail behemoth’s business model.
Unfortunately for employees and suppliers alike, maintaining “the low cost leader” title isn’t consistent with high wages or leniency vis-a-vis the supply chain. That explains why, after committing to spend some $1 billion to raise the wages of its lowest-paid employees, the company moved immediately to squeeze more cost savings from suppliers.
Put simply, when passing rising labor costs on to consumers isn’t an option, it’s the supply chain that suffers and now, in a frantic attempt to extract every last penny of savings in order to offset the cost of paying hundreds of thousands of workers $9/hour versus $8, Wal-Mart is effectively demanding price cuts from anyone with a connection to China in the wake of Beijing’s move to devalue the yuan. Here’s Reuters:
Wal-Mart Stores Inc is seeking price cuts from suppliers that produce goods in China, saying the retailer should share in the savings generated by China's devaluation of the yuan, people with knowledge of the matter said.
Wal-Mart managers in recent weeks have contacted more than 10,000 suppliers in various countries, all of which have manufacturing facilities in China, seeking cost cuts of 2 percent to 6 percent on mainly general merchandise including home furnishings, apparel, health and beauty products, appliances, electronics and toys, according to a consultant who advised Wal-Mart on the move and spoke on condition of anonymity to protect his relationship with the retailer.
The company is telling suppliers that they should pass on the savings arising from the yuan devaluation so Wal-Mart can achieve EDLC, or "everyday low cost," its term for the tight cost controls needed to keep prices low for consumers, according to executives at two vendors of durable goods, who also requested anonymity. Both were asked for cuts in the lower half of the 2 percent to 6 percent range. Both said they planned to negotiate a reduction in the proposed cuts.
This is at least the third push Wal-Mart has made this year to force suppliers to lower their costs. The first attempt came in late March when the company told suppliers to reduce marketing expenditures. Then, earlier this month, Bloomberg reported that Wal-Mart had begun adjusting payment schedules and charging storage fees. Here's Reuters again:
Wal-Mart's latest overture to suppliers comes as it seeks to push through broader changes designed to lower its costs through changes to vendor agreements. In June, Wal-Mart began asking all suppliers to pay fees to store inventory in Wal-Mart warehouses and in some cases has sought to extend the time Wal-Mart takes to pay its vendors.
Wal-Mart has been struggling to shore up its profit margins, which have been weighed down by a $1 billion investment announced earlier this year to increase wages for half a million store-level workers and other cost pressures. The company's stock is down 26 percent so far this year.
Spokeswoman Deisha Barnett said the new vendor agreements are aimed at making its terms more consistent across suppliers, and were part of its efforts to keep prices low at the store.
"It's change at the end of the day and that's not always easy, but we think what is best for our business and ultimately best for our customers," Barnett said.
Maybe so, but it's certainly not what's best for the supply chain and make no mistake, if Wal-Mart continues to apply pressure, suppliers will eventually be forced to cut jobs (just as we predicted earlier this year) because as Leon Nicholas, a senior vice president at Kantar Retail, which advises dozens of Wal-Mart suppliers told Bloomberg a few weeks ago, "you can push and push, but at the end of the day you know where the power lies."
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If you like your "Hi may name is Bob" you can keep your 'Hi my name is Bob" sticky tag on your way out the door.
Fuck!
We'll be paying more for our plastic pumpkins!
We are all entitled to affordable plastic pumpkins.
What will we do?
Don't shop at Wal-Mart.
Don't send your capital to Wal-Mart, Wall Street , and The Great Wall.
Keep your capital close to home, where it has a chance to come back to you.
Buy local.
Grow your own pumpkins, teach your kid how to safely use a knife, make your own jack-o-lantern. Don't fucking import it from the other side of the world.
Boris is service for Walmart translation of demands to Chinese supplier:
Yuan sei ling yu jan ku in za meiguo, yu masu mei king chi pa jan ku an gi bing bei ta pu rai sing.
So ....................... my Al Sharpton Action Figure Doll w/ Purple Escalade set will cost moar?
Dats rayciss!
I have two friends with modest size businesses that sell their products through Wal*Mart, as well as other channels. One has a car-care products company, and the other makes bicycle stuff. Both of these companies have their stuff manufactured in China.
In the past they had to sell through Wal*Mart, even though they hated doing so, because most of their sales occurred through the Wal*Mart channel, but that is all changing. BTW, they also hate manufacturing their products in China, who steals every new design, and inventory too, but the savings in manufacturing cost was too much to ignore.
With the rise of internet-based sales, the percentage of sales stemming from Wal*Mart is dropping fast, moving mostly to Amazon.
