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Wal-Mart Squeezing Record Labels to Cut CD Prices
Raindance writes "RollingStone.com has a revealing article detailing how retail giant Wal-Mart is making loud noises about throwing its weight around in order to get significantly better bulk prices on CDs. Says one industry executive, 'This wasn't framed as a gentle negotiation, it's a line in the sand -- you don't do this, then the threat is [your product is dropped].' This is the first time a big player has attempted this sort of hardball move on the labels, and the labels may be forced to deal, as Wal-Mart sells 1 out of every 5 retail CDs. Monopoly one, meet monopoly two."
Tensions are not as high now as they were last winter, but making sure Wal-Mart is happy remains one of the music industry's major priorities.
How about making the customers happy? Personally, I can't believe that 1 out of 5 CDs are sold in Walmarts. I can't stand their stores. I absolutely DREAD entering one. They aren't clean, they aren't friendly after you pass the greeter, and they aren't someplace that I want to shop for music as it's just usually a mess and full of people.
Why not concentrate on making music available for less money somewhere that I might want to buy it instead of worrying about making sure Walmart is happy.
Virtually no industry executives would publicly comment about their company's relationship with Wal-Mart. But off the record, many record-industry executives shared their concerns. "I don't think there is a music supplier in America who really enjoys doing business with Wal-Mart," says one major-label rep.
Awww, are we supposed to feel sorry for them? Am I supposed to shed a tear from the corner of my drying eyes that they don't like something? Here's the river... Notice it's dry.
I don't like dealing with either company and I certainly don't think that Walmart is going to bat for the consumer. They are only doing this to make themselves richer. We aren't exactly benefiting by buying a $10 CD.
Wal-Mart is like no traditional record seller. Unlike a typical Tower store, which stocks 60,000 titles, an average Wal-Mart carries about 5,000 CDs. That leaves little room on the shelf for developing artists or independent labels.
I was at Walmart recently buying something I couldn't find at Target. I happened to stop into the electronics section while my fiancé did some shopping elsewhere. Perhaps I wasn't looking in the right spots but I wasn't finding anything by developing and independent artists. If anything it was most older music that wasn't exactly getting radio play. I saw the typical teenybopper crap but nothing that I would consider new and exciting.
"When you're buying CDs for twelve dollars and selling them for ten like Wal-Mart, it makes the rest of us look like we're gouging the customer, when we're not," says Don Van Cleave, head of the Coalition for Independent Music Stores, a retail consortium. "It's supertough to compete with that price point."
Most independent stores I have gone to shop for music in are charing $16+ for a CD. If you're buying it for $12 and making $4+ a CD I seriously believe that you are gouging us. I don't feel bad for you.
"They proposed it to a bunch of artists and managers, but everyone was worried that we are sending a message that instead of the sixteen-track album we sold, those nine extra songs were filler," says a label executive.
You sent the message when we bought your shit music for $16+ and found that 14 of the songs were filler. Walmart didn't help to spread that message... Your crappy albums did.
I really dont think you could label Walmart as a monopoly by any stretch of the word. THere are plenty of competing businesses, Walmart is jsut the biggest.
Nothing like having to take it as well as dish it out.
Ironically, if they give in and sell cheaper it will probably result in MORE money for all involved, since people will be able to buy more CDs without feeling quite so ill at the prices.
Can't say I'm real happy about Walmart having so much power though. Frankly I don't trust any business with so much power. But I will say I'm inclined to worry about Clear Channel more than Walmart, since for most of Walmart's products the barrior to entry in the market isn't unthinkably high.
"I object to doing things that computers can do." -- Olin Shivers, lispers.org
If you're buying it for $12 and making $4+ a CD I seriously believe that you are gouging us.
Making a profit on a 33% mark-up is gouging? Sheesh, I had no idea that CDs should be sold for one penny more than they were purchased.
Most independent stores I have gone to shop for music in are charing $16+ for a CD. If you're buying it for $12 and making $4+ a CD I seriously believe that you are gouging us.
Do you honestly think that a mom and pop record store is buying discs in the same volume at the same price as the largest retail juggernaut in the history of this planet?
Where does the school board find them and why do they keep sending them to ME?
Monopoly one, meet monopoly two.
