The Age of Wal-Mart: Inside America’s Most Powerful Company

The Age of Wal-Mart: Inside Americas Most Powerful Company


Today, Wal-Mart is the largest retailer in US, so it allowed it to become the largest private employer in the country. In fact, Wal-Mart has managed to become the most powerful American company. This has caused many questions within the society, which will be discussed in this paper too. First, it will be studied to what extant Wal-Mart is a global company and what kind of relationships it has with producers, particularly in China. Second, the companys effects on American communities and peoples response to Wal-Mart expansion will be analyzed. Finally, there will be a discussion about general impact of the retailer on the US, particularly it will be studied if Wal-Mart is good for the country or not.

1. To what extent is Wal-Mart a global enterprise?

First of all, Wal-Mart has a presence not only in the US but also in many other countries, particularly it has opened 11,000 retail stores in more than twenty countries, including Mexico, China, Germany Canada and Brazil (Humphrey). However, the company has not achieved immediate results in all the countries. For example, Wal-Mart had losses in Brazil and Germany. The company explains its failures by the forgetting to consider local peculiarities. Therefore, after these negative situations, Wal-Mart tries to adapt their strategies to the countries where they start to work. For instance, Wal-Marts managers determined that Chinese customers prefer buying food in their stores, so they offered a wide choice of these products. Moreover, the retailer is planning to increase its presence on the global market and open new stores. One of the most attractive destinations for Wal-Mart is China, where according to the statistics of 2009, it opened 39 stores. The most significant advantage of Chinese market is its size and interest of customers. Moreover, Wal-Mart has informed about its intention to open 1000 new retail stores in China over thirty years.

2. How could one characterize the relationships Wal-Mart has established with producers in China in particular?

Apart from its significant amount of stores, Wal-Mart is famous for changing relationships between producers and retailers. Earlier retailers depended on manufactures but Wal-Mart has changed this and has received a power over suppliers. The company receives most of its goods from Chinese producers due to their low cost. Chinese manufactures are able to reduce prices by paying less to their workers. This is clearly beneficial for both sides.

3. What effect has Wal-Mart had on communities in the United States and how have American communities responded to Wal-Marts efforts to expand its operations in this country?

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However, Wal-Mart produces problems for communities in the US because opening of large supermarkets leads to closing small grocery shops and raising unemployment. In addition, Wal-Mart mainly operates in small towns, so traffic gets increased, which is considered to be negative by local communities. In many cases, the retailer opens its stores instead of closed factories. On one hand it is positive because people get jobs. However, Wal-Marts employees receive smaller salaries and less benefits than factory workers. Even the companys managers are forced to wake up very early and work long hours. It is also part of the culture to save money and avoid of necessary spending. High salaries or comfortable offices are considered waste of money.

All these negative effects provoked protests within American communities. For example, people are strongly against Wal-Marts efforts to expand its operations in the US. Americans believe that this would cause further reducing of standards and losing jobs. The problem is that Wal-Mart imports its goods from other country, particularly from China due to their smaller price. It is good for Americans as customers but it is very bad for them as employees because they have less work. American manufactures cannot just compete with Chinese ones due to necessity to pay high salaries and benefits to their workers.

4. Do you think Wal-Mart is good for America? Why or why not?

It is quite difficult to answer the question whether Wal-Mart is good for America or not. On one hand, it causes many issues for the country. First, it makes the country dependable on other countries, particularly China because other countries can face certain economic or other problems, and Wal-Mart will have to change its operations too. Second, it is negative for American economy to be so dependable on one company. Wal-Mart is the largest employer, so in the case of its bankruptcy, thousands of Americans will get unemployed. It might lead to significant economic issues. Second, expanding of Wal-Marts operations leads to closing grocery shops, so it means that small business is in danger. Third, America is famous its good living standards, high salaries and attractive benefits packages. In the future, it could disappear due to companies focus on low prices. The problem is that companies cannot provide high standards for its employees and low prices for the customers at the same time. On the other hand, Wal-Mart gives work to thousands of people, which leads to reducing unemployment in the whole country.

In conclusion, Wal-Mart demonstrates increasing sales, which allows it to open new stores worldwide. However, not all people are satisfied with this, particularly American communities insist on stopping the companys expansion. They believe that this would lead to further reducing of salaries, closing small grocery shops and increasing discrimination. Therefore, it is possible to say that Wal-Mart is rather bad for America than good.

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