The Man Who Said No to Wal-Mart

Charles Fishman, senior writer for Fast Company magazine has recently published a book entitled The Man Who Said No To Wal-mart. It's an excellent book (Yes, I've read it) that talks about the intersection of making good stuff, the commodization of products, and the changing world that we work in; not exactly high tech, but tech nonetheless. Every year, thousands of executives venture to Bentonville, Arkansas, hoping to get their products onto the shelves of the world's biggest retailer. But Jim Wier wanted Wal-Mart to stop selling his Snapper mowers.What struck Jim Wier first, as he entered the Wal-Mart vice president's office, was the seating area for visitors. "It was just some lawn chairs that some other peddler had left behind as samples." The vice president's office was furnished with a folding lawn chair and a chaise lounge.

And so Wier, the CEO of lawn-equipment maker Simplicity, dressed in a suit, took a seat on the chaise lounge. "I sat forward, of course, with my legs off to the side. If you've ever sat in a lawn chair, well, they are lower than regular chairs. And I was on the chaise. It was a bit intimidating. It was uncomfortable, and it was going to be an uncomfortable meeting."

It was a Wal-Mart moment that couldn't be scripted, or perhaps even imagined. A vice president responsible for billions of dollars' worth of business in the largest company in history has his visitors sit in mismatched, cast-off lawn chairs that Wal-Mart quite likely never had to pay for.

The vice president had a bigger surprise for Wier, though. Wal-Mart not only wanted to keep selling his lawn mowers, it wanted to sell lots more of them. Wal-Mart wanted to sell mowers nose-to-nose against Home Depot and Lowe's.

"Usually," says Wier, "I don't perspire easily." But perched on the edge of his chaise, "I felt my arms getting drippy."

Wier took a breath and said, "Let me tell you why it doesn't work."

Tens of thousands of executives make the pilgrimage to northwest Arkansas every year to woo Wal-Mart, marshaling whatever arguments, data, samples, and pure persuasive power they have in the hope of an order for their products, or an increase in their current order. Almost no matter what you're selling, the gravitational force of Wal-Mart's 3,811 U.S. "doorways" is irresistible. Very few people fly into Northwest Arkansas Regional Airport thinking about telling Wal-Mart no, or no more.

In 2002, Jim Wier's company, Simplicity, was buying Snapper, a complementary company with a 50-year heritage of making high-quality residential and commercial lawn equipment. Wier had studied his new acquisition enough to conclude that continuing to sell Snapper mowers through Wal-Mart stores was, as he put it, "incompatible with our strategy. And I felt I owed them a visit to tell them why we weren't going to continue to sell to them."

Selling Snapper lawn mowers at Wal-Mart wasn't just incompatible with Snapper's future -- Wier thought it was hazardous to Snapper's health. Snapper is known in the outdoor-equipment business not for huge volume but for quality, reliability, durability. A well-maintained Snapper lawn mower will last decades; many customers buy the mowers as adults because their fathers used them when they were kids. But Snapper lawn mowers are not cheap, any more than a Viking range is cheap. The value isn't in the price, it's in the performance and the longevity.

You can buy a lawn mower at Wal-Mart for $99.96, and depending on the size and location of the store, there are slightly better models for every additional $20 bill you're willing to put down -- priced at $122, $138, $154, $163, and $188. That's six models of lawn mowers below $200. Mind you, in some Wal-Marts you literally cannot see what you are buying; there are no display models, just lawn mowers in huge cardboard boxes.

The least expensive Snapper lawn mower -- a 19-inch push mower with a 5.5-horsepower engine -- sells for $349.99 at full list price. Even finding it discounted to $299, you can buy two or three lawn mowers at Wal-Mart for the cost of a single Snapper.

If you know nothing about maintaining a mower, Wal-Mart has helped make that ignorance irrelevant: At even $138, the lawn mowers at Wal-Mart are cheap enough to be disposable. Use one for a season, and if you can't start it the next spring (Wal-Mart won't help you out with that), put it at the curb and buy another one. That kind of pricing changes not just the economics at the low end of the lawn-mower market, it changes expectations of customers throughout the market. Why would you buy a walk-behind mower from Snapper that costs $519? What could it possibly have to justify spending $300 or $400 more?

That's the question that motivated Jim Wier to stop doing business with Wal-Mart. Wier is too judicious to describe it this way, but he looked into a future of supplying lawn mowers and snow blowers to Wal-Mart and saw a whirlpool of lower prices, collapsing profitability, offshore manufacturing, and the gradual but irresistible corrosion of the very qualities for which Snapper was known. Jim Wier looked into the future and saw a death spiral.

Wier had two things going for him: First, he had another way to get his lawn mowers to customers -- a well-established network of independent lawn-equipment dealers that accounted for 80% of Snapper's sales. And Wier had the courage, the foresight, to take an unblinking view of where his Wal-Mart business was heading -- not in year 3, or year 4, but year 10.

Wier traveled to Bentonville with a firm grasp of the values of Snapper, the dynamics of the lawn-mower business, the needs of the dealers, the needs of the Snapper customer, and the needs of the Wal-Mart customer. He was not dazzled by the tens of millions of dollars' worth of lawn mowers Wal-Mart was already selling for Snapper; he was not deluded about his ability to beat Wal-Mart at its own game, to somehow resist the price pressure. He was not imagining that he could take the sales now and figure out the profits later.

Jim Wier believed that Snapper's health -- indeed, its very long-term survival -- required that it not do business with Wal-Mart.



Every Snapper lawn mower sold anywhere in the world comes from a factory in McDonough, Georgia, a small town 30 minutes southeast of Atlanta. Coils of raw steel arrive on flatbed trucks every day at the old, nondescript building; brand-new fire-engine-red lawn mowers leave every day, loaded in 18-wheelers. The facility looks undistinguished, but it is energetically trying to defy the conventional wisdom about manufacturing in the global economy.

The Snapper factory has had an invigorating decade. Ten years ago, it produced about 40 models of mowers, leaf blowers, and snow blowers; now it makes 145. Today, robots do the welding, lasers cut parts, and computers control the steel-stamping presses. Productivity is three times what it was 10 years ago, and the number of people working here, 650, is half what it was.

Indeed, the productivity of every factory worker is measured "every hour, every day, every month, every year," says Snapper president Shane Sumners, who walks the 10.5-acre factory floor with comfort and familiarity. "And everybody's performance is posted, publicly, every day for everyone to see." It's a lot like Wal-Mart -- which measures the number of items every checkout clerk scans every hour. Some of Snapper's dramatic productivity improvements, in fact, seem to come almost directly from the Wal-Mart playbook. These days, the Snapper factory operates in Wal-Mart time. It must, because it operates in Wal-Mart's ecosystem.

Ten years ago, at about the time Sumners came on board, Snapper had 52 regional distributors. It uses no distributors now -- the company runs four regional warehouses of its own and sells directly to 10,000 independent dealerships. Ten years ago, in part because of the complexity of the middleman distribution system, Snapper carried a huge quantity of inventory. It paid to manufacture and ship thousands of lawn mowers -- worth tens of millions of dollars -- without quite knowing when they would be sold. Now planners come up with an ideal level of inventory for every model, for every region of the country, based on things like historic demand and the weather. The goal is to make sure every customer can get the mower he wants -- while making absolutely the smallest number of lawn mowers.

Production at the Snapper factory is rescheduled every week, according to the pace at which mowers sell. A computer juggles work assignments and balances the various parts of the assembly line. The main manufacturing line for Snapper's entry-level walk-behind mowers -- with 28 people -- was recently charged with producing 265 lawn mowers in an eight-hour shift. The group hit the mark exactly. That's a new lawn mower, from loose parts to sealed box, every 109 seconds. "It's all a matter of seconds," says Sumners.

It's not hard to make a cheap lawn mower. A cheap lawn mower feels flimsy, sounds louder than it has to, and even when new, requires a mysterious, frustrating combination of choke, priming, and pulling to start. The cutting deck of a cheap mower is stamped from thin sheet metal. Making a high-quality lawn mower -- even in 109 seconds -- requires attention to detail and constant improvement, which seems surprising for a machine that doesn't evolve that much.

All Snapper machines, from the simplest walk-behind to the most elaborate riding mower, are painted one color: what Shane Sumners calls "Snapper red." In the factory, the finished chassis of riding mowers coast along slowly, dangling from an overhead conveyor as they approach a 20-foot-long pool of red paint. The conveyor track dips low, and the mowers glide down into the pool and completely disappear beneath the surface, then rise back up, gleaming red, before heading for a pass through a curing oven.

It's not quite as simple as dip and bake, however. Each mower is electrically grounded as it hangs from the overhead conveyor, and a slight positive electrical charge runs through the 16,000-gallon trench of paint. "So the paint is attracted to the metal and builds up on the parts and sticks very effectively and evenly," says Sumners. The process is monitored every hour -- from the speed of the conveyor and the temperature of the ovens to the pH of the paint -- along 115 parameters. "If you control the process," says Sumners, "you will get a good paint job."

Snapper technicians start every riding mower before it leaves the McDonough plant. At the "hot start" station, a man wearing ear protectors squirts gas into the fuel tank and oil into the crankcase, pulls the starter cord, and brings the machine to life. He runs through all the gears, checks speed, engine performance, the mounting of the seat. The engine is given just enough fuel for the "run in." If the mower passes all the tests, the man sucks the oil back out and sends the mower on to be boxed.

As Sumners watches, one of the riding mowers takes two pulls to start, then comes to life with a rough growl. In the blink of an eye, the technician shuts it down. "Did you hear how that sounded?" asks Sumners. "It's not right. That's a bad one." The mower is shunted off to be inspected and properly tuned if possible. "If we didn't," says Sumners, "that mower would have gone to a customer."