You are completely misusing the word. Walmart is a leader in the incredibly competative retail sector. They got that way by being maniacly efficient and offering low prices on goods people need. They compete with other strong retailers (Target, Sears, Home Depot ...) everyday
to the benefit of everyone. To make money they require
volume. To create volume Walmart
must offer low prices. The RIAA is under
the same market pressures as any other Walmart
supplier.
an ill wind that blows no good
If Walmart wins will that pass the savings on to the consumer or do something for their horribly treated workers like give them health care?
Probably neither, why should we care.
Just two big behemoths fighting over a scrap of plunder
Reading through all of your comments, all I see is that they are all super-biased and don't actually involve any rational thought. You are a selfish, elitist prick.
No offense, but having a strong opinion is not a crime. You're certainly not going to change that opinion by throwing around insults, either. The guy may have his problems (or he may not, I don't know), but intelligent discourse is a much better way of getting him to change his mind. For all you know he may be a very intelligent person who you would often agree with, or at least enjoy debating with.
Sorry to interrupt, carry on.
Javascript + Nintendo DSi = DSiCade
I just thought I'd tack something onto that post--a bit of math in case you don't understand my point. Purchasing 60,000 CDs at one unit each is $720,000. If you expect a store to shell out enough to carry ten each of those most-popular 5,000 CDs and still carry one each of the rest, you're talking $1,260,000. At EACH store branch! Up front, with no chance of recouping most of them, offering that variety for you as a customer so you can have what you clearly desire: choice!
Assuming they want to stock enough to not lose sales to the store-next-door if they sell one of those 55,000 albums of which they only stock one, they need to tack on another $660,000 in stock. If you were to go try and borrow that kind of money, it'd cost you all your profits just to pay the interest!
I seriously cannot believe you fault indie-er record stores for charging what they charge, man. It's really, really pathetic.
Read jack phelps dot net
I'm still not buying any more RIAA CDs, Walmart or elsewhere.
Me too. I listen to internet radio and look for nice mixes around the web and all of them are indy. I could care less about the RIAA. They are goons. The RIAA operates like Jimmy Hoffa's Teamsters once did; oppression by coercion. The Teamsters took a beneficial idea (a trade union) and turned it into a money grubbing business front for organized crime. It's the same thing the RIAA has done with music, perhaps without the organized crime, but you never know. Music used to be free, but then the Metallica bands came along with their business plans. Metallica are sellouts. Who wants to put more cash in their pockets? I would much rather support a starving artist with new ideas.
The dangers of knowledge trigger emotional distress in human beings.
"Paying fifteen dollars for a piece of music is a difficult value equation for customers."
WOW! Is it ever. Apparently Walmart marketers understand the music biz better than the music biz people.
At Wal-Mart, we're a commodity and have to fight for shelf space like Colgate fights for shelf space."
Which is why people go to walmart. Walmart is like a commodity store. Are we going to sell the new Eminem CD based on the "Intrinsic Value" of the liner notes or the number of hits on the CD?
Then the article says:
Unlike a typical Tower store, which stocks 60,000 titles, an average Wal-Mart carries about 5,000 CDs.
and then
. "When you're buying CDs for twelve dollars and selling them for ten like Wal-Mart, it makes the rest of us look like we're gouging the customer, when we're not," says Don Van Cleave, head of the Coalition for Independent Music Stores, a retail consortium. "It's supertough to compete with that price point."
Well, Don Van Cleave, there you go! Your message to consumers needs to be, your prices are higher, but they have to be because you carry a much larger inventory and your large selection is a service your store is providing. Have tastes that go beyond the top of the charts? Well guess what, your music is in our store, and for the selection we have our price while still not the best, they are very fair. Now you're not selling a commodity. You are selling a service. You are selling expertise that perhaps your music staff has. But instead, you people try to do the same thing - push the hits.
