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WalMart Suppliers Brace For The Coming Storm: "Now We Know Why They Have Been Pushing So Hard"
When Wal-Mart moved to hike wages for its lowest paid employees earlier this year, we were quick to note that the fallout would end up rippling through the supply chain. Here’s what we said in April:
The irony is that while WMT (or MCD or GAP or Target) boosts the living standards of its employees by the smallest of fractions, it cripples the cost and wage structure of the entire ecosystem of vendors that feed into it, and what takes place is a veritable avalanche effect where a few cent increase for the lowest paid megacorp employees results in a tidal wave of layoffs for said megacorp's vendors.
Subsequently, the retailer embarked on a series of efforts to extract every last penny of savings from suppliers including i) an effort to compel vendors to forgo marketing expenditures, ii) adding storage fees and manipulating payment schedules, and iii) demanding that suppliers pass along any savings from China’s yuan devaluation.
As we’ve been at pains to explain, this was absolutely inevitable.
When “everyday low prices” is the corporate religion, you can’t pass along rising labor costs to consumers. Add it the fact that WalMart’s customers largely belong to the same tax bracket as the company’s meagerly compensated hourly employees and raising prices simply is not an option.
That means either suppliers suffer, hours are cut, people get laid off, or all of the above.
At Wal-Mart, it’s been all of the above, as workers at some stores report reductions in hours and the Bentonville office looks to cut hundreds of management level positions.
Meanwhile, some of the retailer’s higher paid workers have become disgruntled at the company’s failure to preserve the wage hierarchy (i.e. when you summarily hike wages for one group of employees and not others, you have distorted the pay ladder).
Now, after last week’s dramatic guidance cut and subsequent stock price plunge, suppliers are bracing for the worst. Here’s Reuters:
Suppliers of everything from groceries to sports equipment are already being squeezed for price cuts and cost sharing by Wal-Mart Stores. Now they are bracing for the pressure to ratchet up even more after a shock earnings warning from the retailer last week.
The discount store behemoth has always had a reputation for demanding lower prices from vendors but Reuters has learned from interviews with suppliers and consultants, as well as reviewing some contracts, that even by its standards Wal-Mart has been turning up the heat on them this year.
"The ground is shaking here," said Cameron Smith, head of Cameron Smith & Associates, a major recruiting firm for suppliers located close to Wal-Mart's headquarters in Bentonville, Arkansas. "Suppliers are going to have to help Wal-Mart get back on track."
For the vendors, dealing with Wal-Mart has always been tough because of its size – despite recent troubles it still generates more than $340 billion of annual sales in the U.S. That accounts for more than 10 percent of the American retail market, excluding auto and restaurant sales, and the company increasingly sells a lot overseas too. To risk having brands kicked off Wal-Mart’s shelves because of a dispute over pricing can badly hurt a supplier.
On Wednesday, Wal-Mart stunned Wall Street by forecasting that its earnings would decline by as much as 12 percent in its next fiscal year to January 2017 as it struggles to offset rising costs from increases in the wages of its hourly-paid staff, improvements in its stores, and investments to grow online sales. This at a time when it faces relentless price competition from Amazon.com Inc dollar stores and regional supermarket chains. Keeping the prices it pays suppliers as low as it can is essential if it is to start to claw back some of this cost hit to its margins.
Speaking of Amazon, recall the following which we posted in the aftermath of the guidance cut:
Back to Reuters:
The squeeze on suppliers was clear to those selling to Wal-Mart’s Sam’s Club warehouse clubs around April this year. Sam’s Club’s buyers summoned major vendors to meetings and told them a "cost gap analysis" showed they should be delivering at a lower price, and demanded millions of dollars in discounts on future purchases, according to emails reviewed by Reuters and interviews with suppliers and consultants involved in the talks.
Unlike in prior talks, which featured give and take, vendors were told they could not ask questions at the meetings, with queries to be handled later via email, according to suppliers and consultants involved in or briefed on the meetings.
Yes, no questions allowed, and as we've pointed out before, WalMart can sadly get away with this type of approach to dealing with vendors because after all, if you're a supplier, you're not going to cut your nose off to spite your face by rebelling against your largest revenue stream. Or, as Leon Nicholas, a senior vice president at Kantar Retail, which advises Wal-Mart suppliers put it last month, "you can push and push, but at the end of the day you know where the power lies."
And after last week's carnage, the supply chain is finally beginning to understand why WalMart has become even stingier than normal.
Wednesday's announcement sent ripples through the supplier community in the Bentonville area, where more than 1,000 have offices to stay close to Wal-Mart.
"Now we know why they have been pushing so hard," said an executive at a major consumer goods supplier to both Walmart and Sam's Club, adding that his team was shocked by the projected decline in profits. "Maybe they were banking on more suppliers rolling over on the terms."
Wal-Mart's success in boosting profits could hinge in large part on the willingness of suppliers to sign on to its new terms and agree to its price demands. Despite signs of resistance, one consumer goods supplier reckons most will eventually give in to Wal-Mart’s market power, though not without a fight.
He pushed back after the retailer asked him for new terms that cut 2 percent off his annual sales. They settled on 1 percent, but he fears further demands down the road.