Amazon, and internet based selling in general, is slowly eating away at Wal*Mart. Yes, I know that there are still a significant number of poor people with limited internet access who shop at Wal*Mart, but, as a percentage of the population, that number is shrinking FAST!
And a large segment of the population still shop at Wal*Mart for plastic crap at Christmas time, but more people are skipping the physical stores, crowds, parking, etc., and just shopping on-line
This new dynamic will is giving the suppliers a LITTLE bit more of an edge with dealing with Wal*Mart.
p.s. Amazon is only a little bit less painful than Wal*Mart
Amazon is functioning at ZERO or very near zero profit. Hard to compete with a company that is willing to make no profit, but I do not see where that will go in the long term. But right now it is destroying many small businesses where people actually have to make money in order to eat.
I don't know about you, but I cannot work for free. Somehow Amazon can.
It's the Wal Mart model of squeezing everyone at the margins. WMT does have guaranteed clientèle (EBT) that Amazon doesn't.
That they make "zero" profit is a tax dodge. They are rapidly paying off debt, distrubution centers, etc.
Every business does what it can to lower it's profit so it is taxed less, but it's a dodge. Wall Street knows this.
Here's how my business didn;t make any profit:
I earned $100,000 dollars in profit BUT I drove 181,182 miles for business at 55 cents a mile as a deduction.
See, I didn't make any profit.
You must work for the government or be a school teacher.
"Zero Profit" on paper is (or should be) the goal of every business...PROFITS GET TAXED!
As long as the paychecks clear and the doors open the next day, who needs to earn a "profit"?
If there was "no profit" at Amazon, there would also be "no employees"...the exception to that is business burning through borrowed money...which is a possibility in today's enviroment.
of course they are "the exception" you mentioned. Amazon is capitalized via stock and has no NEED to earn a profit as long as investors keep supporting their "growth potential".
Cornhole or Cornflake or whatever you call yourself - I own and run my own successful business for over a decade that I built from nothing and that is how I make my living.
Why the snide remark about someone you don't even know? It makes you look small.
http://www.wikinvest.com/stock/Amazon.com_(AMZN)/Data/Debt_to_Equity
Double WMT's debt to equity.
https://www.stock-analysis-on.net/NASDAQ/Company/Amazoncom-Inc/Ratios/Lo...
So...doesn't WalMart hire bright people? Why didn't they make their contracts payable in Yuan/RMB? This was certainly an option for them? Why didn't they do it? OHHHHH, I know, because someone in the Treasury department at WalMart decided to a currency trader, and assume the RMB would APPRECIATE rather than depreciate. Isn't that the problem?
Maybe they need to look into hedging options.
Strong armed the wrong politician? Wal-mart deserves to be knocked back, by anyone. They have killed more private business in the USA than any other single company. Then the made in USA labels on top of made in China labels. Screw them. They deserve loss of market share and currency trade losses.
By outsourcing, they fixed their destiny years ago. Now, they are hitched to the fed. gov.'s FSA. Gov. contractor.
T-Mobile $150:http://www.t-mobile.com/cell-phones/kyocera-hydro-wave.html
Amazon $130:http://www.amazon.com/Kyocera-C6740N-T-mobile-Hydro-WAVE/dp/B012HOFHNG/r...
Walmart $100: http://www.walmart.com/ip/T-Mobile-Kyocera-Hydro-Wave-Prepaid-Smartphone...
Not even close.
That being said, Amazon is always my first stop.
Don't believe what you see. There are MANY manufacturers who make a version of their products just for Wal-Mart, even with the same model number. The guts of the Wal-Mart version will be made with cheaper, much easier to brake components.
wrong.
This is absolutely true - a less costly version goes to Walmart and Amazon, this is one way companies get past the price hurdle.
I heard it comes with a purple cape too. Oh, and rims.
If walmart did nothing, the price would stay the same, not increase, and the chinese suppliers would get more nominal yuan due to the devaluation.
So what's really going on is walmart trying to renegotiate a USD-denominated contract to in an attempt to capitalize on the change yuan exchange rate, fucking over the chinese suppliers for the value difference, completely ignoring the fact that their yuan now purchases less. e.g. typical walmart scummy practices.
Fuck Walmart
You know that guy that spills his icee on merchandise, breaks the plumbing in the bathroom at the store, buys a BBQ grill, uses it, then shoves it back in the box after a day at the beach complete with soggy coals, "rents tools" and then returns them becuase they are the wrong color, breaks a toothpick off in the front door lock, etc.
That's my brother.
+ 100
You sir, have succinctly nailed what is really going on in a most cogent way. Hat's off!
Sure, but don't forget that when the currency swings the other way, Wal-Mart rebates the changes back to down the supply chain.
Oh, wait. You mean they don't do that? They wouldn't just pocket that windfall, would they?