My girlfriend took a temporary position at a cocunuts store here in town. And let me tell you, they don't get the sell based on value thing. They push the hits, hits, hits. The kind of CDs you will listen to for a month or two and then forget. How is that kind of CD worth $15? It's not. She has pretty diverse tastes, and has broken "company code" by playing other "non-corporate approved" kinds of music,a nd has had a lot of sucess selling it. She figures every time she plays something, even if it's old, she has 5 or 6 people that ask "What is this?It's interesting". And a lot of them buy it. Now imagine what could happen if the whole store's marketing was geared that way. You could sell a good amount of that older or lesser known stuff, for a higher price. And you could still take the hits, and trim the price way down, as a loss leader, to get people in the first place. Maybe you can't go sub-cost like walmart, but you can get down close.
Kudos to Walmart for beating the record industries margins down. As long as they only stock 5000 cds in each store, independent retailers should have no worries if they figure out how to position themselves correctly. The beauty of this is it could also force the record companies to sell to distributors and record stores for a lower price, actually helping the smaller guys.
Easy guys, I put my pants on one leg at a time. The difference is after I put on my pants I make gold records!
Why not concentrate on making music available for less money somewhere that I might want to buy it instead of worrying about making sure Walmart is happy.
While much of what you say about the stores are true, you should feel sorry for the folks trapped working there. I've worked at one, appalling is about the only word that comes close to describing how management treats employees. Many of the people there can't find other work, or Wal-mart pays more than anything else they can find. Wal-mart knows this and abuses it. I fully expect there to be lots more class-action lawsuits against the company in the near future, even with current ones they're getting worse if anything.
But the 1 in 5 figure is quite believable. While Wal-mart might not have as large a selection, their core customer base isn't looking for one. The CDs sell like proverbial hotcakes at even smaller Wal-marts, bigger ones move so many it's scary. Around here (Tennessee) there are very few chain record stores left. Of the two malls in the closest large city to me, there's one record store apiece. There are a few small retailers, but the biggest of those is a local used-CD chain (two locations).
On this one you're both right and wrong. Wal-mart is indeed wanting to make more money, but their entire business plan is to buy low and pass along the savings, keeping profit margins lower and making up their money by selling tons of the stuff. Anything Wal-mart can get cheaper will benefit consumers because then the consumers will get it cheaper. Granted Wal-mart's not doing it because they're some grand benefactor, but the end result helps consumers a bit. Actually I suspect that Wal-mart is pushing for this because the overwhelming consensus of their customers is that the CDs cost too much, even at Wal-mart's prices. (I worked in Electronics, you hear this constantly, although people still buy.)
I was at Walmart recently buying something I couldn't find at Target. I happened to stop into the electronics section while my fiancé did some shopping elsewhere. Perhaps I wasn't looking in the right spots but I wasn't finding anything by developing and independent artists. If anything it was most older music that wasn't exactly getting radio play. I saw the typical teenybopper crap but nothing that I would consider new and exciting.
Umm, did you not read the sentence you posted? It said it left little room, which is exactly what you found to be true. Wal-mart's not big on new and exciting though, they're big on selling decent stuff cheap and lots of it. Independent artists and developing artists don't fit that so it's no surprise they're absent.
It is interesting to note that Wal-mart doesn't handle the merchandising of the CDs itself, they hire a company that does it, so I'm not sure how much direct control Wal-mart has over exactly what is on the racks.
While it's hard to understand t
I have a very different take on Walmart. They are successful for one reason-they market what consumers want. This is what makes them different from the Redmond Giant. Walmart has made themselves based on extraordinarily good pricing. Their methods of getting that pricing are sometimes dubious, sure, but they provide what people want, and usually at a good price.
Will they continue to do so once they have wiped out all the competition? Probably not, but I don't think that Walmart will ever be competition free.
There will always be conscientious objectors to the big W, and they will shop somewhere else. There is Target, which has made some very smart decisions on how to carry a very similar product line, yet be compelling. They are price competitive on most items, but they also market to a higher class customer, and tend to have more trendy goods than Walmart (their home decor is especially telling). I think target is here to stay. They are avoiding the mistake of Kmart, and not trying to imitate Walmart to closely (which is what killed Kmart, largely--there was little to differentiate the two, and Walmart consistently beat them on price).
Is Walmart perfect? No. I hope they get slammed in the current class action suit under Title VII (gender discrimination in wages). They deserve it.
Can people earn a living at Walmart? Probably not until you get to the Management level. This means that you need to either work your way up, or move on. It makes the perfect job for high-school and college kids trying to make a few extra bucks. It doesn't work for anyone with the desire to work there for the rest of their lives, unless they can make management.