“I just worry that this is a slippery slope of them going in this direction," he said.
A slippery slope indeed, much like the slippery downward slope the company's earnings seem to be on, and between the above mentioned pressure from online retailers and fierce competition from no frills dollar stores, one is left to wonder if perhaps WalMart's move to hike wages may have set the legendary discounter on a path to becoming the next K-Mart.
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I suspect you're right but I pray to every fucking God imaginable that there's another way.
I have three WM stores that are 2-3 miles from my home - they are all different.
A WM store will take on the personality of the surrounding neighborhood.
Even the products they carry are different -
Millions died from starvation and mal-nutrition during the Great Depression. And that was a time when most people lived in rural areas where they could grow crops, raise animals, and trade services. This time will very different.
If you are a vendor who does not want to sell to Walmart, then don't. This is a free market. The retail industry is one of the freest industries we have.
Exactly! The vendors are the ones with the Chinese baubles that they can't sell anywhere else where there might be competition. To get in with WM is to assure sales. Yet, WM will be castigated, now, for being "mean" to the vendors...poor things. WM conceded to appease the Socialists and did the wage increases that were, supposedly, the answer to everything, right? Now, we have trickle down depression on its way.
Bullshit!!
Walmart is know to push their vendors to outsource to China. There are enough of them one record making a claim that they were told to move production to China because it can shave a nickel off the cost.
Fuck China-Mart from here until eternity and sideways with a leper's dick. I hope they go belly up.
precisely my thoughts... stop whining and roll over OR stop whining and tell Walmart to shove it up their ...
Agreed. Walmart is cutthroat. If anyone thinks that they won't take the opportunity of a good disaster they are crazy. How much did this cut into the familie's profits? 2%, 10%, 20%? Fuck them. This is exactly what is wrong with the world... What a bunch of sorry fucks defending the likes of Walmart. As if it is some sort of eithos worth defending. For fuck's sake, it's Walmart. They own most of the country's retail and they are resonsible for thier own shit. Fuck.
miss kmart, last time I saw my cheerleader girl I was in love with at, oh bummer
I just got back from a 1,500 mile road trip from Texas to Missouri - I saw 3 K-Marts. It has been 10 years since I saw a K-Mart that was still in business.
We needed some miscellaneous crap - I wanted to stop at K-Mart but my wife insisted on Walmart -
Since we had been driving for 10 hours we were looking a little ragged - and my wife didn't want to have to go fix her hair and put on nice clothes just so she could go into K-Mart.
That is the difference - you go to Walmart you don't feel the pressure to have to dress up like you do when you are going shopping at K-Mart or Dollar General. ;-O
Low paid jobs are disapearing and the population is increasing, especially from the mass influx of low skilled migrants. With many jobs now being automated and no new 'real jobs' being created to replace them, the future looks bleak for the current population of the west.....this of course is part of the grand plan!
More on the agenda here......
http://beforeitsnews.com/global-unrest/2015/10/the-un-2030-agenda-a-blue...
Start hanging politicians, banksters, CEO's and the elite. That will keep us busy for a year or two. Good volunteer work.
Fuck WalMart, they're a bunch of fucking traitors. The last thing they'll sell before they close their doors will be jelly donuts.
If they layoff Bob Dole from the front door.....you know it's serious.
Welcome to Walmart, Bob Dole loves you.
Bob Dole got Viagra. Bob Dole loves you long time.
Bob Dole says, hold Bob Dole's pencil.
World's largest seller of cheap Chinese shit.
They all sell the same cheap crap. It's downright disgusting to see Walmarts parking lot full of waddling ameriKans packing their new zero down, 10 year payment plan cars with foreign made shit. Then bitch because they can't find a decent job.
Largest, yes; lowest priced seller of cheap Chinese shit, no. That would be Dollar Tree.
My favorite place for pizza pans and cookie sheets, FWIW. For some things thin metal is good, and when they get to rough looking just go get a couple of more.
If you don't mind lead in your cooking trays, pot and pans, then go for it.
Pots and pans, no. No liquids involved here and I usually use parchment paper or aluminum foil
I wouldn't buy any toys there either FWIW.
Excellent value for pregnancy tests, not that this tip will have much impact with the ZH crowd.
seems like an opportune time for china to devalue a little bit more.
Yep, made possible by hundreds of smaller businesses who make them and sell them to WalMart and profit greatly from them. Perhaps the unionized workers from the factories in America might have settled for $15 an hour if they'd known their livlihoods would be gone forever.
No their handlers keep them too ignorant and elitist to have ever accepted 15/hr. Look at the bakers union at Hostess. They rode it right to the grave, even though 4 other unions were pleading with them to negotiate. It has nothing to do with the value of the work to unions, its about strong arming an employer with threats of strikes.
Big Lots, Ollie's, and other salvage stores are the best for quality goods (still made in China...not everything is "cheap" or even inexpensive that's made in China). Have to hunt out the good deals, do without items you may need but are not yet available, AND you will often find unsold WalMart branded stuff there at less than half the cost (mostly seasonal). Clientele is about the same as WM, so put on your body armor and cam corder for an adventure.