The Snapper factory started making riding mowers in 1951. It is unadorned and old, but it is old in the sense of solidity and use. There is nothing tired about it. More significant, there is nothing sentimental about it. This factory isn't here out of some misplaced sense of economic loyalty to U.S. manufacturing. It's here because it makes Snapper-quality lawn mowers at a competitive price.

Snapper's factory hums with discipline and focus and urgency. Even with no products at Wal-Mart, a company like Snapper has to compete psychologically, has to keep the price gap between the big-box lawn mowers and its lawn mowers rational. If it did not, its potential slice of the market would get smaller and smaller.

Sumners has to spur his factory on with the same tirelessness as if it were supplying Wal-Mart -- the efficiency of every factory worker measured every hour of every day -- because Wal-Mart sets the pace, even if you're not working for them.



Jim Wier is 62 years old, with a youthful twinkle, despite a thatch of white hair. He is a solidly built man who dresses casually. He is comfortable with himself. Wier, who until the summer of 2005 ran a group of lawn-equipment businesses that approach half a billion dollars a year in sales, is confident, direct, and unprepossessing. He mows his own lawn. "I don't want to hire a service," he says. "I still love to cut my grass."

Wier is much like Snapper's customers. "When we do surveys of our customers, they like to cut their grass. And they want a good piece of equipment to do it. We're designed to give you the best quality of cut. We have full rollers on the riding mowers, to give that nice striped look on your grass, like on the baseball fields. It makes you feel proud of the home you own. Proud of your lawn. The neighbors walk by, they say, 'Look how good the yard looks.' "

Wier doesn't really think that a $99 lawn mower from Wal-Mart and Snapper's lawn mowers are the same product any more than a cup of 50-cent vending-machine coffee is the same as a Starbucks nonfat venti latte. "We're not obsessed with volume," says Wier. "We're obsessed with having differentiated, high-end, quality products." Wier wants them sold -- he thinks they must be sold -- at a store where the staff is eager to explain the virtues of various models, where they understand the equipment, can teach customers how to use a mower, can service it when something goes wrong. Wier wants customers who want that kind of help -- customers who are unlikely to be happy buying a lawn mower at Wal-Mart, and who might connect a bum experience doing so not with Wal-Mart but with Snapper.

And so in October 2002, with a colleague, Wier kept an appointment with a merchandise vice president for Wal-Mart's outdoor-product category.

"The whole visit to Wal-Mart headquarters is a great experience," says Wier. It really is a pilgrimage to the center of the retail universe. "It's so crowded, you have to drive around, waiting for a parking space, you have to follow someone who is leaving, walking back to their car, and get their spot. Then you go inside this building, you register for your appointment, they give you a badge, and then you wait in the pews with the rest of the peddlers, the guy with the bras draped over his shoulder."

Normally, meetings between Wal-Mart buyers and people from supplier companies take place in the legendary meeting rooms just off the vendor lobby. These cubicles are simple to the point of barren -- a table and four chairs, and 30 minutes to make your case. "It's a little like going to see the principal, really," says Wier.

In this case, Wier says, both he and the Wal-Mart managers "had a feeling that this would be an important meeting." So Wier and his colleague were scheduled to visit the vice president in his office. Sitting on lawn chairs.

"The meeting started with the vice president of the category saying how it was clear that Lowe's was going to build their outdoor power-equipment business with the Cub Cadet brand, and how Home Depot was going to build theirs with John Deere," says Wier. "Wal-Mart wanted to build their outdoor power-equipment business around the Snapper brand. Were we prepared to go large?"

Talk about coming to the table with different agendas. Wier was in Bentonville to pull his mowers from Wal-Mart's stores. The vice president was offering a greater temptation: Let's join hands and go head-to-head against the home-improvement superstores.

Which is when Wier said no.

"As I look at the three years Snapper has been with you," he told the vice president, "every year the price has come down. Every year the content of the product has gone up. We're at a position where, first, it's still priced where it doesn't meet the needs of your clientele. For Wal-Mart, it's still too high-priced. I think you'd agree with that.

"Now, at the price I'm selling to you today, I'm not making any money on it. And if we do what you want next year, I'll lose money. I could do that and not go out of business. But we have this independent-dealer channel. And 80% of our business is over here with them. And I can't put them at a competitive disadvantage. If I do that, I lose everything. So this just isn't a compatible fit."

The Wal-Mart vice president responded with strategy and argument. Snapper is the sort of high-quality nameplate, like Levi Strauss, that Wal-Mart hopes can ultimately make it more Target-like. He suggested that Snapper find a lower-cost contract manufacturer. He suggested producing a separate, lesser-quality line with the Snapper nameplate just for Wal-Mart. Just like Levi did.

"My response was, we would take a look at that," says Wier. "The reason I gave that response was, it was a legitimate question. In my own mind, I knew where I'd go with that" -- no thanks -- "but at that kind of meeting you at least have to be willing to say, I'll investigate." And that was it. "The tone at the end was, We're not going forward as a supplier."

No lightning bolt struck. Except that Snapper instantly gave up almost 20% of its business. "But when we told the dealers that they would no longer find Snapper in Wal-Mart, they were very pleased with that decision. And I think we got most of that business back by winning the hearts of the dealers."

Snapper was successfully integrated into Simplicity, which in 2004 was itself bought by Briggs & Stratton, the company that makes many of the engines in Snapper and Simplicity mowers. Simplicity and Snapper operate as independent divisions, and Wier remained CEO of both until last summer, when he resigned to join the private equity firm Kohlberg & Co. In McDonough, business is strong. Shane Sumners plans to add a second assembly line for both walk-behind and riding mowers.

One serious hazard to Wier's strategy is that independent lawn-equipment dealers face all the same pressures that have killed, for instance, many independent hardware stores and toy stores. "That is a legitimate question and a legitimate concern," says Wier. "I think we have a part in that outcome. Can Snapper, as a major supplier, continue to supply [the independents] with great product, and a product different than you can buy at Wal-Mart?"

Wier says, "I'm probably pro-Wal-Mart. I'm certainly not anti-Wal-Mart. I believe Wal-Mart has done a great service to the country in many ways. They offer reasonably good product at very good prices, and they've streamlined the entire distribution system. And it may be that along the way, they've driven some people out of business who shouldn't have been driven out of business." Wier wasn't going to let that happen to Snapper.

Wier had determined to lead Snapper to focus on quality, and through quality, on cachet. Not every car is a Honda Accord or a Toyota Camry; there is more than enough business to support Audi and BMW and Lexus. And so it is with lawn mowers, Wier hoped. Still, perhaps the most remarkable thing is that the Wal-Mart effect is so pervasive that it sets the metabolism even of companies that purposefully do no business with Wal-Mart.

And the power and allure of Wal-Mart is such that even Jim Wier, the man who said no to Wal-Mart, a man who knows all the reasons why that was the right decision, has slivers of doubt.

"I could go to my grave, and my tombstone could say, 'Here lies the dumbest CEO ever to live. He chose not to sell to Wal-Mart.'"

Charles Fishman is a Fast Company senior writer and the author of, "The Wal-Mart Effect: How the World's Most Powerful Company Really Works -- And How It's Transforming the American Economy." See www.walmarteffectbook.com for more information.

From THE WAL-MART EFFECT by Charles Fishman. Reprinted by arrangement with The Penguin Press, a member of Penguin Group (USA), Inc. Copyright (c) Charles Fishman, 2006. Charles is a senior writer for Fast Company magazine.

Comments

Obvious.

[tpgp]

Walmart sells cheap crap - if your company does not sell cheap crap, you can't sell at walmart.

Oh - and the quote: same product any more than a cup of 50-cent vending-machine coffee is the same as a Starbucks nonfat venti latte.

Dreadful analogy - the 50-cent vending machine coffee is crap, the $3.50 starbucks latte is crap.

Re:Obvious.

[sammeal]

"Walmart sells cheap crap - if your company does not sell cheap crap, you can't sell at walmart"

Wal-Mart sells a huge variety of well-known well-regarded quality brands.... including Apple and Sony. If Apple and Sony are crap, than EVERY SINGLE PRODUCT EVERYWHERE is crap.

Re:Obvious.

[Profane MuthaFucka]

The other side of the coin is that the low prices at Wal Mart are subsidized by the rest of us.

For example, they don't provide proper health insurance to their employees which forces many of them to get government medical insurance assistance, otherwise known as Medicaid.

Wal Mart also drives competitors out of business, reducing the diversity of choices in a community. Some places if you want to work, you work at Wal Mart. You want to shop? Wal Mart is practically your only choice.

Wal Mart drives prices lower and lower, forcing suppliers to move their production offshore. This means that we're losing manufacturing capability in this country, and we're losing the manufacturing jobs.

Wal Mart hurts our port security too. They are currently pushing hard against adopting a policy of scanning every single cargo container entering our ports, because that would screw up their delivery system. Basically they are ready to trade off some of our safety for the sake of their profits.

Avoid Wal Mart whenever you can.

Re:Obvious.

[sqlrob]

And if you RTFA, companies can (and do) give lesser quality products under the same label to Wal-Mart.

IIRC, the same is true of some of the stuff at Best Buy as well.

Re:Obvious.

[everphilski]

Dreadful analogy - the 50-cent vending machine coffee is crap, the $3.50 starbucks latte is crap.

Excellent analogy. I'd rather have 7 cups of generic coffee than 1 cup of super expensive coffee that tastes a little better than the generic.

I shop at WalMart. For the basic everyday items (food, toiletries, etc.) generic items at decent prices. However for something that is a long-term investment - computers, furniture, clothing, etc - we go for quality. Its a balance.