"We don't know what we are doing, but we are doing it very carefully,..." Wherry, R.J. Personnel Psychology (1995)
After college I worked at a great independent bookstore for about 3 1/2 years, just at Burns Ignoble (Barnes & Noble) was starting to drop store everywhere.
More than once UPS, USPS, etc dropped off the wrong box in the shipping room, intended for B&N, we'd be opening boxes quickly usually and didn't always notice until we looked at the invoice. The discount a place like B&N gets over the independent is significant, like 8-12% more. This is a similiar situation with record stores.
When you're running close margins to begin with and your comptetitor is getting stock for 8-12% less than you, THAT's huge, and it's d*mn hard to compete. Sadly, that bookstore, after 45 years in business, closed this summer.
Also before you complain about costs, think about what independent media places (records & books) tend to offer; people who love their product, are knowledgeable about it, and MOST importantly, they support small presses/publishers/labels than the uber stores won't touch (including Target by the way, not just Wal-mart)
As independent record and book stored closes, so do the many small presses & labels. The store I worked at bought some great books from indie pubs, many of those are now out of business since Target, Wal-Mart and the like won't even talk to them. Those books are no longer available and those people lost their jobs.
Seriously, thing hard about where you buy things. Yes, I understand $2-3 more is a lot to some people, however, you are ultimately reducing your the choices and varieties of the music you hear and books you read. Sometimes being a consumer involves more than just the price of an item.
My 2 cents
'The unexamined life is not worth living' - Socrates
Hello Mr Pot, I'm Mr Kettle. By the way, I couldn't help noticing that you're black...
Telling people that anyone who disagrees with you and attacks you is a troll after you post a comment full of attacks - attacks on the record industry, attacks on Wal-Mart, attacks on its staff, attacks on people who buy the music that it stocks, attacks on independent music stores - is a bit rich.
Let moderators decide for themselves how the comment should be moderated. If I've noticed anything in six plus years of reading Slashdot it's that people with mod points aren't shy of moderating down even the slightest personal insult.
In the meantime though, I suggest you learn to appreciate a few things, including the fact that Wal-Mart does just fine selling CDs you don't want to buy, that other people have different tastes to you and that's not a crime, and that independent stores sell CDs for $16 because that's what they need to do to survive.
"Accept that some days you are the pigeon, and some days you are the statue." - David Brent, Wernham Hogg
To do business with Wal-Mart is to invite death."
I think I saw it in a Wall Street Journal article at some point...
The World Wide Web is dying. Soon, we shall have only the Internet.
These numbers are interesting in many respects. First the artist royalties seem awfully high. Are these assuming the top artists that are selling millions of albums? Marketing and promotion. . . Where does this go? Sure I see posters up at record stores, and they supply cds for free to radio stations etc, and producing music videos that are grossly overpriced and never played (at least I've never seen music videos played on MTV anymore). But even then thats not that much. Not enough to justify that sort of price overhead.
Then we get to the root of the problem. Walmart sells only the top 5000 cds or so. Seems logical enough for them. They ask the question of why the top 5000 cds are costing as much as the less popular cds. Its a valid question. Most every other product sold comes with volume discounts. Shouldn't the overhead for a cd be far less when you're selling 20 million copies of an album? Wouldn't that justify a smaller price?
Then of course we get indie record labels who are selling maybe 20,000 albums selling them to retailers for $10 a piece. Somehow without all the savings accrued by selling tens of millions of albums they're able to make the product cheaper. Its all highly entertaining.
My theory behind it all goes if Walmart pushes to lower prices why not. Hit the industry where it counts and prevent them from gouging the customers. The industry needs walmart. A lot of people buy their cds there because (surprise surprise) they're cheap. Many of these people are willing to pay $10 or $12 for a cd, but when asked to pay $16 they might say "nah, I'll just download it for free".
So the "evil" walmart corporation (whom does more good for this country then most every other group in the nation combined like it or not) is simply fighting to lower prices for the rest of us. Regardless of what you think of the store, they offer many of the same products for far less then other stores. Sure some stores go out of business because of them, but why should I care? As long as I can still buy stuff cheaply I'm happy.