Corporate buybacks are going to hurt for those companies with a lot of debt.
word up
Just more of the same, it's the Walmart way. Get your suppliers addicted to YOUR orders, so that you become the majority of their business, and then hammer them as hard as you can on lowering their prices. ALWAYS. Go to their food aisles, all of their packages are different sizes and weights than the normal ones found in regular grocery stores. Another way they get you, unique packaging configurations.
Oh, so it's WalMart's fault that its suppliers want to sell products to the largest retailer in the country?
ALL manufacturers use the different packaging, model numbers, etc. to sell their products. ALL of the retailers negotiate with them to make products just for their stores....Costco, Best Buy, even Amazon has started it.
Ever tried comparing prices by units to find the price that works best for you, instead of bashing WalMart as a fulltime job?
The main reason you see different pack sizes - or slight variations in some products - the same item but a different model number - maybe different color buttons on the TV set --
The supplier WANTS the product to be different - the supplier wants a different model number - it is not because WM demands it.
If you can't figure out why a supplier would want to sell a different item to WM then you have never had a customer call and yell at you because they just saw an item in WM that is being sold for about what they can buy it for wholesale.
Ever try manufacturing the same product going into 100 different SKUs? Sure, suppliers LOVE that. Especially the part where you get to manage a nearly constant stream of artwork change requests for all the printed components. Makes life grand, you know? The customer that orders the largest batch sizes eventually get precedence over the smaller orders/customers, hence Walmart helps enable their suppliers to rely on their orders, since it's easier changover, change control, batch management, purchasing, etc. Managing a few large orders/few SKUs is much easier than managing many small orders/many SKUs. Once a certain percentage of your volume as a supplier starts going to the same customer, they got you by the short & curlies on pricing. You play ball or you start laying people off.
Wait what? I thought consumer spending was being stimulated? /sarc
Fuck Wal Mart
Sincerely,
Mom and Pop
Potentially a Catch 22.....cause Mom and Pop shop at Walmart.
Just keeping it real.
Pop goes to go buy their daily ration of Alpo each week. On the upside, he gets greeted by mom each visit. Really, it is quite romantic.
Alpo was on sale this weekend. 10 cans for $6 at Dillons.
Did you stock up?
Then their kids Dick and Jane keep the corporate fascism going strong with their 666Ks because they still cling to the belief that someday they will retire. It's a closed loop vicious cycle.
Mom and Pop shop Walmart because they lost their small Mom and Pop shop to Walmart when they were driven out of business.
Walmart gets corporate welfare on many fronts:
Fuck Walmart.
I see nothing factually incorrect about that.
WalMart buyer tells the vendor, "I want a banded pack of these 2 products with a $1.99 retail price."
Vendor says, "We will barely break even at $1.99 retail. Sorry, no can do."
WalMart, "If you don't give us the $1.99 banded pack, we won't take your 3 product launches slated for 1Q.
***Chaos at vendor headquarters***
Banded packs produced for WalMart at essentially break even.
KMart Buyer places WalMart banded pack infront of vendor. "We want this, too." What's the pricing?
Vendor to KMart Buyer: $1.49.
KMart Buyer: That's CRAZY. How in the world can you or WalMart make money with that pricing? WE can't make money at that price. No deal.
BUT WAIT, there's more.
Was WalMart billed $1.49 per banded pack? Yes they were invoiced for $1.49 per banded pack.
Here's the kicker...they never paid the $1.49. They paid about $1.00.
This, my friends, is how you get new products into WalMart. This, my friends, is how KMart got screwed. Were they offered the same deal? Technically, yes.
i thought walmart was billed 1.99 for the banded pack. how did the billing go from 1.99 to 1.49? your example says walmart demanded the banded pack for 1.99, then later that they were billed 1.49... so what happened at kmart exactly?
$1.99 is the retail price stamped on the package (think potato chip bags) that the customer sees, but that is not what the store pays.
In this example, the supplier 'sold' it to WMT wholesale for $1.49 each, leaving a .50$ 'margin' on each sale, at least on paper.
When others stores went to them with the $1.99 stamped on it, they were quoted the same $1.49 wholesale, which was not enough to cover the store's overhead. The stores would lose money, except WMT.
WMT has an assortment of chargebacks and fees that skim off the top, so the paper wholesale price of $1.49 was really $1.00 when all other side deals were taken into account. So, WMT was making .99$ per unit retail instead of .50$. Multiplied by millions of units, that's some real money there.
KM got screwed when Eddie Lampert decided he knew all about retail. And then they fell off the already low bar they had set for themselves. Will not miss thee slowest checkouts in the world.
Once, I needed some batterys, AA, popped in, found them, went to check out. 3 lines open. One had the checker on the phone calling for manager, some scammer needed help. Next, she disappears to find whatever. Next line needed price check. When she got no reponse, off she went. 3rd line, same story in 10 sec after line 2. 3 lines, no checkers, nothing. Guess how many times I've been back after just leaving in disgust?
FORWARD CHEAP CHINA! (and utensils)
The last KM here closes after the holiday.
Local Ace Hardware went out of business -
They were right next door to Home Depot - Lowes and Walmart were across the street.
I shopped there sometimes - mostly when I needed nuts and bolts - they had a great selection - any size of nut, bolt, screw, washer in zink, galvanized or stainless steel.