US deflation via chinese currency devaluation. Fed confused why 'full employment' doesn't heat up economy? With every agency playing games with their numbers no wonder nobody knows nuthin. Unemployed move to disability. Welfare moved to retired. Youth move back home. tuiton moved off gnp. bad debt moved off balance sheets. clunkers moved off the roads. I'm moved to tears. On paper everything looks great. Just need some more white out.
I have not set foot inside of a wal-mart for... 7 years! I do go to SAMses wholesale chinese junk shop on rare occasion, maybe 2 times a year.
Never has shopping been more full of bliss than the day i said i won't go back. I need to ask the wife the exact day, i don't remember, she will, soon to be 8 years i am sure.
I followed suit with Lowe's and Home Depot (when possible)
If a local or mom & pop sell it, I shop there. Sending dollars to other parts of the US and World hurts your community in ways you never think about.
It also helps concentrate wealth in a handful of executives' hands. This guarantees our 3rd world status. End the FED.
I get ill when I walk into Wal-Mart, Harbor Freight, or any dollar store. The chemical smell coming off almost every product in those stores makes me sick to stomach. I don't know how people stand it. I only go in if it's absolutely necessary, which isn't often, thank goodness.
Amazon has been taking share from them because they sell at loss. As long as their stock goes up perfectly fine to have negative margins and burn cash. It does hurt legitimate businesses that actually have to produce a profit to survive.
Then you have your $1 stores taking out the high margin low priced houseware stuffs.
If you are see photographic exposition of Walmart Woman consumer, you are also quick to look for other place to shopping. Boris is can only imagine much better is Amazon Woman!
http://www.peopleofwalmart.com/
2/3rds to 3/4ths of Walmart shoppers are on public assistance. Think about this -
The government prints up cash out of a thin air/US taxpayer mix, gives cash to the FSA, the FSA then spends the cash at Walmart who then purchases cheap shit from China.
The Walton family billionaires add to their fortunes on the backs of the US handout, which in turn feeds the Chinese manufacturing base.
I have shopped at Walmart once in the last ~3 years. I will not go into those stores unless I absolutely must.
Store of last resort. Even then, snap something off or break something when you're there to make it an "even trade".
Example: Buy label paper for office = put large scratch across demo TV screen or abbandon pot roast behind box in housewears.
(That's for all the family stores they put out of business by dropping their prces below cost to destroy small mom and pops, only to jack them up when the competition was gone).
Walmart is so popular and is grow in USSA, but is so low hold in esteem...?
90% of their employees are on public assistance also
If you happen to think the USA has a chance of survival, TRY to make it to the end of page 2 and get back with me. I found it funny until i realized what percentage of people shop there, with those pictured on that site.
I am suddenly wanting to jump from Titanic again, but i still don't know where to go.
It's not just Walmart. A friend that I used to work with in oilfield supply said the big oil companies are asking for discounts on deals already paid for. Overt shakedown.
H_O_G_S_H_I_T
So, prior to giving a $1 raise, Walmart never fucked over it's suppliers? Really need to come out from the rock more often...Walmart fucking it's suppliers is decades old..the only reason it stays in the news is because of short memory morons and fools that think they'll get rich selling to Walmart...Walmart will use you up and spit you out..NEXT!
One of Waltons kids is worth $36 Billion..COULD PERSONALLY WRITE THE CHECK TO COVER THE PAY INCREASES FOR AT LEAST THE NEXT 36 YEARS...JUST ONE FUCKEN WALTON...meanwhile, the taxpayers pick up the health costs (and more) of a big chunk of Walmarts "Workers" via Medicaid.
After the Vampire Squid of Wall Street, Walmart is a strong contender for second place in sucking blood and money from everyone it contacts.
Walmart came in second from last in survey of 68 US supermarkets
http://www.dailymail.co.uk/news/article-3025259/Walmart-ranks-second-wor...
Where I live, Walmart prices are much higher then Amazon online prices. Interstingly, even Walmart's online marketplace prices are generally higher then Amazon. It's no wonder Amazon has 60% of the internet market.
Plus, FleaBay is 50% misrepresented or fake stuff and Ali Baba is even worse [although I do see some nice men's 3-piece suits 100% geunine rayon for $4.65. For that price it has to be pretty spiffy, right?].
Never bought off of alibaba but ebay is very hit and miss. got some nice reloading dies bit other stuff has been sketchy
eBay is a dumping ground for shit that can't be sold any other way. I go to vintage automotive flea markets...they're really popular around here, 100's of people, plenty of sellers...time and again sellers tell me anything that doesn't sell here (which is usually the junk) will be auction off on ebay.