This guy is nothing new. I read the article in Fast Company a few months ago. He wasn't willing to bend and neither was Walmart, so the deal was cut off. Deals are called off all the time...

Re:Obvious.

[CastrTroy]

For example, they don't provide proper health insurance to their employees which forces many of them to get government medical insurance assistance, otherwise known as Medicaid.

Why should it be the responsiblity of corporations, who's only concern is to it's shareholders, and the almighty dollar, to pay for health insurance?

Re:Obvious.

[StarvingSE]

Mom and pop stores don't suck, they just have to sell at prices higher than walmart. They don't have 3000 stores or the push-around power that walmart has due to its market share.

What I do get at the ma and pa store is a friendly face and great service. They usually are very knowledgable about the product they sell, and many times are willing to go the extra length if I have any problems at all with my purchase.

The last time I went into a walmart (with a friend, I never buy there and avoid it like the plague), the place was dirty, shelves were disorganized, and no one was willing to help other than to point down an isle. Price isn't always more important, although I believe that through advertising the american public is being brainwashed into thinking it is.

Beside, on many items, the reduced price at walmart isn't all that much lower than at other retailers. And as previous posts and TFA points out, a lot of it is brand-named junk anyway.

Re:Obvious.

[homer_ca]

Yeah,and that PS2 cost $149.99, the same as any other store that sells PS2s. The only difference is you had that great Walmart shopping experience.

Re:Obvious.

[StarvingSE]

And comments like this are what is wrong with our country. Corporations and their shareholders would not be making any money at all if not for their employees. Human resourcess should be a company's most important resource. Health care for employees means that the company cares about the welfare of their employees.

Also, I hear that productivity goes waaaay down when employees are sick ;)

Re:Obvious.

[Orangejesus]

The last 5 things I've bought from sony have been junk that have either not worked right or broken within a year. Sony once may have produced quality products but today they produce cheap junk that sells on the sony name.

Re:Obvious.

[Marxist Hacker 42]

This guy is nothing new. I read the article in Fast Company a few months ago. He wasn't willing to bend and neither was Walmart, so the deal was cut off. Deals are called off all the time...

I stopped shopping at Wal-Mart when I realized this guy was rare- that EVERY freakin' thing in Wal-Mart that wasn't produce was made someplace other than America. The way I look at it, just like in warfare, in capitalism there are Patriots, and there are Traitors- and Wal-Mart is effectively the economic version of the Chinese Secret Police.

Re:Obvious.

[acvh]

the linkage of health insurance to employment is one of the great wrongs in US history. why SHOULD an employer be expected to subsidize health care? I would prefer to see employers pay wages that allowed employees to make their own health care decisions, rather than shop for the lowest cost health care plan they can get away with and channel their employees into substandard, assembly line managed care plans.

if my employer would just give me as salary the money they pay for my health insurance I could go out and get a more appropriate level of coverage for my family. since they don't do that, the only economically sound decision I can make is to use what they provide.

Re:Obvious.

[norkakn]

No, they'd just get a lot sicker before they went to the ER where the taxpayers would have to foot the bill anyways. It's cheaper to do public healthcare.

Re:Obvious.

[Helmholtz Coil]

I'm sure I'll get flamed for this, but...depending on the setting, Mom and Pop stores aren't always a better choice for the community than a Walmart.

Where I grew up (very small town, extremely isolated in the middle of nowhere), the local stores could gouge you stupid because it just wasn't worth a 90 minute drive to the nearest other town for better prices on groceries, or a five hour drive for better prices on appliances to the nearest "big city". Granted being in the middle of nowhere meant that the local stores had to contend with high supplier costs, but somehow $8 for 2 litres of Pepsi still seems excessive. The owners were the first to cheerfully admit that they were getting filthy rich off what amounted to a monopoly in this one-horse town.

Then along came Walmart in the next town over. Suddenly the local outfits found themselves having to be competitive. It was still a 90 minute drive so they could charge a slight premium for convenience, but they couldn't get away with the markups they used to enjoy. Today the local grocery store still enjoys a monopoly of sorts in the town, and was able to open a brand new megastore. They just can't charge whatever they feel like anymore.

I'm not saying Walmart's a saint, I'm well aware of the fact that they aren't. I'm just suggesting that it's not always the bad guy, nor is the local non-chain always the good guy. Ok, let the outraged flames commence. :)

Re:Obvious.

[Kevin DeGraaf]

who's only concern is to it's shareholders

Ah, my eyes! Somebody stop the pain!

Re:Obvious.

[HairyCanary]

Employers are not merely expected to subsidize health care -- they want to. When shopping for insurance, they get lower prices than you do. A lot lower, probably. If they had to pay you competative wages with everyone else so you could choose your insurance provider, then the cost would be higher -- for you, and then by extension, for them.

Re:Obvious.

[aussersterne]

You sound like a free-market sort, likely to be opposed to "socialism," etc.

So think about this: Wal-mart encourages its employees to go on medicaid and welfare to make ends meet, and has programs and personnel whose roles are specifically to help new sales associates to enroll in these programs so that they can live on Wal-mart wages.

The U.S. however, has no national health for everyone, only for the "needy," which in many cases means Wal-mart employees. So you are spending your tax dollars in spades, and it is going to feed and care for Wal-mart employees, thereby increasing profits for shareholders, yes... who then pay taxes on their capital gains that will go to support these very programs, which continually have to increase as wages are drawn down. And of course, as wages are drawn down, more and more people can only afford to shop at Wal-mart.

IN short, this attitude is little more than robbing Peter to pay Paul, with Wal-mart executives skimming off the top for their salaries and shareholders encouraging a transition to defacto socialism, although an inequitable one where only those who work for certain companies are eligible for government benefits by virtue of their poor pay.

And if you are neither a shareholder nor a shopper at Wal-mart (like myself) then you are merely being forced to subsidize high Wal-mart earnings for its shareholders and low Wal-mart prices for other people who will then have a minor economic advantage over you (because they spend less for the same goods) as all of you gradually lose wealth.

In short, the Wal-mart philosophy is an insidious force in society that gradually reduces everyone who is not a shareholder to poverty, while the shareholders merely tread water as they, too, increasingly subsidize the system to counterbalance the poverty that they impose with their greed (and they have to do so because otherwise crime would skyrocket as people increasingly try to survive). Who really gets rich? Management and China, who is Wal-mart's largest supplier, by far.

Re:Obvious.

[Illbay]

Wal Mart also drives competitors out of business, reducing the diversity of choices in a community.

Have you ever heard the phrase "It's the best thing since sliced bread?"

Do you know the origin?

It comes from the time in the early 20th century, when a "startup company" went into business mass-baking loaves of bread, and PRE-SLICING the loaves, packaging them, and selling them at the grocer.

Although we tend to think of things like this as "progress," in fact there was a GREAT deal of upheaval attached to the advent of "sliced bread."

For one thing, in order for everything to work right in the "mass-baking" process, the large-scale bakeries had to remove a good deal of "quality ingredients" from their recipes. What they wanted was a gluten-free mixture that was uniform in size, shape and consistency--so they wouldn't screw up the bread-slicing machinery.

The old-fashioned neighborhood bakers began to clamor and complain about this new sliced-bread monstrosity. It was putting them out of business, but it was a plainly inferior product!!!

However, the busy housewife in an ever-busier age, began to migrate toward the new-fangled "white bread" product, DESPITE any drawback in quality, because of CONVENIENCE.

Today, you still have lots and lots and lots of "sliced bread" being sold, and yet you still have a persistent market for quality baked goods.

The one does not necessarily preclude the other, IN A FREE SOCIETY.

However, elitist snobs would have that freedom curtailed--"shut down Wal-Mart, only WE know what is best for the average consumer!" Ironic. They're so afraid of a tax-paying, publicly traded entity, and don't mind using the all-crushing power of the government to kill it if possible.

Re:Obvious.

[CastrTroy]

By that logic, it would be cheaper to group the entire country into 1 large group, and have everybody in the country under the same insurance plan. Then, to make it even cheaper, you remove the insurance company, and have a government run insurance plan that takes no profit.

Re:Obvious.

[nelsonal]

Actually they sort of did. During the great depression and into World War 2 they put a cap on salaries to promote full employment and later held it to allow the government to bid for talent. So those sneaky companies figured out that benefits were not covered in the compensation cap and offered benefits to attract better employees. The whole policy is misguided and flows from an earlier monkeying with the free market. Somehow automobile insurance companies are able to spread risk without selling to an entire company, city, or group. Why fundamentally is health insurance so different?

Re:Obvious.

[Pxtl]

That's an unrealistic viewpoint. The fact is that the shareholders run the company. If the CEO is not exploiting opportunities to the fullest, the board will replace him with someone who will. The board is made up of shareholders - big, faceless mutual funds for example.

What this means in the long run is that a publicly traded company will naturally be drawn to maximizing shareholder profits, just as organisms are drawn to reproduce and survive. To expect otherwise is to go against nature.

If you want a publicly run company to be good, you must force it to be good - either by providing incentives to make it good, or consistently enforced deterrents from being bad. Otherwise, an ethical CEO will be replaced by a profitable one. If Wal-mart should be paying for medical insurance, then make a law stating that unskilled-labour businesses like wal-mart should pay for medical insurance Otherwise they won't.

This is why corporate libertarians bewilder me. Deregulation is basically handing the keys to a drunk driver.

Re:Obvious.

[stinerman]

I will agree with you on the following conditions:

1) You can guarantee that everyone who wishes to work will have a job that will enable them to pay for adequate medical care.
2) In the absence of condition #1, you can guarantee that no one will be subject to serious injury, permanent disability, or death because they were unable to pay for health care (in fact this happens quite a bit already).