Anyway - I go to the going out of business sale -
They have stuff marked 70% off - and their prices were still higher than HD, Lowes or WM
I wonder why they went out of business? They were always so friendly and helpful.
Price matters, and if they were still that high then yes, they were overpriced.
But price isn't the only factor.
Loved my local Ace hardware when I was still living in Texas. The perfect place to go when you needed some annoying little something because you could get in and out quickly and it was staffed with old gray haired guys that were experienced and could actually help you get the right whatsit to fix your problem.
Bonus:bulk hardware so you could just buy one washer/screw/bolt instead of having to buy a pack of 12.
I also liked the bulk - sand, top soil & mulch they sold.
I would buy a pick up load of mulch every spring - drive out to the pile in their back yard and they would use a front end loader to fill you up - much better quality VS the crap Home Depot sells in bags -
Now I buy 24 bags - haul it out to my truck and load it myself -
I always end up with at least a full bag of large sticks and rocks -
The top soil Ace sold was great for flower beds -
I bought 10 bags to "top quality" top soil from Home Depot - it was 45% dirt 45% sticks and 10% rocks
Sorry, as much as I love Ace, 50 cents for a fucking washer I know was stampped out in china for 0.025 of a cent is fucking insane.
Bye bye Ace
That is an expensive ACE hardware. IIRC prices were more like .08 - .12 per piece.
Could be a really big washer. For a 3/4" bolt or something. Or big and stainless.
There is a major cost component when you carry slower turning inventory, so yes, their prices must be higher.
There is also more cost for employing knowledgeable and reliable people who stay with you and become a part of the business.
Typically, the difference in quality and service is what keeps the successful Mon & Pop alive today. Many are thriving as they have found their niche and figured out how to compete with the big boxes. Many others have already gone away, while still more are headed for the graveyard. The small independent retailer has a tough life of long hours, frustrations with the supply chain, lack of attention from suppliers, high costs with little leverage, and evermore rules and regulations to comply with and taxes to pay. Even if there is no major big box competitor nearby, you live in fear of one showing up and crushing you.
But, that is business, and if you are smart and reasonably well funded to weather storms, there are usually ways to compete for an aggressive merchant.
There is still Ace here in Seattle and doing quite well. They do have higher prices and better selection and good staff.
Place has lots of business, but Seattle is a strange place with lots of weird people who have lots of money.
Will miss ace hardware...
I do miss the good old days of Mom & Pop 5 and dimes, and the department stores at the peak of the 60-70s.
I hope this won't adversely affect the availability of the 99 cent, jumbo bags of Cheese Puffs. Kardashian/NFL night wouldn't be the same without them. Baaaaaaaa....
Have you read the ingredients in those cheese puffs? You might as well eat a snowglobe.
Considering his entertainment choice, eating that won't cause anymore harm to his/her brain.
I LOLed. +10
Whoops! Looks like the Wal-Mart model of doing business WAS a stinking heap of BS after all...!
No, the business model was fine. It was giving into the demands of the progressive hucksters/leeches and raising wages for a job that required nothing more than a warm body to perform that screwed them.
The business model is not fine. I posted some details above. They are not making it on their own, they are using corporate welfare to get the job done.
Then blame the system that permits that to go on, not the entity that makes use of the loophole. And you know I'm right, because, wait for it, ... human nature.
Standard Disclaimer: But if you claim to be what Diogenes was searching for, well, step into the limelight, you'd be the first in a long time.
cheech,
You said the business model was fine. That implies to me that their model was making the money for them, not corporate welfare. Their business model only works if they get government intervention.
Fuck Walmart. Fuck crony capitalism. I hate the playa and the game.
Also it seems to me that so much of the profit goes towards buying/selling/analyzing the stocks there really isn't any room left to pay the people that work there.
Again, you've missed the point. It did not start out that way, but it certainly evolved into precisely what you state. But the Fuck Walmart meme is getting old. Because after Walmart and McDonalds die, who is NEXT on your fucking list? Think long and hard about that. Really long and hard.
Here's a clue.
Walmart employs an astounding 2.1 million people. In the United States alone, the company employs 1.4 million people. This is a staggering 1% of the U.S.'s 140 million working population.
They can all start up Mom and Pop's, right?
Standard Disclaimer: If all I had to do to get up arrows here, sure Fuck Walmart, Fuck Crony Capitalism.
Well said, thank you.
cheech,
Ain't mad at cha'. I do disagree.
They are employing that number while being propped up by our tax dollars. Let it fail and sort itself out. I have faith that people will re-sort things out when that Potemkin monstrosity goes under. Ditto any corporation playin' this game. They do it on our dime because we let them because they have bought the Halls of Congress.
I am biased. I like local and less centralization for my government. The big corporations are getting our tax dollars so that they can stay in business and keep people employed in an artificial environment that would not exist except that our govt. chose them to survive. This is not sustainable. It is a bad business model.
Let mother nature rip. I know that means I might lose my job. I'm waiting for it any way. Quality of life is going down everywhere because of these "business models." There is a point where shortsightedness regarding the impact on the larger economy, and the end user, is going to result in the assination of the golden goose laying the eggs.