"When you can't sell it in person because, upon close examination, it's shit; sell it on ebay"....
It's PRIME sweetcorn time for the USA...corn on the cob from Walmart is Mexican shit corn...meanwhile, across the street, local farmers selling just picked corn?
My point; Walmarts produce is garbage.
Public TV, independent film, looking at mega farming...Question to the farm manager...
Q: Why are these Tomatoes so tasteless?
A: Corporat farmer with a smile on his face, "I get paid by the pound, not by the taste".
What's mine is mine and what's yours is mine too!
The strong dollar is hurting the whole world. When will US compensate all these countries or companies?
Greed is NOT good!
Lets thank the truckers now for their sacrifice to keep goods cheap at Walmart.
Your wages are about to disappear.
$30k a year coming to you soon.
Then oil prices will climb and kill you.
Just move your family into your mortgaged rig.
Sell your daughters at the terminals.
China loves Walmart.
The refugees will be waiting to buy your rigs at auction, with your tax dollars.
So let's see if I get this:
- China devalues its currency to boost exports by making them cheaper
- Walmart, one of the biggest China importers then demands price cuts from their suppliers
- Walmart keeps the same prices so that they can make bigger profits
Walmart net wins while the suppliers make less.
my thoughts exactly. they will NOT pass along the savings.
It's supposedly designed to offset the increased labor costs.
Because Wal-Mart and/or is top executives aren't profiting anything after the wage increases.
Nearly 3.5 billion net profit last quarter alone, they can afford to pay their suppliers more, their employees more, and still make a hefty profit.
Not if they purchase new inventory. Profits are used to start the cycle all over again. Less profit, less inventory if other expenses are rising, which they are with employee wages going up. Less inventory, fewer sales. Fewer sales, less profit. Even less profit means less inventory and fewer employees. Then the WalMart bashing will start all over again.
Last I checked asset acquisition was included as expenses and is applied against gross, not net. So unless all their shelves are empty, then their net profit plays little in maintaining said inventory.
Thats what ZIRP is for, buying new shit. You don't need money, just credit!
WalMart: creating US core disinflation since 1995.
At some point you push your suppliers into other ways of distribution and then they tell you to go fu...
Walmart squeezing its suppliers is nothing new. They were innovative in using IT to reduce costs, and probably were the first to treat suppliers like slaves, too. But at least Sam's kids don't have to ride around in pickup trucks, at least not until widespread rage forces them to abandon their limos. Maybe they can then ride around in stretched F-350s.
Top 10 Richest People in America
About Top 10 Richest People in AmericaThis 26th year of tracking global wealth was one to remember, with an all-time high . The 2012 Forbes Billionaires List breaks two records: total number of listees (1,226) and combined wealth ($4.6 trillion). This horde surpasses the gross domestic product of Germany, one of only six nations to have fewer billionaires this year.
Here’s the Top 10 Richest People United States as of 2012:
No. 1 Bill GatesNet Worth:$61 billion – As of March 2012
No. 2 Warren BuffettSource: Microsoft, self-made , Age: 56 , Citizenship: U.S.
Net Worth:$44 billion – As of March 2012
No. 3 Larry EllisonSource: Berkshire Hathaway, self-made , Age: 81 , Citizenship: U.S.
Net Worth:$36 billion – As of March 2011
No. 4 Christy Walton & familySource: Oracle, self-made , Age: 67 , Citizenship: U.S.
Net Worth:$25.3 billion – As of March 2012
No. 5 Charles Koch (tie)Source: Walmart, inherited , Age: 57 , Citizenship: U.S.
Net Worth:$25 billion – As of March 2012
No. 5 David Koch (tie)Source: Diversified, inherited and growing , Age: 76, Citizenship: United States
Net Worth:$25 billion – As of March 2012
No. 7 Sheldon AdelsonSource: Diversified, inherited and growing , Age: 71 , Citizenship: United States
Net Worth:$24.9 billion – As of March 2012
No. 8 Jim WaltonSource: Casinos, self-made , Age: 78 , Citizenship: United States
Net Worth: $23.7 billion – As of March 2012
No. 9 Alice WaltonSource: Walmart, inherited , Age: 64 , Citizenship: United States
Net Worth: $23.3 billion – As of March 2012
No. 10 R. Robson WaltonSource: Walmart, inherited , Age: 62 , Citizenship: United States
Net Worth: $23.1 billion – As of March 2012
Source: Walmart, inherited , Age: 68 , Citizenship: United States
Let me get this straight: The people who own Wal-Mart have a combined net worth of over $100Bn, but need to squeeze their suppliers and employees to keep the profit margins up. Do I have this right?