Phil
OK, everyone, read the parent post where it says:
They pull in over $60 BILLION dollars per quarter and $2 billion of that is PROFIT
Now, while 2 billion bucks is a load of cash, 58 billion was spent in search of it. That's a margin of only 3.3%. It is NOT a profit of 33% as a post farther up claims with the illustration of a $12 CD being sold at $16. Walmart makes all of its money on razor thin margins. Yes, 3.3% is razor thin. Compare to, say, Intel, who pulls in a whopping 22.7% profit margin. Now THAT'S a huge margin of profit. Not Walmart and their piddly 3.3%, nevermind how many billions that 3.3% adds up to. Say what you want about the monolithic nature of Walmart and their heavy handed tactics with supplies but you cannot knock it on gouging or otherwise extraordinary profits.
That $15.99 quoted is 8.90 GBP according to XE.com's converter. Clearly our CDs are better quality than yours? No?
That $9.72 quoted as Wal-mart's price equals 5.41 GBP. At that price I for one would be buying lots of CDs, but all you can get for that price in the UK is the broken stuff in the remainder bin.
Differential pricing and price pointing are the scourge of modern retailing. I'd love to see Asda (UK arm of Wal-mart) take on the BPI in this way, but I fear it would have consequences for the independent record stores that still exist, not to mention the second-hand record stores.
When I think of the music industry these days I think of King Canute (that one who thought he could hold back the sea by just sticking out his hand and shouting stop).
He got wet.
(This is why you never see those 'explicit lyrics warning' stickers at Wal Mart -- they just don't give you a choice and force their censorship on you without your knowledge or consent.)
Apparently, Wal-Mart is doing just fine with these CDs on their shelves. It seems that theer is a large enough market for these censored CDs that they turn a profit on them. That's all well and good.. but if you're not happy with it, don't shop there. Simple as that. Don't complain about a company because they do something you don't like. Voice your opinion by disposing of your cash reserves elsewhere.
What is your penile percentile?
Isn't it more likely that those sales will occur elsewhere?
You are not alone. This is not normal. None of this is normal.
If WalMart doesn't stock an extremely wide range of music, it will not be taken seriously as a place to get music.
Have you ever lived near a Wal-Mart? It's NEVER stocked a wide range of music. It's never stocked a wide range of anything. It sells anyway because Wal-Mart (a) is everywhere, (b) is sells what's most popular, and (c) what it does sell, it sells cheaper than anyplace else, including Internet retailers.
Remember, the key word in "popular music" is "popular". So what if it's not a wide selection? If 95% of all shoppers save money on the 5% of all CDs Wal-Mart stocks, then thay will. The other 5% of all shoppers don't HAVE to take Wal-Mart seriously as a music store. Wal-Mart, in many non-urban parts of the US, is nearly the only place you can go to buy CDs anyhow, and if there is another music store in town it's vastly overpriced by comparison.
Don't think like a music connoisseur, think like a capitalist. The 95% that buys what's popular is all that matters to Wal-Mart's bottom line, and it's the same 95% that the record labels have built their entire industry around. If Wal-Marts across the country refuse to stock a label's new CDs, then those record companies lose a big chunk of their business. Certainly not enough to cripple them, but enough to hurt their quarterly sales. Wal-Mart has played this game of Chicken plenty of times before, and it's always the other guy that blinks.
When are /.ers going to realise: the purpose of commercial entities is not to spread knowledge of music, but to make profit.
There are two perfectly valid business strategies to do this:
Target a consumer segment that wants to buy a wide selection of music, which necessarily cannot be limited to the current top radioplay/chart list.
To do this, you have to hold a much higher level of stock. To do this profitably, you have to have a higher gross margin to maintain a livable net margin.
The trouble is, unless you can carry a truly huge stock and shift it very fast (Hello, Amazon), you won't be doing the volume to have the buying power with the distributors. Therefore you must add your higher margin to higher costs. Result: high consumer prices.
Target a consumer segment that only cares about what's in the charts/on the radio.
This is a much bigger segment, and it's a much smaller set of product. Therefore, you can be much more efficient with your supply chain processes, you'll need less real estate for shelving, and you'll shift more volume so can negotiate more robustly with suppliers. You can therefore offer lower prices and still make respectable net margin as your costs are so low.