What is described in this article is mother nature asserting herself on the equation.
Bad business model.
Sam Walton's model worked, it devolved with the Ivy Leaguers they hired to run it. As someone on ZH pointed out, there's a difference between businessmen and financiers. The family didn't feel like running it and decided they could hire the "BEST" management out there. Unfortunately, the guys they hired have totally different interests and philosophies from the founder. And most of them have never really talked to a Wally Shopper and wash their hands ASAP if they happen to stumble across one.
Same with Mickey D. The heirs don't see any sense in getting their hands dirty, might as well realize their full expression of self with whatever they do. So, Hah-verd seems to have have good people. Didn't buffy date some finance wizard at Yale? They hire these know nothings who have the pals in congress to grease the welfare state(it works for the needs of both), the pals to grease Wall St., run it into the ground and voila. Here we are.
FORWARD SOVIET GLOBALISTS!
go figure
The economy is so good that people no longer need the likes of Walmart.
I'm waiting for Nordstrums to add a grocery section....and tires...
Let them shop at Niemann Marcus.
Remember the story on Needless Markup? People were trying to impress their neighbors by putting trash in Needless Markup bags on the street for garbage pickup. They wouldn't pick it up because Biohazardous waste was put into red bags. Don't know if it is true or not, but funny.
@Bastiat,
I prefer Niemann MakeUs. ;)
Always custom.
Sheesh...they're erecting a new cell tower less than 1 mile from another on WhaleMart property & building a new WMT right by a very upscale neighborhood here.
ManOman are those homeowners pithed.
Towers gps, yah think martial law
i see no problem here - market supply and demand forces battling here. You either sell for the price the buyer is wiling to buy or go find another buyer or go out of business
I just raised my prices to remove rubbish from walmart by 25%, why? Because you don't fuck with Rubbish, Rubbish stinks, Rubbish is nasty.
Walmart go to hell and back.
Gold Bitchez.....I pick up pennies
"When “everyday low prices” is the corporate religion, you can’t pass along rising labor costs to consumers. That means either suppliers suffer, hours are cut, people get laid off, or all of the above."
You forgot lower profits and executive compensation LOL.
The problems for both walmart and mcdonalds stem from their lowest paid workers making too much money.
I dunno, something just doesn't seem right about this.
Romans 1:28-32 will explain all of it, but one must be able to take what having a useless mind actually looks like in the world we live in.
I can tell you this much; we haven't begin to experience the pain we are going to experience because of divine judgment. The surreal world we live in is a mere shadow of the real substance, a substance that most cannot see much less comprehend if they did see it...as it is written and as we were forewarned and ignored.
Let's see go from a minimum wage of $7.25/hr to $15/hr.
So $7.75 more per hour for breathing (err wasting oxygen) or a percentage increase of 106.9%.
You're quite right... everyone's wages need to increase by one or the other, right?
Standard Progressive Disclaimer: If you go by percentage increase, I would then be able to buy a Tesla and pay fucking cash. How is this not great for the economy?
I don't know where the $15 an hour target came from. But our current minimum pretty much guarantees that people paid that wage qualify for government subsidy.
I did the math a while back and came up with $11.59 as a reasonable target for minimum wage.
Most low wage jobs are not full time, so planning on the average under 30 hours a week a single worker with no dependents would need to make $11.59 an hour in order to not qualify for most government handouts which are generally capped at 150% of the Federal poverty line.
>I don't know where the $15 an hour target came from.
Stop pretending you live under a rock...
I know that number has been in the media, just don't know why $15 instead of some other nice round number. If there is some particular significance to 15 then I admit I've missed it.
Then let's play the game of wage inflation with what the Democrats's want...
http://thehill.com/policy/finance/other/241019-dems-bet-on-push-for-12-m...
Is that more reasonable?
Standard Disclaimer: Should not all wages go up by a percentage of what they want to raise minimum wage by? It's only fair, isn't it? After all, it's such hard work to be a burger flipper.
Here's something else to think about... Raise the minimum wage, or end the Federal Reserve?
Standard Disclaimer: If you are for raising the minimum wage, then you are basically telling me you are for a continuation of the Federal Reserve which has done nothing but devalue our currency since it's inception.
I would prefer sound money to the Federal Reserve.
But I would also prefer to not subsidize billionaires.
A lot of people on ZH like to hate on the FSA and low wage workers. Rarely do those same threads include the inconvenient fact that the US doesn't have enough good paying middle class jobs for all of our working age people. So, sure, everyone should try their damnedest to improve their own skillset to get ahead, but there will be losers.
I don't think it is too radical to suggest that an employed person with no dependents working the usual amount of hours should make more than 150% of the Federal poverty line. If a business needs that kind of subsidy to survive then be honest about it - cap their profits at a percentage to keep that subsidy and don't let them double dip by also collecting tax deductions for hiring the poor.
I'm actually pro-business, particularly small business. I would like to see FICA dropped as it is a drag on employment. Just toss it on the pile with the rest of the government budget and finance through income tax; graduated simple flat tax with no tax up to 200% of the Federal Poverty Line if someone wants to make me temporary dictator. Imagine that plus the maligned single payer so that employers would no longer be on the hook for paying for health insurance. Might preserve some employment for awhile and keep us more competitive vs. robots.