Just goes to show, for some people, the whole world is not enough. As Ghandi so pithily put it, "The world has enough for everyone's need, but not enough for everyone's greed." As long as we allow those in the thrall of greed and mammon to call the tune, we're all going to be dancing a very very ugly dance.
Oh it gets better.
They have a charitable foundation.
http://www.stltoday.com/business/local/trusts-allow-walton-family-to-saf...
http://www.dallasnews.com/business/retail/20130914-how-wal-marts-waltons...
Let me get this straight: The people who own Wal-Mart have a combined net worth of over $100Bn, but need to squeeze their suppliers and employees to keep the profit margins up. Do I have this right?
Just goes to show, for some people, the whole world is not enough. As Ghandi so pithily put it, "The world has enough for everyone's need, but not enough for everyone's greed." As long as we allow those in the thrall of greed and mammon to call the tune, we're all going to be dancing a very very ugly dance.
Look at that closely again. It states that their wealth was INHERITED. They don't care about their personal lives. They and they're great great grandchildren are set for eternity.
However, in their minds, it's the PRINCIPLE of the matter. They have believed in the BIG LIE of capitalism. And here is the BIG LIE. That capitalism is about freedom. BULLSHIT. Capitalism is about capturing market share so you can begin to dictate supply prices in order to maximize profits for yourself and shareholders and maximize cash flow for further growth and market share.
The end game of capitalism and the capitalist is to get to a point of monopoly or near monopoly (say a cartel) in order to control prices, stabalize expenses, maximize cash flow and ensure profit. THE END GAME OF CAPITALISM IS INEVITABLY FASCISM, CENTRALIZATION AND COLLECTIVISM. Ironic....no ?
Look at the WAL MART model. Look at BIG AG. Look at BIG PHARMA. Yes....yes....they have "free market" competition. But really...not AT SCALE they don't. EVERYONE, AND EVERY SUPPLIER AT SCALE IS PART OF A COLLECTIVE. ALL FLOWS OF SUPPLIES AND MATERIALS AND WORK IS CENTRALLY PLANNED AT HEADQUARTERS.
And when you get to that kind of SCALE, you become TOO BIG TO FAIL. That's when you get attention from not only BIG GOV....but BIG BANKING....ie....THE CENTRAL BANK. CENTRAL.....Bank. A COLLECTIVE of BANKS.
CENTRAL BANKING
CENTRAL GOVERNMENT
CENTRAL BUSINESS.....using a COLLECTIVE of GLOBAL SUPPLIERS......a COLLECTIVE of WORKERS.
WORLD GOVERNMENT......COLLECTIVE and CENTRLIZED CAPITALISM..........FASCSIM.....pure and simple.
"The World is a Busiess.....Mr. Beale." - Network 1976
The only difference between Marxism and Captialism is who gets the cut. The main similarity of Marxism and Capitalism....in the end....is, we the workers will ultimately NOT get the cut that the elites in both systems get. And also in the end.....both systems become....CENTRALIZED AND COLLECTIVE.
Embrace the dream of capitalism!
Work hard, bust your ass so you can get ahead, or at least tread water as inflation takes your earnings, and watch your boss raise even more trust fund kids!
Hmm, but in a true free-market capitalism, Walmart and every other large corporation would not have been able to lobby as they did.
That is actually where the 'end-game' lies, and its already here. Basically, control the legal code of a country (especially tax code), and you can prevent EVERYTHING. Its Warren Buffet's greatest 'strategy' that he undoubtedly picked up from partying with senators with his daddy.
Controlling the markets in a global international market is nigh possible. But controlling A MARKET in A COUNTRY by having the goverment under your thumb? Thats the ultimate power. Especially if that country is made up of the largest by wealth/debt consumer base in the world.
Do you really think, in 20 years, that Walmart will be the biggest player? Not a chance. It will be a mega-corp based in Hong Kong or India. The only reason why the US corp have been so strong is because we have kept everybody else weak. But, we will not be able to compete with the buying power of billions with 300 million, especially when those billions want the same standards of living we have taken for granted. And every year China has grown and started producing their own cars, planes, computers, phones, etc. Once the US consumer is completely and utterly tapped out, they will realize that they can begin to prey off of their own consumer base, and thus the tides will shift in their favor. Look up projected rankings. China and India ahead of US by 2050. Its happening already and its going to continue. Its the rise and fall of an empire.
P.S. I find the 'self-made' description of Warren Buffet hilarious. If i was born the son of a prominent senator, id be rich too.
"Hmm, but in a true free-market capitalism, Walmart and every other large corporation would not have been able to lobby as they did."
A "True Free Market" is a fantasy that can only exist on paper..STOP living in a fatansy theory world and start living in REALITY.