I understand that you do not wish to pay for health care for people who are simply too lazy to get a job and work like the rest of us, but I don't think you wish to say "fuck you" to everyone who might have had bad luck and got laid-off. In absence of those conditions, you're basically saying "If you can't to pay, you deserve to die." If that is your opinion, then more power to you, but I don't think you'll have much luck getting your views past the front door of Congress or your state legislature.

Supply and demand does not work with health care unless you're allowing for "If you can't pay, you deserve to die". Assume I have a condition that requires expensive medication that I will die without. If my insurance company decides I am no longer profitable, they will increase my premiums. If I cannot afford the new premiums, they will drop me. At some point I am simply uninsurable. Being uninsured means I cannot afford my medication, and I will soon die.

Certainly, there is no universal imperative that says you are obligated to pay for others' care, but not doing so in this siutation is awfully callous and downright cold (we can debate the efficiency of Medicare/Medicaid at a later time). I hope you do not mean that.

Re:Obvious.

[Zordak]

who then pay taxes on their capital gains that will go to support these very programs

You sound like a socialist or at least somewhat radical sort (judging by your .sig), so I hate to fuel your fire, but here goes...

The capital gains taxes these guys pay on their fat dividends do not pay for Social Security and Medicaid. There is a separate flat-rate SSM tax that everybody pays without deductions, exemptions or exclusions. It accounts for something like 2/3 of our annual federal budget. But that tax is paid only on wages. It does not apply to capital gains, which are taxed at a fairly reasonable 15%. This is why Google pays top executives $1 annual salaries. That means these guys contribute about 7.5 cents to the SSM program every year, and then pay 15% on their dividends. If they were paid large salaries, they would be in the highest tax bracket, and thus would pay something close to 40% plus the 7.5% SSM tax. Don't get me wrong, they're still paying more in taxes every year than you'll probably make in your lifetime, but they are not paying for Social Security and Medicaid. That burden is borne squarely by the working middle class. The SSM tax on salaries only is not new, but the 15% capital gains tax was, of course, one of the tax reforms passed by your good friend George W. Bush.

Re:Obvious.

[mikbry24]

Also, I hear that productivity goes waaaay down when employees are sick ;)

Yeah, or when they unionize...I'm not sure which is worse.

Re:Obvious.

[Marxist Hacker 42]

Y'know what's really bizarre about that? My dad told me that several years ago, Walmart was touting 'made in America' in many of their advertisements. I really can't say first hand, as I might've started college before I'd been in a Walmart. Now it's full of alot of very poor quality Chinese merchandise. I remember especially when they leaned on Hasbro, resulting in the GIJoe line being replaced with their 50 cent generics. They're great for dangerous fireworks stunts, but they might as well be made of playdough. So it goes with alot of what they carry.

When Sam was alive, he was a patriot. EVERYTHING Wal-Mart sold was "Made in America" and a good amount of it was "Made by Union", despite the fact he resisted unions in his own stores, he saw the value of high quality workmanship in union suppliers. But then he died- and since he died, Wal-Mart has been for PROFIT not QUALITY.

Re:Obvious.

[tmbailey123]

While I agree with the premise that linking health insurance to employment is flawed, the premise that everyone can go out an purchase good health insurance in todays market is sheer lunacy. Obviously your familiy is blessed with relatively good health. Many families are not as blessed.

Insurance companies either simply refuse to write policies for those with serious health conditions or will increase the price of their existing policy till it is out of the financial means of that family. So a family with a member who has diabetes, cancer, luekemia, or other serious health malady is left without.

Healthcare in this country is treated as a for profit business. We have allowed this country healthcare system to place profits ahead of humanity and morality. Granted many of the social programs of other countries have their faults when trying to tend to the needs of their population at large, but at least everyone has an equal opportunity. This is not true in our country. The limited social "healthcare" in this country is more like "sickcare". Poor people wait until they are really sick before seeking treatment.

I will step off the soapbox before I start writing the epic novel on what is wrong with our healthcare system.

-mike

Re:Obvious.

[InsertCleverUsername]

Hmmm... I think you may be on to something there. Without ten layers of bean counters and paperwork, healthcare would certainly be cheaper.

Of course... Then there's the matter of trusting our government to do a competent job...

Re:Obvious.

[Bimo_Dude]

Well said.

I remember when Wal-mart was just starting their expansion. There was Sam Walton on TV saying that the chain only buys US manufactured goods, and tries to sell them for the lowest prices. There was a lot of hype about how "American" it was to shop there, and how they and their customers are helping the US economy.

Then Sam died. With him went his vision, as well as the ethics of the company.

He must be rolling over in his grave.

Re:Obvious.

[B_Realll]

I've never understood the hostility towards Wal Mart from the libs. If you are a Wal Mart "associate", you have agreed to sell them 40 hours of your life per week for some set dollar amount. If that isn't enough to cover health benefits, then GET A DIFFERENT FUCKING JOB! If they aren't paying enough then they won't be able to hire enough people to work for them. They obviously aren't having trouble getting enough people, so the emplyees must be happy with what they are making.

I'm glad my employer doesn't pay for my health insurance. It would end up coming out of my salary anyway, just like the social security witholding. My company isn't going to give me something of monetary value out of the goodness of their heart. At least this way I get to choose the health coverage I want, or gamble and spend that money on toys instead.

This entitlement shit needs to stop. You can't be free without taking personal responsibility.

Re:Obvious.

[aussersterne]

Yes and no. Those taxes are (theoretically) separate once they arrive in the feds' pockets. But they originate in personal wealth. Much of the middle class is now heavily invested because there is no social safety net and employers no longer provide pensions and banks can't keep up with inflation, much less exceed it.

So for example a mom and pop put their nestegg at least in part in the retail sector. Then, true to American values, they shop at the cut-rate retailers they're invested in because a) the retailers are doing well (that's why they invested!) and b) they want to support their investment, and of course c) the retailer is doing well because their prices are so low or their prices are low because they're doing well, it's the same thing. So mom and pop shop there to "make their buck go as far as possible" and to support the shops they're invested in. It makes sense to them. Most of the other investors do the same, and this middle-class group whose retirement and savings are in the market is a sizable portion of the U.S. investment economy now.

They are going to pay taxes on whatever their investments make for them, and they take these taxes as fair because their retail sector stocks are "making them money" and helping to grow their modest nestegg. But they are also paying into SSM through withholding, and the SSM program is likely to need to be bailed out any number of times from federal coffers anyway. So ultimately these people are inevitably subsidizing Wal-mart multiple times, once with their investment, again when their investments pay, and yet again when they pay in to SSM. Are these expenditures justified by the return that they do see, especially in context of a larger economy in which these same sectors exert heavy downward wage pressure, reduce job security for all, and the quality of goods is also dropping like a rock? No, it's not really making them richer overall. But they often fail to see the big picture.

So my point was (and I suppose the I felt that getting into mechanics would muddy it), it makes no difference to the middle-class investor which tax is which. He pays his taxes and it's all just "taxes" to him, but he figures that it's offset by his growing investments. Unfortunately, the growth in investments is indirectly being supported by the very taxes that he pays, and in combination with downward wage/wealth pressure (the sucking sound delivering wealth to china) and lower quality goods (that ultimately demand more expenditure over time, not less, again, more sales for China) he is actually getting poorer despite the apparent rise in his nestegg's value, because the rest of his life (from taxes to long-term goods expenses to wages) is losing value at a faster rate than his return is gaining-- all wealth that is moving offshore.

I have no ideological problem with wealth moving offshore, I think it's inevitable and probably fair, no reason the U.S. should have a standard of living that exceeds everyone else's. But too many free-market pro-neoliberal minds talk only about "return on investment" without placing that return in the context of the rest of the economy, in which any returns are offset by increased expenses and (and this may be the most important part) an increasing inability to turn back the clock or halt the slide as more and more communities, economies, businesses, personal budgets, and personal retirements come to rely on this sector. But you're right, I did run a couple of things together in my attempt to post quickly. My apologies.

Re:Obvious.

[winkydink]

Imagine if hospitals were more like the Department of Motor Vehicles...

You've never been in an HMO then, I expect.

Re:Obvious.

[wtansill]

And if you RTFA, companies can (and do) give lesser quality products under the same label to Wal-Mart. IIRC, the same is true of some of the stuff at Best Buy as well.

WHAT!!?? You get what you pay for? I'm shocked SHOCKED I tell you!

Re:Obvious.

[Ugmo]

Human resourcess should be a company's most important resource.

The above poster is correct, but many companies these days see resources as something to be used up and then spit out. They do not care if it is sustainable or not.

Using up employees without providing health care is like a mining company that strip mines a region. They then let a shell company declare bankruptcy rather than pay for the clean up they originally promised to provide as a condition to strip mine in the first place.

Using up employees is like a forestry company that goes into old growth forests and cuts down 500 year old trees. Even if they replant with saplings, the original value of the land will not come back during the lifetime of the whole company let alone the lifetime of the CEO.

In the article itself there is the value in the brand name of Snapper, built up through generations of producing quality goods. Walmart wanted to slap that brand on a cheaper line of junk. In the long term people would associate the "Snapper" brand with junk and so cheapen all the lines by association. Walmart wanted to strip mine the value of the brand for a quick profit.

In a similar way Walmart is strip mining the salary differential in America and places like China. Currently, Americans make more money than Chinese workers doing the same work. Walmart has stuck a spigot into the tank that is the American economy and is draining off the money to China, stopping to take their profit from the flow as it goes by. They do not care what happens when the tank empties out (or flow stops when the level just becomes even at the lowest common denominator). They are happy to make a profit NOW and forget about the future.

I believe that capitalism is a good system, but short term, next quarter oriented profit is not the way to go. There is value in long term planning, quality and brand loyalty that is not being taken into account in markets these days.