America's poor...
http://www.forbes.com/sites/timworstall/2013/06/01/astonishing-numbers-a...
The Independent Payment Review Board can help with this problem. In fact, it is designed to correct the imbalance of the old and/or stupid vis a vis the productive.
The Old Fabian, George Bernard Shaw, let the cat out of the bag long ago, that the people should be made to "justify their existence" by producing what they consume and "maybe a bit more", so the likes of Shaw could be "productive" writing and ruling. And those whose existence could not be justified? Dear George wistfully prayed for a "gentlemanly gas" that would rid the world of the useless.
No wonder Sanger(lover of Fabian H.G. Wells) found them to be her kind of people. Himmler, Heydrich and Eichman sure liked what they heard and derived Zyklon B to help further the cause of the Fabians. Remember, Keynes was a Fabian.
FORWARD GLOBALIST SOVIETS!
"The problems for both walmart and mcdonalds stem from their lowest paid workers making too much money.
I dunno, something just doesn't seem right about this"
Mostly ILLEGALS to boot.
Sadly Walmart is NOT the bargain shoppers paradise.I have seen dozens of food items they are a lot more expensive on than Tom Thumb/Kroger.The only thing I would ever get from Wally Worold is cases of bottled water,CVS/Walgreens, regularly beat their butts on all name brand sodas,Coke,Pepsi,Dr.Pepper, etc,etc.
NO workers on duty, one to oversee self checkout,ans ONE walk thru open early a.m. out of 13 lanes, its always the farthest from self checkout.
For YEARS they have TOLD their suppliers what they would PAY, take it or leave it, and then pay very late on the same.Vendors lose money on Walmart the only way they can make a dime os on volume.
At some point the quality is going to go down too. Not that Wal Mart is famous for quality but its going to get worse. Those $10 shirts are going to get thinner and thinner.
Why I shop at Walmart... For the $13 sneakers made in China. They are, after all, dual use. After I'm done wearing them (6 months top), I go buy another pair, and the old ones get to be my dog's next chew toy.
But you go ahead and spend (waste?) your money on Nike's. I'm just a cheap bastard.
I have narrow feet with high arches. Sure, I could buy $13 plastic shoes and wear them for 6 months, half that time with painful strained arches.
I do a lot better buying $120 New Balance sneakers that fit my feet and last 3 or 4 years. I buy $250 Cole-Haan oxfords that still look new after 10 years, and a couple of $30 heel replacements.
The dog can find his own damn chew toys. We call them "squirrels" where I grew up.
You're right about Nikes, though. A $20 show with a $200 logo stitched on. Using the best stitching in the whole damn shoe.
I do a lot better buying $120 New Balance sneakers that fit my feet and last 3 or 4 years.
My cost at Walmart: Go with the outside figure of 4 years. $13x8=$104...and I have money left over to buy another pair. Sorry you were not blessed with better feet. I just have better things to do with the money than buy whatever happens to be advertised to you as this weeks current status symbol...
Seriously, does this appeal to you?
http://www.newbalance.com/nyc-running-gear-for-men-and-women/?ICID=NYC15...
>I buy $250 Cole-Haan oxfords that still look new after 10 years, and a couple of $30 heel replacements.
However, we are talking sneakers, not dress shoes, and I could agree with you on that point, I will buy quality when necessary. I put a lot of wear and tear on the sneakers, when I am not donning a more expensive pair of work boots.
I only buy the New Balance sneakers because they fit. They make them in sizes. So I can get a pair of 11-1/2 A-width sneakers. The generics, and indeed most sneakers, are sold in D-width only.
That link is hysterically funny. Not something I would buy in the least.
If I could buy a non-branded pair of shoes cut to fit my feet, I'd do it in a heartbeat. I've worked in and around advertising and Marketing long enough I cut off most visible brand tags. I can't afford to accidentally wear a pair of New Balance sneakers to a meeting with people from Converse, for instance.
I've never seen a pair of work boots I'd call "Expensive." Some aren't worth the price, but usually those are the cheaper ones.
Management was the big problem when I worked for wallyworld... They the problem
Of course, the increased spending of said workers and its positive effect on the overall economy is never mentioned. Here's a thought.. raise prices a little.. gasp!
2016 is shaping up to look like 1940.
WWII started before that.
It takes time to start a worldwide war.
Dear Wallys - being politically correct and removing AR-15s and Confederate flags does not just result in lost revenues from those products - it also results in lost customers!
Exactly. Any company that drops their pants for the SJW's obviously doesn't need my money.
Had to google SJW. Hadn't seen that before. Social Justice Warrior. Pissants of the American culture.
Thanks for that. :)
I had NO IDEA what SJW was. :)
have you been living in a cave?
Where are ur ar-15's? mofos
Credit ends today... nothing on the shelves!!! Go get pasta and rice... everything will grind to a halt... GET AMMO!
Looking forward to it, fun madmax! Crystal Method, u got it!
Yep,,, Cheap has become ameriKa's theme. Everything has to be cheap. Even have stores with names like Dirtcheap Building Supplies. Quality? Well we don't care so long as it's c h e a p!