Both of these strategies are viable, and are only somewhat competitive. You're a consumer who likes non-chart music, so do you go to WalMart to find it? No, of course not. The existence or otherwise of WalMart is entirely irrelevant to your music buying habits. You worry about all those teenagers who only go to WM only finding chart music? They shop where their needs are met - if they wanted anything else, they'd go elsewhere.
But I think the biggest trap you've fallen into is the High Fidelity one - mistaking selling CDs for loving music. If you're a retailer who does it because you love the music and don't have a profit motive, then you have a hobby, my friend, not a business.
Amazon are very smart about this. They explicitly do not target people who love *read* books, but those who love to *buy* them.
Wal-Mart don't care about the music. It's just business - they supply a need profitably to provide a maximised return to their owners. This isn't A Bad and Evil Thing: their owners (ie the stockholders) legally require them to behave like this.
And this is the case for pretty much everyone involved: The people who press the CDs, the people who design the covers, the people who ship the CDs, the people who provide catering to the studios - everyone. Even among professional musicians, the strongest desire of all is to be paid, or didn't you notice the existence of the Musician's Union...
The only thing you can accurately describe as "Scotch" is a sticky tape made by 3M. And it's
I guess you aren't one of the people who miss the days when Levi's were the best jeans you could buy? Wal-Mart forced them to "cut the fat" so they would be able to offer the product at a reduced price every year. From jeans which could hold together while being pulled by two horses, to jeans no tougher than three ply tissues.
The consumer quest for rock bottom prices has also lead to rock bottom quality.
You don't mind that Wal-mart is essentially a sweat shop that pays below average wages? That they lower the standard of living in the neighbourhoods they are set up in? That it's up to the government or the spouces benefits package to make up the difference? You may save up front, but at what cost? Every consumer that shops there is contributing to the problem.
People get up in arms when workers are exploited overseas, but don't care when it happens to some extent in their own backyard as long as it saves them $0.50 on toiletpaper?
You're right, no one has to shop there if they don't want to. I don't like what Wal-Mart stands for; I think they lead to a social net loss. So I don't shop there. And I discourage others from doing so as well.
Man, this is insane.
If you don't like what they're selling at Wal-Mart, DO NOT BUY IT. If you don't like their pricing, DO NOT SHOP THERE. If you don't like their attitude, the color of the store, their stance on not carrying lesbian porn, DO NOT FREQUENT THEIR ESTABLISHMENT.
All I ever hear about Wal-Mart anymore is how damned evil they are and how the store sucks and their music is unfairly censored and blahblahblah. If it's so damned bad, why are they making money hand over fist?
Frankly, I love what they've done for supply chain management, I love how they slap their suppliers into line, their prices are incredible, watching white trash is funny as hell, and I don't buy music there because I want to hear Jay-Z say 'fuck.'
Anybody else actually have a problem with Wal-Mart they can express intelligently?
Maybe so. But they've also changed the marketplace so that lowest manufacturing cost is the only consideration for success. Consequently, they've created a gargantuan flood of imports that we've paid for with IOUs. Low inflation over the last 15 years has been bought on loan.
Since with current demographic trends we're never going to pay those IOUs off at current values, there's probably going to be a huge surge of inflation in the future while the government prints money to devalue our foreign debt. So really what WalMart is doing is just pushing the inevitable inflation into the future, where it's going to hit us all at once.
It's like they've handed us a credit card, and we as a nation have become lazy and quit working to earn the stuff we buy. We just keep charging more stuff on the credit card.
It seems that theer is a large enough market for these censored CDs that they turn a profit on them.
I doubt that. If these CDs were actually upfront about being censored, that would be fine, but they're not.
"We returned the General to El Salvador, or maybe Guatemala, it's difficult to tell from 10,000 feet"
Sometimes being a consumer involves more than just the price of an item.
I imagine that if you could have received the same price breaks as B&N then you would have jumped at the opportunity. Then you would sell them at a lower cost to the consumer.
Assuming that's true, then you are doing what you counsel against. As a bookstore you are a consumer buying from distributers, but you always look for the better deals, just as the end consumer does.