Re:Obvious.

[Kadin2048]

Human resources are a company's most valuable asset in some industries. "Brain-based" businesses, where the whole business is nothing but an office building, some computers and furniture, and a whole bunch of people, are pretty aware that if they're not recruiting and retaining good people, they're one foot in the grave.

However, Wal-Mart really is just using its employees as warm bodies. In fact, not even for that. Really they just do things that haven't been automated yet, at least not in a cost-effective way. It's still cheaper to hire a 19-year-old with a strong back to stock bigscreens on a shelf than it is to build a robot to do the same job.

The reason that the health and welfare of their employees doesn't really matter to Wal-Mart is because there is perceived to be a near-infinite supply of them waiting outside the glass doors, ready to take up the helm if anyone gets too ill or starts demanding a higher salary. And this is quite probably true, especially when you consider that Wal-Mart has shown in the past that its not adverse to hiring illegals.

Your salary, in a properly working economy, will never exceed your perceived cost of replacement. When your job can be done by anyone with 2/5ths of a brain and the normal human complement of arms and legs, in short, a lowest-common-denominator job, you shouldn't expect to live anything better than a lowest-common-denominator life. If you want to be paid more, find some way to raise your perceived replacement cost. But it's naieve to assume that anyone is going to pay their employees more than it would cost to recruit and train a new person to do their job; anything less would be irrational, and corporations are notoriously un-irrational.

Re:Obvious.

[Thangodin]

There are even more subtle and less known ways that they pick your pocket.

One of Wal-Mart's main strategies (well documented, by the way) is to create a monopoly in a small town by opening two big stores, with concessions from the local government for ramps, zoning, etc. Both stores have a lease which stipulates that they may not be rented to another retail business for decades. Both run at extremely low prices, even lower than usual for Wal-Mart. Finally, all competition collapses, leaving only Wal-Mart for many goods.

Then they close one of the two stores, forcing everyone to go across town to the other.

Around the closed store, the commercial district looks like a bomb hit it, and in the middle is this huge, empty cavern, subsidized by local businesses and governments. But the economic impact has been so devastating that the commercial district cannot recover, and the local government is strapped because it's just sunk millions into a traffic system to feed an empty parking lot, and now it has no tax base in the area.

Here's another one. Premium brands sell at Wal-Mart at a loss by supplementing their income with goods sold at higher prices by independents. But to try to stop the losses, they send their manufacturing offshore, and cut the quality of their items. So even if you don't shop at Wal-Mart, when you go to buy these items at an independent, you end up paying $80 for what is now really only worth $30. You have subsidized Wal-Mart, even though you have never set foot in one.

And another: Wal-Mart employees make so little money that many of them, particularly those with families, are collecting welfare. Your taxes are subsidizing Wal-Mart. Did you vote for that?

Any sufficiently large and powerful organization in a country becomes the defacto government of that country if the actual government is sufficiently weak, disorganized, or complicit with the organization. The difference, in a democracy, is that the actual government you can vote out. But how can you vote out a business when they can take your money whether you shop there or not?

Re:Obvious.

[The Beezer]

Also, growing up in a small town I saw a lot of situations where "small-town charm" also meant small-town bigotry and small-town narrow mindedness. Nice if you're able to make friends with the owner, but if your nationality or skin color is different, you may wish you had a big box around where you could at least just be ignored like everyone else in the store.

Re:Obvious.

[drsquare]

Mom and pop stores don't suck, they just have to sell at prices higher than walmart.

They charge higher prices because they can get away with it, they're often the only shop in town. The variety is poor, the quality is poor, the amount of stock is poor. Many of them only take cash, or have a cash machine that CHARGES for usage. Large chain supermarkets don't charge for cash machines.

They usually are very knowledgable about the product they sell,

How much knowledge is there to be gained about a tin of beens or a bottle of vodka? I'm there for shopping not an educational experience.

the place was dirty, shelves were disorganized

Sounds like 'mom and pop' stores to me. I can't speak for Walmart, but large British supermarkets like Tescos and Sainsburies are very clean, light and professionally run. On the other hand, small independent shops have lino floors, poor lighting, and the opening hours are rubbish.

If you're not open 24/7, I'm not interested. I'm a shift worker, and when I finish work at 3am those 'mom and pop' stores that close at 5pm are absolutely no use to me.

Re:Obvious.

[Pig Hogger]

Wal-Mart sells a huge variety of well-known well-regarded quality brands.... including Apple and Sony. If Apple and Sony are crap, than EVERY SINGLE PRODUCT EVERYWHERE is crap.

Plenty of manufacturer make cheaper/crappier versions of their products specifically to sell to Wall-Marde.

If you RTFA (I did, weeks ago), you'd see that Wall-Marde told the Snapper guy to have crappy lawnmowers manufactured in China with the "Snapper" label on them. The guy refused to adulterate his products by having Wall-Marde dilute their quality and so said no to Wall-Marde.

Re:Obvious.

[pafrusurewa]

The other side of the coin is that the low prices at Wal Mart are subsidized by the rest of us. For example, they don't provide proper health insurance to their employees which forces many of them to get government medical insurance assistance, otherwise known as Medicaid.

Very true.

Wal-Mart has been operating stores in Germany for a couple of years now. They still have to turn a profit there. This is partly because there are well-established discount supermarkets in Germany (you might even say they pioneered the concept -- think Aldi, which I think even has stores in the US). One other reason is that many of their tactics like firing employees for founding unions and having relationships with each other (believe it or not, they do this in the US) are just plain illegal in Germany and indeed most European countries. They did try though but they were successfully sued because of it.

I think this is a great example of how Wal-Mart makes money by exploiting people.

Re:Obvious.

[Pig Hogger]

Mom and pop stores don't suck, they just have to sell at prices higher than walmart. They don't have 3000 stores or the push-around power that walmart has due to its market share.

What I do get at the ma and pa store is a friendly face and great service. They usually are very knowledgable about the product they sell, and many times are willing to go the extra length if I have any problems at all with my purchase.

You lucky bastard. Over here, "mom & pop" stores have been going the way of the crapper, because mom & pop have not been willing to give the same no-hassle after-sale service that Wall-Marde is giving.

Fuck, for the lack of service, one might as well go to Club Price, at least, you don't have to face "mom & pop" saying that you don't have this in stock, that he can't order it in less than 6 weeks and when it doesn't work as advertised won't take it back.

This is why Wall-Marde is doing so well, because Mom & Pop has been busy screwing their clientele.

Re:Obvious.

[VAXcat]

>This is why corporate libertarians bewilder me. Deregulation is basically >handing the keys to a drunk driver. Oh yeah, because letting the government centrally control things always works out so much better! Good news Comrade! We have a new five year plan for lawnmower production! And the chocolate ration has been increased to 30 grams!

Re:Obvious.

[Tye_Informer]

This is the kind of thing that is thrown around a lot with no proof. It is true that quite a few first month Wal-Mart employees are on welfare. All that proves is that Wal-Mart is willing to hire people that are on welfare. Isn't that a good thing? The question is, how many 1 year or longer employees are still on welfare? For some reason you never hear that statistic even though the numbers are known (just as easy as determining how many 1st month Wal-Mart employees are on welfare).
 
I'll leave the answer to that question as an exercise for the student.

Re:Obvious.

[consultant]

That's hit the nail on the head, but the reverse is true for me. My family opened a mom and pop store in a remote town which we thought would be a great place to live, and we slowly suffered loss of sales and underperformance due to the bigotry of the locals, because we weren't one of them, and they would happilly tell us they didn't want us or our business.

They were however, happy to buy everything from faceless multinationals like Walmart. Then walk around complaining because all the big stores like Walmart have shutdown all the small independents. All the time I was in the small town, not one of the locals managed to make a connection between their behaviour and their complaints.

People are very strange sometimes!

Sometimes Less is More

[RunFatBoy.net]

The decision not to do business with Walmart is not only an issue of branding, but an issue of scalability. With your mowers in the hands of 20% more consumers, more warranties have to be honored forcing Snapper to increase 'support' for their machines.

And if it turns out that the lower end users have a propensity to be pickier about the product, requesting support, service, and such, the returns get even worse.

Jim http://www.runfatboy.net/

Re:Sometimes Less is More

[Lumpy]

you are ignoring something. the lower end will NOT buy a snapper. they will buy thr $99.00 cheapie. Just like the really busy Manager will buy the $99.00 cheapie.

They both buy the cheapie for different reasons. The low end buys it because that is all they can afford.

The Manager buys it because he can trash it on the curb in the fall and buy new in the spring not worrying about getting it tuned, the oil changed, new blade, and it get's it out of his garage for that Jaguar to sit all winter.

and the funny part is that disposable behaivoir fuels another economy. the garbage pickers that grab those mowers, do that maintaince and sells them for $50.00 because they still look new.

Re:Sometimes Less is More

[Smidge204]

The assumed cost of support is likely to be built into the cost of the product. If it's not, then they are already losing money on support.

Having read the summary, the real issue was twofold: First, in order to deal with Wal-Mart, Snapper would have to make sacrifices in both product quality and profit margin in order to compete with the already 'disposable' equipment that Wal-Mart sells.

Second, the bulk of their business (80% independent retailers) would find themselves outgunned by Wal-Mart's cutthroat prices. You might gain 20% at first, but that extra business slowly starts to eat away at your larger market base.