Of course when we get it home and it breaks we gripe and complain,,, then go out and see if we can find it cheaper!
Actually cheap is another form of inflation. If you ate and bought things of the quality of the 60's; you would find it would cost substantially more, but we would be healthier...maybe.
Rejected made me think of the one time I bought something at Harbor Freight. I bought some clamps thinking: 'These look pretty cheap, but they are so cheap even if I get some use out of them, I'll be ahead.'
They broke in the back of my truck on the way home. LMAO
Don't shop there, don't shop at Walmart either.
http://www.fastcompany.com/54763/man-who-said-no-wal-mart
I may go out & buy a new mower this weekend. I don't need it (our lot is mostly woods & my son uses a reel mower on the little grass we have) but I can afford it & it seems appropriate - maybe I'll give them as xmas gifts this yr?
btw - in addition to her $125k/pop speeches to lloyd, jamie, etc hrc used to be on wal-mart's board in the 80s...
Make sure you check Walmart's prices on Snapper Mowers. Seems the man who said no to Walmart caved. He probably hired a service to mow his lawn as well.
http://www.walmart.com/search/?query=snapper
well, that is sad to hear... I remember reading the article when it came out nearly a decade ago...
As I am fond of saying to business people.....margin compression is the root of all evil in business.
You can't squeeze blood out of a turnip. At some point, prices will have to rise on everything. All the tricks have been played: smaller box sizes, squeezing suppliers. But, the fed has said there is no inflation so perhaps I have it all wrong.
Nah. You're not wrong. They lied.
That Supply / Demand thingy is a biotch aint it?
Yep, the next K-mart; in many stores it is already there.
Dog eat dog world, I tell ya! Now look for the return of Mom and Pop locally owned stores. Big box stores are dying due to usual overhead and overextended. The thing to invest in just might be DOLLAR stores... Hmmmm I should look into this...
Funny what happens to profitability over the years after a handful of people extract, say, a hundred billion dollars out of a business. Public retail companies are very typically grow-or-die speculations. Grow or die...you know, like a financial pyramid. All of America's problems originate at the top but all of the officially sanctioned solutions are aimed at the bottom.
Grow-or-die is the problem, and it's rooted in the foundation of a system where money is actually debt at interest. Such a system has to collapse, usually once a generation or so, or the debt grows to the point that it can't be repaid. Then the inevitable crash becomes utterly catastrophic.
I've worked full-time since I was 16 (33 years). Never for a company with more than 50 employees. All but 2 of the companies I've worked for (say, about 20 total) are out of business. Every one went out of business through a bone-headed expansion scheme. There was a point at each of these companies when all the bills were getting paid, all the employees and the owners were getting paid, business was coming in, and everything was both hunky and dory, all at once. But that wasn't nearly good enough; the owners got all kinds of alarming advice that they had to grow to survive. And they all took on shitpiles of debt to grow, and couldn't grow fast or efficiently enough to pay that debt. Liquidation followed very quickly, every time. I learned to detect "The Smell Of Death" and get out months before the paychecks bounced, after the first couple times through the process.
On the other hand, I can think of businesses that had been competitors, who resisted all the urgings to grow, who are still in business and doing fine. Their owners aren't tycoons, but everybody kept their jobs and still gets paid.
THE POST on this thread. DEBT and the very creators and controllers of same are THIS PROBLEM. Our founding fathers warned YOU of this. YET, we've now allowed our Legislators, Executive adn Judicial Branches to completely usurp those founding principles.
Beginning iwth the Federal Reserve Act itself.....unconstitutional....and shepherded in under cover of darkness.
Glass-Stegall killed by Gramm-Leach-Blyly.
2007 Papered over by Bailing out, Off Bal Shting (ENRON) for everyone along with suspension of FASBY GAAP Accounting Requirements, Off Bal Sht Derivative Creation and Authorization by CONgress to allow the FRAUDS to go on, etc, etal..........
We should roll the guillotines today to avoid even further damage and harm certain tomorrow. These CRIMINALS will never stop voluntarily.
Walmart and the rest of the economy are being crushed by big progressive government tyranny. Big mafia government needs to be cut down to size and get the fuck out of business and get the fuck out of my face and my wallet. Big progressive criminal government is the crime here.
Grimaldus
wow you must be stoned. without the welfare state wmt would be tits up
So would every other major retailler. What's your point?
dipshit wrote:
Walmart and the rest of the economy are being crushed by big progressive government tyranny...
that's my point asswipe.
There have been suppliers to Walmart who have "shrugged" in the past and simply said "no thanks" and stopped supplying them goods. Some have gone on to be far more profitable and successful. Someone above ^^^ mentioned the situation as akin to a drug addiction - that's spot on. Soon these food producers, durable goods producers, etc. will create a co-op and sell their goods in a different format and forget all about Walmart. Systems like Walmart come and go - looks like Walmart is poised for extinction if you ask me. Even their business model is getting antiquated.
Just say no to debt and servitude. Simple...
Is Walmart the McDonalds of megastores?
"Blood from a stone" comes to mind.
Sooner or later, the supplier will have to answer this question:
"Why sign a million dollar contract when it costs more than a million to supply it?"
Death by a thousand cuts.