"Free Market Capitalism" WILL NEVER WORK because it can NEVER, ever, be implemented according to the perfect, detailed plan..give it up already.
Here in reality, we have to deal with psycopaths running the corporations and government, they have to be reigned in, REGULATED and ENFORCED, to hold them back, or we're all fucked.
Do you really think, in 20 years, that Walmart will be the biggest player? Not a chance. It will be a mega-corp based in Hong Kong or India.
Thanks for making my point
Controlling the markets in a global international market is nigh possible.
What ?? Did you not read the article? Wal Mart alone can control global markets......global markets for raw supplies, global markets of distribution chains, global markets of labor, global markets of debt....etc...etc.
You are correct they will not last into the future, at least not in this scale. It will be new MEGA-CORP as you said yourself in different geo-greographic regions, perhaps closer to origianal stores of raw supplies and labor. But that is happening now. Just look at alcohol sales....or food. THOUSANDS OF BRANDS OF BOOZE AND FOOD.....all owned, controlled and distributed by just a handfull of MEGA-CORPS. I think just 9 for food.....may 3-4 for booze.
More than that......WHEAT ALONE....is the basis of most food and booze production worldwide. And most wheat production is globally controlled by just a handfull of players....some of which control the food brands.
And every BANK in the world, and most DEFINITELY CENTRAL BANKS.....WHO COLLECTIVELY COORDINATE control the flow of money and debt to these handfull of GLOBAL PLAYERS.
Let me edit my quote from the movie Network......
"The world is a CARTEL....Mr. Beale.
I hope you don't believe these are the richest. Above are just low level baal worshippers.
The trillionaires are mobsters in suites who own banks.
They look human.
"At some point you push your suppliers into other ways of distribution and then they tell you to go fu..."
They already do, for example:
Direct From China
Anything the Walton clan sells can be bought cheaper directly, starve an oligarch today!
I'm a manufactuer of specialty pet products and I can tell you, less and less companies will do business with Wal Mart and their voids and outs on the shelf are proof of that. Our local Wal Mart had no business envelopes in the large box for 6 weeks!
Go ahead. See what brands of cheese are on Wal Marts shelf (Kraft & Fecal-Value) and then walk accross the street to the proper grocery store and see 18 different brands on the shelf. No one wants to do business with Wal Mart.
I would never sell my products to Wal Mart because of the head ache they are to deal with. Once they know you are 40% of their business, they threaten to cut ties and force you into bankruptcy, only to say, "Do you want to sell?"
One of their goons called me up and asked me, "Hey come sell with us. Don't you want to make more money?"
I said, "I have enough money, no thanks." I educated him on having this precious commodity called "time" "no debt" and "freedom".
They hate most off all folks that have nitch products like a brand of salsa, a cool tool, etc and they refuse to put their item in Wal Mart. Man that pisses them off.
With the advent of micro manufacturing (we don't make it, until you order it), no one does business with them, except the dumb desperate Chinese. We fired 90% of our emplyees in 2008 and totally automated (no, they weren't Americans). No, we don't make anything in China. It's all USA.
I hope to buy the land our local Wal Mart is on one day at auction for $1 and turn it into a kid's skateboard park.
Yes. Direct sales via Ebay. I've bought several things, mostly electronics(low postage), directly from Chinese suppliers for 50%-80% less than in US stores. Plus, no sales tax! If I get the wrong item, I just send a photo of it to Ebay and get a refund. They take the money back from the supplier. It's no wonder Trump is calling for import tariffs. Direct sales from China will kill a lot MORE jobs, Wal-Mart jobs.
The high cost of low prices!
tanstaafl
I can't tell if the ZH "$9 oh teh noes!" meme is sarcasm or if that's really being offered as a reason for WalMart to be going tits-up as opposed to say record non-employment and the generalized global meltdown and collapse of demand. Or something like that. I don't know, but seems to me like if CAT is being blown to shit, WalMart can blow up too. Right?
Agree. Who cares if the minimum wage goes up. Did employment or hours worked go up with it? Minimum wage hikes are a non-story. Anyone who has ever worked a retail job knows that the hourly wage they work for is only part of the compensation plan.
WalMart is a little more insulated against economic implosions than a company like 'CAT'. Think about it: CAT doesn't take EBT cards - WalMart does.
Wal Mart is INDEED vunerable because they are PHYSCAL in a way that even Amazon is not when it comes to space.
Amazon eventually will shed 50% of its workforce in the warehouses over the next 15-20 years due to A.I,, automation and robotics. Amazon and WalMart are nothing more than a WAREHOUSE. The FINAL warehouse of a system of warehouses. They are warehouses for the buyer. But Amazon does not NEED the buyer to come to their warehouse to satisfy the customer. WalMart does. Which means WalMart must buy land and materials and spend money on climate control and lighting to please the shopper and their employees.