Gain 20% but kill 80%

So he chose to lose a little business, maintain their higher quality product and support his largest market sector.
=Smidge=

Re:Sometimes Less is More

[Pxtl]

And the only minor downsides are: horrendous waste of materials:

others will do it anyways

energy,

others will do it anyways

natural resources,

others will do it anyways

pollution,

not his problem, and others will do it anyways

slave and child labour abroad,

not his problem, and others will do it anyways

massive trade imbalances,

others will do it anyways

astronomical debt,

not his problem (probably his kids'), and others will do it anyways

erosion of American workplaces and a whole slew of other

not his problem, and others will do it anyways


fun side-effects of American Wal-Mart gluttony. Nothing to worry about. It is well worth that $150 he "saved".

welcome to the prisoners' dilemma at a worldwide scale.

Re:Sometimes Less is More

[hawkbug]

I'm not saying a global economy is bad by any measure - what I am saying is that the "disposable society" in with we live is very harmful to the world. I've had the same lawn mower for 10 years now. It's a high quality machine that I plan on using for many more years to come. I don't care if it was made in the U.S. or China - but what I do care about is that the resources that were used to manufacture it were not wasted. If I had to buy a new one every year, I would be very disappointed in knowing that valuable resources were wasted every year I had to buy a one. With my mower, the same piece of steel used in the body of the thing has worked great for over a decade now. I feel as badly about wasting resources everytime I need a new car, drink a can of soda out of a can, etc. The world needs to broadly adopt strategies that conserve resources. The problem is usually that captialism is in direct conflict with conservation.

The book title is wrong.

[Hamster Lover]

The book by Charles Fishman is called [i]The Walmart Effect[/i] not [i]The Man Who Said No to Walmart[/i], which is the title of the Fast Company article that forms the basis for the Slashdot article.

FYI

Re:The book title is wrong.

[Wootzor von Leetenha]

The post says he read it too :p

is this an ad or what?

[Suppafly]

I usually enjoy the book reviews here, but this isn't that, this just appears to be an ad.

Wow

[donutello]

Company A decides to target a higher-margin, lower-volume segment of the market v/s a lower-margin, higher-volume segment. I didn't need to read a 1000-word essay telling me about it. Companies do this all the time and it's not news. Sounds more like a publicity stunt for Snapper and the book author than anything else.

Similar story in Dutch supermarket

[plankrwf]

A similar thing happened a year ago in the Netherlands, where a Dutch 'cake'-maker* (for those who know Dutch: ontbijtkoek)
actually went to court so that they wouldn't be obliged to sell to a certain supermarket** anymore... (By the way, they won!)

Roel

* Peijnenburg was the 'cake'-maker;
** Albert Hein was the supermarket store.
Link in dutch:
http://www.rtl.nl/(/financien/rtlz/nieuws/)/compon ents/financien/rtlz/2005/02_februari/02-peijnenbur g_albert_heijn_supermarktoorlog_koek_uit_schap.xml

Re:Similar story in Dutch supermarket

[corbettw]

...a Dutch 'cake'-maker* (for those who know Dutch: ontbijtkoek)
actually went to court so that they wouldn't be obliged to sell to a certain supermarket** anymore

Huh? Why in God's name would the be "obliged" to sell to anyone? Is it part of the Dutch business license, that you can't refuse to do business with someone? Please explain in detail, I feel like I'm missing something.

Re:Similar story in Dutch supermarket

[plankrwf]

To be completely accurate; the supermarket-chain (Albert Hein) subpoena'ed the 'cake'-maker after the latter declined to deliver its 'cakes' to the former.

 
How the law is in particular I don't know (IANAL); in this case the two had done business with each other for many years; there might have been an ongoing contract for delivery.
(To get an idea what it was all about: the 'cake' in question was part of a commonly used "basket" used for comparison of prices
in different supermarket-chains. In this case, the 'cake'-maker felt that the supermarket-chain sold their product for a price
under the cost price (and placed the product at a "low visibility" place) so that it...
didn't cost too much while seeming to be cheaper at the "basket" comparison...)

Re:Similar story in Dutch supermarket

[corbettw]

To be completely accurate; the supermarket-chain (Albert Hein) subpoena'ed the 'cake'-maker after the latter declined to deliver its 'cakes' to the former.

Ah, must have been a contract dispute, then. That makes sense.

To the other poster, re: refusal to deal. Usually that only comes up if there some sort of relationship between the parties involved. For instance, if Wholesaler A refused to sell goods to Retailer X while selling to Retailer Y, who is a subsidiary of Wholesaler A or its parent company.

Real world example: I owned an online game store years ago (lost in the divorce, small price). This was around the time when Games Workshop started refusing to sell to online retailers, but still sold through their own mail order and online store. I casually mentioned the fact that it looked like they were trying to start a monopoly to my account rep one day, and never heard anything after that about not being able to buy product from them.

And this guy said...

[garcia]

And this guy said "YES!" to Walmart. Well, for 41 hours at least.

Kind of pointless

[RedHatLinux]

There are far more interesting and important issues involving Wal-Mart than some guy not willing to sell his stuff to them, like Crazy Fat Chicks

Also, check out this links.

Hel-Mart

Sprawl Busters

PBS Store Wars- Facts About Wal-Mart

Wal-Mart Blows.com

Wal-Mart Litigation Project

Wal-Mart Movie

Wal-Mart Sucks.org

Wal-Mart Watch

Wal-Mart vs Women

I knew this sounded familiar.

[TheSystemHasFailed]

This is actually a word-for-word duplicate of the FC article here: http://www.fastcompany.com/magazine/102/open_snapp er.html It's ALSO from back in January. Hemos needs to wake up...

Wal-Mart is a parasite

[MikeRT]

They have created a vicious cycle that makes it so that they drive down the profits of domestic manufacturers, which sends the good jobs out of the country, and then they sell the cheap, Chinese-made crap to the people who lost their job because now it's all they can afford. Eventually, the Wal-Martification of the economy will leave us on the brink of disaster because all of our real manufacturing will be outsourced.

What this guy did that was so smart was to recognize that at the end of the day, there is only economic destruction to be had from placing sales numbers and short term profits on a pedastal. Most of Wal-Mart's suppliers would do well to follow in his foot steps and reach a gentleman's agreement to collectively tell Wally World to agree to their terms or fuck off.

But wait... they can't do that. That'd be price colluding, even though it would actually benefit the public if the makers of kitchen supplies collectively pulled out of Wal-Mart, for example. Wal-Mart isn't that profitable. They make take in $220B a year, but last I saw they only make about $7B. You know what smart people call that, considering how many stores that profit is spread over? A house of cards. All it would take would be 1 or 2 years of a concerted effort by their suppliers to revolt to bring Wal-Mart to its knees.

Re:Wal-Mart is a parasite

[cant_get_a_good_nick]

You haven't described Wal-Mart as much as most capitalists today. The goal of every organization seems to be solely to drive down prices. Wal_Mart has just grown to the point where it's most effective at it.

The problem isn't walmart per se as much as how we've constructed the system. It focusses solely on a very small part of the complex system known as an economy, an individual corporation's costs. It rewards companies that do this - Wal-Mart, Dell, etc. The problem is this isn't good for the long term health of the overall system.

Henry Ford years ago knew that the best way to make his cars sell was to have overall system health. The efficiencies of the assembly line allowed him to raise wages, as he thought having people able to afford his cars was a good thing. The Snapper guy saw the same, the long term health of his company, and made a business decision that he felt was best for longer term health. I wish him well, he doesn't have the advantages that Ford did at his time, and lots of disadvantages.

Re:Wal-Mart is a parasite

[hey!]

Parasite? Landlord is more like it.

This reminded of something I learned 20 years ago when my college made me learn economics: Ricardo's Theory of Rent.

Suppose you are a landlord with two plots of land suitable for growing corn. A, however, products more corn per acre than B. Do you charge the same rent? Of course not. You charge more for A of course. But how much more? Ricardo's argument supposedly showed that if A produced a hundred bushels a year more than B, market forces would place the rent of A at price higher than B by the amount of profit in a hundred bushels of corn.

Get it? Any excess productivity due to the land goes to the landlord.

I don't see why his argument doesn't apply equally to Wal-Mart. If Wal-Mart's access to customers is so much greater, then the differential profit is largely if not entirely theirs.

Why would you do business with them? Well, perhaps you're especially efficient at being a large scale sharecropper. Your marginal cost for producing an 100 additional bushels of corn is less than the difference in rent, so you still profit more by renting A. The fellow renting B, however, may be at or above his capacity. Imagine he makes fancy "artisinal" corn to supply high end restaurants. He could in theory produce more corn on A, but it would cost him more than the difference in rent.

Clearly, a company like Snapper is no more suited for supplying Wal-Mart than a Japanese Kobe beef farmer can supply McDonalds. And that wasn't what Wal-Mart wanted. Wal-Mart was offering him a chance to liquidate the value in his company's brand, turning future steady profits into quick cash. If this had been a family business with sons who didn't want to take it over, it would have been a sweet deal. However, as he intended to continue running the business, it was not in his interest to undermine his high end product with cheap knock-offs carrying the same nameplate.

It's not exactly a genius move.

Re:Wal-Mart is a parasite

[Sycraft-fu]

But not all companies are like that. I think people tend to overfocus on the companies that screw their employees and forget there are a lot that don't. In the category of competition to Wal Mart there's Costco. They are a discount sotre, big warehouse large volume and all that. They are profitable, to the tune of $1 billion per year real profit (like $6.6 billion gross profit), $3 billion in the bank, less than a billion in debt, all in all a solid, profitable corp. None the less they pay their employess very well, to the tune of $15/hour, they get good benefits, etc.

They don't make as much as Walmart does, but then they aren't as big. Also Walmart has a great deal of outstanding debt, about 70% of their total equity, whereas Costco could pay their entire debt, if it was to their advantage to do so.

It's perfectly possible for companies to thrive and not be cutthroats like Walmart. Will they be as big? Maybe not, but who cares? There is room in the market for a big guy who's all about cutting things to the minimum as well as others that pitch a little higher class.