"You're no longer my largest channel to market. I don't have these discussions with Amazon. Why should I take a hit on my margins so you can pay a stocking clerk more? Your retailer competitor is working with me to lower costs to market. You call me into a meeting with an analysis of how much you want me to lower my wholesale price to you? You have Sam's Choice. Undercut me if you think the margins and inventory turnover are there."
Let me fix that for you:
"Why should I take a hit on my margins so you can put gold lettering on your power boat?"
Did you see how many Waltons are on the Forbes list?
Get the money from them!
Walmart just needs to put in place a policy to charge their fat-ass shoppers a quarter to use their motorized scooter-carts and their profits will triple.
When Walmart closes America might then reopen for business.
I have no sympathy for Wal-Mart or their suppliers. They have been a large part of the problem for many years of "conditioning" a whole generation of shoppers and corporations that cheaper is better. Suppliers have reluctantly gone along, because when your business is dependent on 30%, 60%, or even 99% of sales to one customer, Wal-Mart, GM, Ford, etc.,at very low, or even mandated margins, you are screwed.
Unsustainable business models, bad fundamentals, high leveraged and mis-managed companies usually end spectacularly and badly, but, this is the new and improved normal. Cooked books, GAAP, stock buybacks, LBO's and outright fraud have masked and hidden all of these glaring deficiencies for far too long.
Greed and expediency have permanently taken over plain, fair and square dealing. Which is why I am no longer a "private enterpriser," something I dearly miss, but choose to no longer participate in...
When “everyday low prices” is the corporate religion, you can’t pass along rising labor costs to consumers. Add it the fact that WalMart’s customers largely belong to the same tax bracket as the company’s meagerly compensated hourly employees and raising prices simply is not an option. "
So, corporate hot shots, what does THAT tell you?
It tells you the middle class is broke, and can't consume as it once did.
Want to do something useful?
Stop pressuring suppliers for the lowest prices, and START pressuring industry to stop outsourcing the means of weath creation in this country: good-paying, middle class manufacturing JOBS.
Consumers can't spend what they don't have.
It has NOTHING to do with raising paltry wages; it has to do with meaningful incomes FIRST.
Your very business practice ENCOURAGED outsourcing.
Well...these are the results.
Shut your whinny mouths, and get busy helping to turn it around, or beat it.
We got along fine without Walmart once before, and I'll bet we can get by without them tomorrow.
Might even be therapeutic too...
m
Jobs going to China are a symptom.
The devaluation of our currency due to debt, over-printing, and fractional reserve lending is the problem. Congress knows this and that is why they have altered our laws to allow this sort of outsourcing. If they didn't do this hand in hand with the devaluation of our currency the whole game would have crashed a long time ago.
See, by allowing the goods to become "cheaper" the middle class has maintained an artificial standard of living and remains pacified.
But... all this is simply "borrowing from the future". We're now seeing that this sort of game always runs its course - the world economy is running out of time.
Respectfully, that's NOT correct.
Western corporate outsourcing is THE cause of our plight, and it's been occurring for more than 40 years.
We were told over and over by intelligent and knowledgeable people what was going to happen if it wasn't stopped, or at least, seriously slowed, but we didn't listen.
EVERYTHING else we're experiencing now is a function of failed and intellectually-flawed (brainless) monetary and corporate policy (share buybacks) trying, yet again, to shock a fatally-damaged economy to life.
EVERYTHING.
Instead of recognizing the problem, these hacks saved TBTF behemoths, shack buyers (as if deleterious and artificially-inflated shacks represented real wealth; they do NOT), autos (especially, subprime), insurance companies, and all the rest...
...as though ANY of that could restore or replace a first-world economy, given away, without the slightest regard for what happens when the incomes are gone.
The bastards were told, but refused to listen.
We're not coming off the life support (zirp, for example) because there's nothing behind it.
You can't destroy middle class income in a 70% consumer spending-driven economy for more than FOUR decades, replace it with nothing, and expect to maintain a first-world standard of living. Not even the largest economy, nor the Cold War-winning superpower, can do that...as we can clearly see.
It's as simple as that.
It's terribly important we get, and keep, the sequence of events straight. Indeed, it's critical to any effort to successfully redesign a new economy, post-cathartic crash.
These corporate SOB's CANNOT ever be allowed to do this in the future, should we be lucky, painful though it will be, to actually still have one.
m
Short version: Don't cut open the goose that lays the golden egg every day. There might be a couple gold eggs in there you can get today, but then no more forever after that.
And either fire your own asses or drastically cut your pay since visionary leadership and an understanding of the marketplace is the reason for your f*cking existence as execs in the first place.
OK, layoffs in China. Why do I care?
time to remodel some more bathrooms
When you are a supplier to a single major client, you have a tiger by the tail and you might end up inside the tiger's stomach.
So, why is there a picture of K-mart at the head of the article on Wal-Mart?
cause Walmart is the New K Mart
Because Wal-Mart, just like K-Mart, will so too, go the way of the dinasours and the Do-Do birds.
Walmart raises wages (Quid) Walmart receives favor (Quo) Just watch closely, it's coming.
F ChinaMart, bring back the Blue LIght Special!
suppliers need to get away from evil walmart and start a cooperative