Amazon does not. And it will need to less and less for their own workers once AI, automation and robots take over recieving, sorting, stacking, retrieval, and shipping prep of products from their warehouse.
In short.....warehouses should not be manned or occupied by HUMANS. And HUMANS are the biggest cost any company has. Eliminate or downsize (right size) that part of the equation,.....and Wal Mart has a BIG problem going forward.
The problem is, folks with EBT cards have no car and can't get to Wal Mart, so they go to General Feces around the corner.
That' right. Wal Mart is like Gulliver in Gulliver's Travels. They're lumbering giants that can barely afford to stand up in even the world at the scales needed......and are also being nibbled at and taken down by the Lilliputians at the margins.
Dollar General and Family Dollar save the consumer TWICE on the basic items simply from the saving in gas and time needed to drive to WalMart. In my case, that would be a TWENTY mile drive in any direction.
And if Dollar General can't satisfy....there's always AMAZON.
Thanks for mentioning EBT. If you were to suppose than a significant part of WalMart retail is EBT, then at the end of the day WalMart profit is supported by tax dollars. You could then go further and make a case that WalMart is functionally a part of the US welfare system, on the consumer end, as if the government were running a wholesale warehouse for consumer goods sourced in China the way they do for surplus cheese sourced in Wisconsin. Employment at WalMart could then be seen as a "work-fare" program and the wages paid (and benefits provided) would need to conform to government guidelines for such programs, and not for example to maximize the profits of WalMart C-level fucktards, being utterly irrelevant to the taxpayer public, who if they knew what the fucktards were being paid from the general fund would probably murder them on sight.
Just say'n.
Wal-Mart is a great way for the MBA class of our society to go and observe the black, white, and purple trash in their native habitat and feel better about themselves
I think that observation is dependent on the zip code.
Welcome to WalMart. Your bunk is in Aisle 6.
That' exactly what Chinese companies that are part of the WalMart system of supplers do.
Gazillionaire owners.......Desperate?
sumptins wrong with this math.
Walmart
You can check out anytime you want, but you will never leave.
I think it's a better slogan than the lowest price.
Say you?
Wal Mart: We'll buy your soul and sell it back to you at a discount.
+100
This almost sounds like those old anti-drug commercials:
"If I do more cocaine, I can work longer so I can earn more, so I can do more cocaine, so I can work longer, so I can earn more, so I can do more cocaine........"
Except now, "if I devalue my currency, I sell more to wal-mart, who will tell me to cut my costs further, and I devalue my currency so I can sell more to wal-mart, who will tell me to cut my costs more, so I can sell more to wal-Mart..."
Has Walmart installed the blast proof doors yet?
Black Friday is expected to be a hit this year again.
Employees may be working for DHS soon, without benefits.
The skies the limit at Walmart.
Walmart here has been having one-week SALES...never mind "everyday low prices"...which aren't particularly cheap anyway
Must be desperate. I love deflation and COMPETITION!
Maybe, they can borrow Kmart's Blue Light?
Their self-checkout lines are great places to buy $300 of T-Bone steaks with my EBT card,with no snotty cashier,or outraged cash customer,viewing the transaction..
Don't forget the hog fat to cook 'm in!
"Their self-checkout lines are great places to buy $300 of T-Bone steaks with my EBT card,with no snotty cashier,or outraged cash customer,viewing the transaction.."
I know a lot of poor people. I don't know of a single one that's tasted a steak in years. You are cordially invited to go fertilize yourself with a rusty machete.
False. It's not steak but I know a guy who buys pickeled pigs feet and other such delicacies using his EBT card. Shouldn't he be eating oatmeal, rice, basics like that instead?
Someone down voted an observation of fact? My guess is he gets EBT living off other peoples hard earned money.
I couldn't stand being poor for years. How do they stand it?? Medical issues?
"Yeah, do I get to call you back when this goes the other way? No? We'll think
Won't happen. Walmart loses. Good, fuck 'em!
Walmart requires every supplier have an office in Bentonville, Arkansas to negotiate prices.
It's already happened bubba.
This is old news as far as Walmart is concerned.
Short and and to the point, no bubba here. Only replying to the article Chuckie boy.
When everything becomes a commodity, then the only important factor is price and price alone. Wal-Mart saw that wave first and rode it to the top making tons of money and now tons of enemies. In a few years people will be bitching about the new " greedy bastards" probably Amazon if they can survive. For years Wal-Mart stayed out of groceries because the margins were too thin and too much instability in the products: spoilage in produce, butchers in the meat dept etc... Now food has become just another mass produced, pre-packaged, uniform commodity
I do a fair amount of work for Target Corporation. Over the past few years, I've been trying to do less work for them so I'm not so dependent on them. In the past year they've required everyone who works for them to use a 3rd party billing system (Ariba Network). Now, this might make some sense if I delivered semi's worth of goods to their stores every so often. But since I am a consultant on a project basis, it makes no sense at all. I derive no benefit whatsoever from the new system.