The next argument usually made is, "We would have to just to survive," which is also made by the end consumer. If I can buy the same product for less, is it in my best interest to buy it for more? The store has to make the same decision, and the result is the same - it's not in the store's best interest to buy from a higher cost distributer, and it's not in the consumer's best interest to buy from a higher cost store.
This is capitalism. It's nice to believe in a rosy utopia where everyone gets what they want, but the reality is that our economy does not support that model.
To paraphrase the GPL people, "If you don't like it, invent your own currency and enforce your own economic model. You have the tools."
-Adam
Um you're right about everything about the fast food, theres no loss leaders in fast food. I used to order stuff for mcdonalds 3 times a week. Our cost for a hamburger was 10 cents. Our cost for a cheeseburger was like 14. Cost for a big mac was I think maybe 29 cents. The most expensive thing was the filet o fish...a whole 60 cents. Trust me there are no loss leaders at mcdonalds.
Seems more like Feudalism to me. Big king in far-off castle, store manager as vassel, serfs working the land (that only the king actually owns any of). Yep, Walmarts in small towns are fiefdoms.
"Somebody has to do something. It's just incredibly pathetic it has to be us."
--- Jerry Garcia
1. The grand parent accused the OP of being a selfish, elitist prick, not a criminal. And being a selfish, elitist prick is not a crime.
:)
2. The OP has offered very little by way of evidence of being an intelligent person who makes rational arguments. "I don't like the music sold at walmart, therefore it is all crap and they must be lying about the fact that 1 in 5 CDs are sold at walmart"
This guy is best ignored... but insulting him is probably more satisfying
If you want above-average wages, go to college. Start a business. DO something.
If you're just going to show up to work when you're told and do a job *ANYONE* can do, you deserve the crap pay you're getting. That's life.
And, Americans agree with me, based on how they vote with their wallets.
paintball
Those outsourced factory jobs everyone is blaming on Bush? A goodly number of them can actually be laid at the feet of Wal-Mart and it's predatory practices. Look what they did to Levi-Strauss, and L-S bent over and took it to gain acess to Wal-Mart.
This story about Wal-mart frightens me greatly, and it's just one of many.
My biggest problem w/ Wal-Mart is that they don't pay their employees enough and don't give them health care, making them a burden on the state and the taxpayers and thus me. I don't want to have to subsidize Wal-Mart's low-prices by having my tax dollars pay for a Wal-Mart employee's over-priced trip to the emergency room for something that if they had health care they could have taken care of at a doctor's office or clinic.
Dude, I think I can see my house from here.
Wal-Mart's markup on stuff other than CDs ranges from 30% - 50%.
Where are you getting your numbers?
33% is most certainly not gouging.
I think the above statement is a misconception. Who is to decide what numbers are "gouging" and what numbers aren't? Why are we even talking about "price gouging" regarding such a luxury item?
33% is wildly high for some businesses, and very low for others.
Buying from a major label is sort of like buying name-brand clothes. You aren't really getting something better, you're just getting something more popular. The music is good because the radio and all the clubs overplay it, not in spite of that fact. Serious musicians don't care about that, but to the average person (myself included) the pop music is kinda catchy and gets stuck in my head. There are many similar examples, like how people will pay a lot for diamonds, but if de Beers flooded the market nobody would want diamonds anymore.
Price is not some arbitrary value which should be manipulated. It's the indicator of the current supply conditions and current demand conditions. A hotel room during a disaster (like a flood or hurricane) is highly demanded, but the supply is relatively low. When the price rises, it forces a more efficient use of the resources available. Those in need of space will be more likely to stay with friends if they can, leaving the hotel space for those more in need. Large families who might normally reserve two rooms might get one instead, leaving a room open for another family. Families might get the necessary portions of their house fixed and move back faster (again leaving room for another family), without waiting for their house to be restored to perfect condition.
Of course, all the efficiencies mentioned above would be called "price gouging". When the government steps in and prevents the price from rising naturally, it becomes a race to see who can reserve hotel rooms the fastest, and creates a shortage. Then, the families most in need might be left on the streets while families who could be staying with friends are enjoying a two-bedroom luxury suite.
Social scientists are inspired by theories; scientists are humbled by facts.