Saturday, July 03, 2010

Wal Mart Bad for Economy?

Is Walmart bad for the economy? |

My response?

In my opinion Wal Mart is bad for the economy because it has essentially put the mom and pop shops out of business.

Sure, when they put up a new store they create more jobs, but in my opinion every time they put up a store in a new area they create what I'll call one-sided competition.
There are a few people out there that are still willing to go to the smaller shops out of principle but when they (Wal Mart) charges next to nothing for the same or similar products, there is no way these smaller businesses can stay in business.

Sure, the local businesses provide things like developing a relationship with the customers but in an economy as volatile as ours, most people don't care about those sorts of things anymore, they just want cheap and they want it now and Wal Mart is playing on those feelings.

Not really blaming them. They are a corporation and they are smart. So I'm not blaming them, I'm just stating why I think they are bad for the economy.


  1. I can see how that would be true in a small town, but in larger cities smaller businesses actually can create the same low prices because their volume of sales is larger and a good infrastructure of shipping and import businesses exists to do what WalMart does out of its headquarters for them inexpensively. WalMart is good for places like Atlanta and Seattle where the volume is not small enough for one business to take the entire market, and the total freight haul is large enough for a support net to exist for small business, but for small or even medium-sized towns it can be a major problem.

    On the flip side though, even with WalMart the overall percentage of the economy which is in the hands of small business has actually increased because with robotics and the affordable industrial machinery they create, it is now possible for much smaller, lower capital businesses to efficiently produce manufactured goods. Thus we are also seeing the rise of the Ma and Pa manufacturer.

  2. Jeremy--You sparked my curiousity so can you cite some sources for the stats on the rise of the Ma and Pa manufacturer? And what about Ma and Pa retail stores as Steve referenced. I assume the stats might be different for that.

    Also there actually is no Wal-Mart in Seattle. Just a Sam's Club. I think this is evidence that Wal-Mart is aware of what you are talking about and steers clear of places they can't perform a takeover on. Wal-Mart is not good for Seattle since they aren't here.