Tear The Wal-s Down

There are a lot of general topics out there that polarize the participants when the subject comes up. ‘I love Kobe’ vs. I HATE Kobe!’ Biggie vs. ‘Pac. Pro-life vs. pro-choice. All matters of opinion based an individuals tastes. One topic that I cram to understand though, is how there is a huge legion of anti Wal-Mart people who swear that the discount giant is ruining business across the board.

A lot of folks I know either like Wal-Mart for its convenience and low prices or despise it because of its low quality products, low wages, and aesthetically poor store designs. There are sites that have side-by-side running debate posts arguing both cases.

They say Wal-Mart kills the little guy businesses. They say Wal-Mart forces everyone to lower their prices and, in turn, kill their own profits. They say Wal-Mart runs the mom-and-pop stores out of their own towns, and generally bullies their way around in whatever municipality they choose to open another monstrosity in. There’s even a book that I read: How Wal-Mart is Destroying America and The World, and What You Can Do About It. This book not only tells, in detail, how Wal-Mart is bad for everyone, but then tells you, in detail, how you can do your part to slow the wrecking ball.

I say Wal-Mart is the American dream at its best.

As far as the argument that Wal-Mart kills the little guy, running small mom-and-pop-been-here-since-the-50s stores out of towns, let’s take a look at where Wal-Mart started. I read Sam Walton’s book (very long and very wordy). Sam used to work for another person’s store as a manager, and when he saw an opportunity to start his own, he did just that. With one store. Just like anyone else. Sam Walton was, at that point, a little guy business owner.

His business faced threats and competition, just like any business today would. But did Sam walk up to City Hall, hat in hand, asking for help? No, he went to work, and wasn’t afraid to get his hands dirty. He shopped in his competitor’s stores and took note of what they were offering. He looked at how his distribution agreements worked and how he could have more control. Sam identified the inefficiencies in his business, and figured on how he could make them strengths. As a result of his work, he was able to lower prices — of course, this is what draws a customer! — and beat his competition.

But it seems that people feel Wal-Mart has done something wrong by simply taking steps to defeat competition. Isn’t that what capitalism is? The best business gets the consumer’s dollar?  In 1970in the New York Times Magazine, Milton Smith laid out the social responsibility of business:

“… to use its resources and engage in activities designed to increase its profits…(through) open and free competition without deception or fraud.”

So yeah, Wal-Mart does muscle smaller, weaker business out of their markets. That’s how business works. I mean, Michael Jordan muscled Charles Barkley, Karl Malone, Patrick Ewing, and John Stockton out of championship rings. Is MJ a bad guy for it? No — just playing the game. It appears to me that Wal-Mart has mastered the Law of Supply and Demand, and found the prices at which what they offer will match how much consumers want. Don’t all business strive to reach this ideal?

Wal-Mart, with its own distribution plants and basic-structure stores, has cornered the market on low prices. But there are other ways to compete. Target has shown that even with slightly higher prices, they can sell quality and ambiance. A Wal-Mart moving into town isn’t a scarlet letter, by any means, for another business. But the second you mentally paint yourself a victim, you become one.

Tags: books, business, conflict, reading