Walmart's "low prices" aren't some magical field that just suck everyone in. I personally don't care for their stores and the merchandise they choose to stock. So I don't shop there, I shop at Costco instead for the most part. Works just fine. It's not like Walmart is charging 10% of what their competitors do or anything. Sure they are probably a little cheaper, but not enough I have to care.

Not really earth-shattering

[Erwos]

I mean, really, this is hardly the earth-shattering revelation I was expecting. Walmart sells cheap stuff. Company wants to sell expensive stuff. Company decides not to go with Walmart. There weren't any death threats or dirty tricks, just some calm discussion and reasonable logic.

I don't see why it's news that branding and quality are important. Even the folks running Walmart are not so dense - they just like to feed off that lower part of the retail sector. Historical note: the United States got its start in the textile industry not by producing higher quality stuff than you'd find in, say, Britain, but by producing lower quality stuff that was "good enough", but much cheaper. America got a reputation for cheap, lousy material - but then again, everyone bought it, even when better-but-more-expensive local material was available

-Erwos

wow

[donnyspi]

Wow, thanks for the "brief" "summary." I don't think I need to read the book now...

Re:He's not a very good businessman...

[hey!]

...so you keep your precious Snapper brand name for your quality products and start up some new brand name for your low end crap you sell at Wal-Mart.

Because Walmart didn't want his production capabilities. They wanted his brand.

Re:This article is...

[east coast]

It makes the company look good, look smart, look loyal to its customers, and so forth.

And that's a problem how? In the age where most companies are willing to hamstring their customers for the WalMart fast buck it's good to know that there is somewhere that does play like that.

Now read about the man who said YES to Wal-Mart

[digitaldc]

http://www.cnn.com/2006/US/03/29/walmat.spring.bre ak.ap/index.html
DES MOINES, Iowa (AP) -- For spring break, some college students set out for sun-drenched beaches or cheap European cities. Skyler Bartels headed for the local Wal-Mart. Bartels, 20, an aspiring writer and Drake University sophomore, thought he'd spend a week in a Wal-Mart as a test of endurance, using it as the premise for a magazine article. His college adviser liked the idea.
For 41 hours, Bartels wandered the aisles of a Wal-Mart Supercenter in Windsor Heights that's open 24 hours a day. He checked out shoppers, read magazines, watched movies on the DVD display and played video games.
Other shoppers and employees didn't pay much attention until the end of his stay, he said, when it appeared some store greeters began to take notice -- pointing at him and whispering.
A shift manager approached him and asked him if he was finding everything he needed.
"He said, 'Didn't I see you over by the magazines, like, five hours ago?' I told him, 'Maybe,"' Bartels said.

This guy lived at Wal-Mart during his Spring Break. I heard Des Moines can be boring at times, but come on now, whatever happened to exploring the great outdoors?

Re:And???

[ShaniaTwain]

..and they all lived happily ever after.

Worked, too.

[tgd]

I need to buy a lawn mower this weekend. I had no idea Wal Mart sold them.

That'll save me some money!

Re:He's not a very good businessman...

[Secrity]

The problem is that Wal-Mart wants cheap lawnmowers with a prestige name on them. Wal-Mart doesn't care if the products are the same quality as what are sold at higher priced dealers, they just want mowers that have shiny bells and whistles and a prestige name brand. I used to have a Snapper lawn mower, it really was a good as the review made Snapper sound. I had the mower for five years and sold it for nearly what I paid for it.

For what it's worth...

[syrion]

Snappers really are excellent mowers. I don't know that I'd buy a Snapper push-mower, just because push-mowers tend to get banged up since their job is basically to get the rough areas where a riding mower won't go, but their riding mowers are reliable and easy to maintain.

Not the whole story...

[shrapnull]

Snapper had been acquired by Simplicity, just as Simplicity was acquired by Briggs & Stratton. This gives B&S all tiers of products: consumer, professional and commercial.

Snapper may not be in the commodity stores, but that's not because they are a boutique item. It is an intentional attempt to maintain a reputation of dignity among professionals.

From Simplicity Manufacturing's Website:

On July 4, 2004, Briggs & Stratton Corporation acquired Simplicity Manufacturing and its companies Snapper, Ferris Industries and Giant-Vac. The purchase represents Briggs & Stratton's first attempt to serve the lawn and garden industry directly. Briggs & Stratton believes this acquisition will allow it to build closer relationships with its OEM and retail customers from an operational, sales and marketing standpoint.

"Simplicity is a solid company with several compelling brands, a strong position in the retail dealer channel for outdoor power product, and superior product development capabilities," said John S. Shiely, Briggs & Stratton's Chairman, CEO and President. "This acquisition is another step in our strategy to present an even more compelling value proposition to consumers of our products and superior returns to our shareholders," he said.

Simplicity Manufacturing, Inc. Port Washington, WI

In other words, they already had the cheap crap to sell (B&S Mowers), and didn't want to compete with themselves with higher priced models that could go to specialty home improvement stores where they would move more quickly.

The difference.

[hal2814]

"Wier doesn't really think that a $99 lawn mower from Wal-Mart and Snapper's lawn mowers are the same product any more than a cup of 50-cent vending-machine coffee is the same as a Starbucks nonfat venti latte."

Yeah, one of each pair is massively overpriced for what you get. Snapper makes a decent mower, but similar quality mowers can be found at far cheaper prices.

Re:There is competition

[oirtemed]

I've boycotted them 100% now...its not hard and it really isn't a $$ issue. Anyone with half a brain will realize that the stuff at Walmart isnt inexpensive, it is just cheap. There are few things in their stores that I could not get somewhere else for cheaper, often much cheaper, or a better product for a comparable prices. The only thing walmart had was its convenience...having all that shit in one place can save trips, though I found you just ended up buying stuff you didn't need.

Re:And???

[MarkGriz]

"...has recently published a book entitled The Man Who Said No To Wal-mart."

Re:And???

Apparently you've never seen a slashvertisement before.

I can confirm one thing

[99BottlesOfBeerInMyF]

As someone who spent one summer installing security cameras in a Wal-mart (so they could more carefully watch their cashiers) and assembling lawn-mowers etc. for displays and for customers who paid for that option, I can confirm that the quality of the machines they sell is abysmal. It was not at all unusual to go through three sets of parts to get enough properly made parts to assemble one lawn mower. I wouldn't accept one as a gift.

"More Target-like?"

[Rob T Firefly]

Snapper is the sort of high-quality nameplate, like Levi Strauss, that Wal-Mart hopes can ultimately make it more Target-like.

Wait, wait, wait.. there's supposed to be a difference between Target and Walmart??

Re:"More Target-like?"

[MonkeyCookie]

Actually, yes. Target tends to attract more affluent customers who are willing to pay a bit more than the typical Wal-mart customer. Target does this by creating the perception that their products of higher quality, but still relatively cheap. (I have to admit that I certainly think that Target products, while not being of high quality, are on average better than what one finds at Wal-mart)

I can certainly see the difference in customers where I live. At Wal-mart, most of the customers look like they emerged from a nearby crack house, whereas at Target the customers tend to be more of a mix of lower- and middle-class shoppers.

Briggs and Stratton

[gatkinso]

A lawn mower is for the most part, an engine. B&S makes engines for most of the mowers out there (Snapper included). B&S engines are also on Murrays - the $138 mower sold at Walmart.

I bought one of these mowers 5 years ago... and it still runs fine.

Briggs and Stratton is the real variable here, not Snapper.

Re:Briggs and Stratton

[sirwired]

The deck on your $138 Murray special is made from much thinner steel, uses plastic bushings on the wheels, has a diapraghm-based carb, (which is an inferior design to the bowl-carbs used on better engines) uses cheaper paint, a smaller, less-powerful engine, poor mulching capability, and has a smaller fuel tank. It also has a weaker handle, and is a pain to adjust. Maintenance is messy and more difficult. On the other hand, it is a LOT lighter than a quality mower.

As a random side note, B&S ALSO owns Murray. Murray went bankrupt, owed B&S a lot of money, so B&S picked up the whole company on the cheap.

SirWired

remember iPods @ Wal-Mart?

[mblase]

I seem to remember that, in the early days, iPods weren't purchasable anywhere except directly from Apple. Partially this was because they weren't in demand yet, and eventually it became a matter of Apple refusing to discount its products for anybody. The price you paid for a new iPod (or any new Apple product) at Apple's stores is as low as the price you paid anywhere else.

As iPods became more and more popular, it became painfully obvious that Wal-Mart was the last major retailer not to sell them. And, of course, this is because Wal-Mart's policy is to price anything it sells lower than all of its competitors.

So Wal-Mart had a problem: they needed to sell these iconic iPods, but Apple wouldn't let them sell it at a lower price. They'd be eroding their own business, but more importantly, they'd be losing a lot of money on what Apple insisted should be a quality product worth a higher price.

Eventually the two came to some kind of compromise, because you can buy a new iPod Nano at the Apple Store for $149.00, or at Wal-Mart for... $147.88. No matter what iPod you want to buy, Wal-Mart will sell it to you for precisely $1.12 less than Apple. And I'm assuming that Wal-Mart eats that loss themselves in the hopes of selling iPod accessories to you while you're in the store.

Capitalism is capitalism, and I don't begrudge Wal-Mart for the quite successful strategy it uses. But let's face it: for the most part, you get what you pay for. I'd much rather keep enjoying the $150 DVD player I have in my family room than some $30 P.o.S. from an off-brand Chinese manufacturer who only sells it to Wal-Mart because the remote control is incomprehensible and the components aren't expected to last a year.

Re:remember iPods @ Wal-Mart?