And, if I issue them more than 5 invoices in a year, or do over $50k of business with them in a year, then I have to pay Ariba Networks fees and a percentage of my billings. And I'm explicitly not allowed to mark up my other costs to cover that cost (yeah, right).
My solution? After my 4th project with them this year, now I'm too busy to take their work. And if I were to decide I wanted to do that 5th project, for some reason, I'd charge them an extra day of my time to cover the cost of bookkeeping which they're trying to offload on me.
The thing that bothers me is that I'd expect to get screwed at every turn if I were in a Middle Eastern rug bazaar or a flea market in Mexico. This is supposed to be Fortune 500 companies in America, however. And they have to resort to the cheapest of tricks to maximize revenue now that they can't make as much money as they want selling shit to Americans. They'd rather lend money than sell shit; look at the terms of their layaway plans, which are popular now that they aren't getting as much from their co-branded VISA cards anymore.
When the biggest growth industry in a nation's economy is financial dishonesty, trouble is not just dead ahead; it's already here.
Apps like “Citrix” allow home users to remote-in to access any required applications.
This arrangement transfers costs from the employer to the employee.
The computer is now offsite… so is heating, cooling, electricity… TP and flushing…
That's part of what I like about being self-employed. I don't have to actually go anywhere to be at work. I don't donate any of my time, effort and expense to go to their building. So I don't mind using my heating, cooling, plumbing, etc. Even the formal employment relationship is extraneous. While I am indeed using my own resources, being self-employed, I can deduct my true costs of doing business with them.
The employer/employee relationship as most people see it is really dysfunctional and unhealthy. It makes employees into babies, and employers into deviant parental figures.
If the coin is devalued then the ones producing stuff should charge more. Sit on that inventory until you get your price.
Well that is one of the problems, for many businesses inventory is at an all-time high.
Selling at a loss aint going to make it better.
I predicted this like a decade ago. Soviet Superstore will be one of the first dominoes to fall, in the collapse of US/China relations.
Did you know Sam Walton designed the first Japanese internment camp for the US Army?
I wonder where he got the design for Walmarts?
A Jap internment specialist.
The motto is lower prices always, but it's not actually accurate much of the time. Even Amazon including shipping is very often cheaper. Groceries aren't necessarily cheaper either, even pricing their store brand. The biggest change that I've noticed is the declining product variety, store condition, and number of employees available. I don't hesitate to make a loud scene at the front end and their lack of open check out lines.
Here’s a novel idea. Suppliers should stop supplying to Wal-Mart – sell there wares for twice the price at… Sears.
All the shit is made in China anyway, if it gets cheaper does the world really care whether American1 or American 2 gets the benefit? (Answer :no)
WMT is still the heavy weight champ for ammo, and ain't that what really matters??
Two simple words for WMT: "pound sand"
To get a real assessment of the health of this circle-jerk one need only ask if Walmart employees can afford to shop at Walmart. (Same goes for all the burrito folders and coffee slingers around the world.)
If (when) you consider that Walmart as an organization has in-house training for employees to engage and obtain county welfare benefits then you come to understand the system is untenable.
The fact that such a large employers can skirt the Obamacare rules AND offer no wages to support anyone should otherwise be an Atomic Clock for the collapse of modern "capitalism."
If you want to get a real glimpse of Amerikan retail - walk into a Goodwill.
I went into a local store to get some work clothes. I never saw a store that organized its merchandise by COLOR.
I shit you not. Racks of clothes in the middle of the store with ALL other items sorted by color on the perimeter.
I did not know whether to laugh or cry in that it was likely setup for the employees rather than the patrons.
Idiocracy.
I was thinking the last line before you stated it. It does make you want to laugh, and then seriously cry. God help us all.
Goodwill, a 501(c)(3).
https://en.wikipedia.org/wiki/Goodwill_Industries
Wal-Mart, pay attention!!! Since your customers are mostly FSA, you should become a missionary outfit.
It's called Communism, comrades.
https://en.wikipedia.org/wiki/501(c)_organization#501.28c.29.284.29
Goodwill......They get the stuff for free and charge way too much for most of it. If I really search I can find something now and then at a deal...usualy I walk out of goodwill with a very small bag of items....thehy charge way to much for most of their items, but if you keep an eye you can find a gem or two.....Same as a garage sale.