[kneeo]

So dont buy the $30 P.o.S. nobody is forcing you. You can buy whatever dvd player you want, where ever you want.

Just remember that sometimes those P.o.S. players can play all sorts of file formats, and have hacking abilities. Apex anyone?

The $150 player may not even play DVD+Rs or DVD-Rs. God forbid RWs.

Inside baseball?

[rrauwl]

I'm... blown away by this advertisement for Snapper. What makes this a SlashDot worthy article? I used to be a professional writer. I pitched stories on two technology related startups (who will remain nameless so as to respect the editor's right of refusal) to SlashDot that were very relevant. The first was about an open iTunes publisher who puts your music up for sale for a flat fee (ties in with digital music rights, open source). The second was a new web based real estate company (that I'm the CEO of, but they knew that) built on 100 percent open source software, promoting affordable housing by taking a team approach with real estate purchases. Now I'm fine with these kinds of stories being turned down, if SlashDot's policy is to avoid anything that might even be considered free advertising. They'll have to pass on some very relevant pieces, but that's the price you pay. Sure, a reasonable policy. But after seeing this, I have no idea what to think. Maybe Jeff just loves their products. Maybe he liked the writing. We may never know. All I can say is: This piece was an advertisement, pure and simple.

Re:Wal-Mart intendes to run the brand into the gro

[B3ryllium]

Every higher organism on this planet instinctively develops a natural equilibrium with the surrounding environment, but Wal-Mart does not. It moves in on a brand, and it consumes and consumes, until every shred of credibility is destroyed. The only way it can survive is to spread to another brand. There is another organism on this planet that follows the same pattern. A virus. Wal-Mart is a disease, a cancer of this planet, a plague - and hippies are the cure.

Re:Walmart-free since 1998

[eaddict]

Likewise... and I haven't really missed it. I KNOW I am getting better quality stuff from other plaes. In fact, I can't recall the last time I went to Wal-Mart and went in. I was with a friend the other day who just wanted to stop in (during lunch) and I said I'd wait in the car. It eventually lead to a discussion about Wal-Mart and now they don't shop there anymore.

Waking up one customer at a time since....

Don't bring up Henry Ford out of context

[A nonymous Coward]

Henry Ford's context for those amazing wages was that he was the first, or one of the first, mass production automobile manufacturers, had little or no competition, and could afford to not sweat the salaries in order to hire the best workers. No one ever mentions that, they make him out to be some magnanimous altruistic nice guy who liked paying his workers fairly. He was not. He was just as cold blooded as any factory owner and later proved it when he had competition.

Re:And???

[temojen]

And now I don't have to read (or buy) the book.

Re:And???

[crabpeople]

because you know, slashdot users are the coveted "basement recluse" demographic which lawn care vendors have been trying so hard to reach...

Lawn Chairs

[SnarfQuest]

It was just some lawn chairs that some other peddler had left behind as samples.

Maybe Microsoft had just been through, and thus they needed new chairs in a hurry.

Classic centralization argument.

[Kadin2048]

Actually, what you're saying is, in fact, probably true. If your goal was to insure everyone in the country at the lowest rate possible, then the most efficient way to do it would be to only have one giant insurance company, and one risk pool.

However this ignores several things. First, and what I think is most important, is by eliminating all competition in the insurance industry, you would remove any impetus to become more efficient. Such a company would probably become hideously bloated and turn into a giant cash sink, employ many times the number of people it actually needed to operate, and would be beholden to basically nobody. Since there wouldn't be any alternatives for customers to switch to, their level of service could also deteriorate to rock-bottom.

The argument you're making is the classic argument for centralization in an economy. "Hey, everyone wants to have a car -- why don't we just make one really big car factory? It'll be really efficient." True, but not everyone wants the same car, and even if they did, eliminating the competition in the marketplace to build better cars would probably over time eliminate the advantage of centralization.

Re:Classic centralization argument.

[NMerriam]

What you state is absolutely correct for any normal commodity -- building one car factory or stereo component store would be a recipe for disaster. No incentive for development, efficiency or improvement.

Fortunately, health care has no relationship whatsoever to other commercial industries. Customers don't shop for health care. The amount of specialized knowledge you'd need to compare the providers of every kind of care is beyond the reach of any single human being. If you wait until you need a particular care, you usually need it immediately, which precludes comparison shopping. You can always walk away from a bad car salesman, but if you're bleeding to death you don't have much negotiating power if the hospital tells you it is $3,000 for admittance.

Health care needs no advertising -- Insurance companies are't spending billions of dollars on commercials so that people know there is such a thing available and they should buy some. All they're doing is taking customers from each other and money away from actual care. In the computer business, that would be fine, since a smaller transistor size on the manufacturing side or broader market on the customer side can make up for the marketing expenses, but I can assure you that there's nobody having heart attacks with health care advertising that wouldn't have had one already (or vice-versa). State Farm isn't developing any top-secret surgical procedures that Allstate won't have access to.

Incentive to improve is omnipresent since Death is a far more efficient competitor than Microsoft or State Farm. Death has no overhead, he's penetrated every market segment and is very efficient at finding new opportunities for development. Death works 24/7 -- even on holidays! No matter how good insurance and health care are, there will always be real and constant pressure on them to improve.

The fundamental issue is that we're not willing to let people simply die on the street. If someone walks into an emergency room, we, as a society, have legally required that hospital to provide stabilizing care. They cannot tell the guy to go die on the street if his credit card is declined, which means that ultimately, we the taxpayers are going to pay for such emergency medical care regardless of how the cmmercial market should or shouldn't work in an ideal world.

Finally, the major difference between medical care and every other industry is that the cost of most goods doesn't increase unpredictably (but preventably!) by thousands of percent in a matter of moments. If you were shopping for a CD player and the price was $50 -- wait, no it's $50,000! -- you'd be pretty shocked and kick yourself for not having bought it last week when it was $50.

But that's exactly what we're dealing with -- a $50 annual checkup would allow us to prevent many of the $50,000 emergency visits we already pay for. I can't imagine it makes more economic sense to write out $50,000 checks every time someone walks through the ER door, but refuse to cover the $50 checkup that would have not only increased their health in the first place, but prevented them from losing time at work and contributing to the economy.

Re:Classic centralization argument.

[NMerriam]

You really need to take a Valium before logging on, sir.

You didn't shop for health care, you shopped for copays and dental/vision options and PPO choices (which of course can change at any moment, but you have to wait until next years' open enrollment to make any changes on YOUR side of the agreement).

You don't have the slightest clue beyond the very basics what actual health care you have available until you are in a situation where you need it and they tell you a particular procedure isn't covered, or that the hospital went over the limit and by the way here's the bill for the extra (how the heck should you know what the hospital has negotiated with your insurer and be able to verify they didn't go over -- were you supposed to ask the anesthesiologist how mcuh he charges for a breathing tube while he was putting you under?)

When you were in the selction process, did you actually go through and examine the credentials and experience of the potential heart specialist they would send you to if you had a heart attack? Or did you just see that your family doctor was on the list? Do you know which endocrinologist they have approved?

Did you know that if you're in a life-threatening accident and are treated while unconscious, you might get charged tens of thousands of dollars when you wake up because the ambulance took you to the wrong hospital and you didn't go to an approved one after 24 hours? Did you take that into account while "shopping" or did you just look at the phone book of doctors they give you to see that yours was listed and say "fuck, I don't know what any of this is, but paying $20 for my wife's perscription is better than $30, so I'll go with Aetna!"

So you're feeding us a complete line of utter bull, and it isn't necessary for me to read further into that big wordy comment you made.

I'd hate to trouble your initial knee-jerk reaction. have a nice night!

Re:Classic centralization argument.

[NMerriam]

Why would I un-say the truth?

Aside from food and water (which most adults can select on their own with minimal skill and usually requires many poor choices over a period of time to have any long-term negative effects) there is nothing else you will ever purchase that your life depends on.

Medical care is it -- you will die if you're wrong, you will die if you try to save money in the wrong place, your children will suffer permanent physical damage for the rest of their lives if you make the wrong choice ONCE when they are 3 months old. What other purchasing decision has that effect? What other industry has that effect?

Despite how important proper health care is to most people's basic survival (hey, you could be lucky and never even get a bruise, most people aren't), you have no chance whatsoever of making a fully informed decision at the proper time, which is required for proper operation of a free market.

That makes it completely unlike any other product, any other industry on Earth.

Re:Snapper makes the finest lawn mowers available!

[Greatmoose]

Honda lawn mowers. I've got an 11 year old one and my dad's go a 17 year old one. Very nice machines (of course, they ARE Honda engines...)

Wrong

[geekoid]

I, and many peple I know, will spend more money in a local owned shop, then any chain.

Twice as much? no, but then I have never seen any chain have the same item for half the price as a mom and pop. Almost always within 20-0% depending on the level of item cost. The more expensive type of item, the less difference there is.

I don't go to wal-mart. I have known people who have been in management, and the stories they tell are amazing. The red lining books, telling companies how to operate once they become dependent on WAL-Mart sales, getting a company to make a cheap version of it's product, then using it against that same company.

Yes, business want to make money, but that does not oblidge them to behave poorly.

Re:here come the shallow idealists

[evilviper]

I have to say, you're just simply wrong...

The problem is that the idealists are in the minority, while the shallow whiners who will do anything to save a buck are the majority.

Personally, I haven't gone in to a walmart in several years, even though it's the closest store to me. Personally, I'm happy to pay twice as much if it means I don't have to dig through piles of junk strewn around the store, don't get treated like cattle, and don't have to wait in absouletely massively long lines, because they don't want to open another register.

What's more, paying twice as much, elsewhere, usually puts you out ahead... Instead of getting cheap crap at Walmart, you can get decent-quality crap elsewhere, which will be better from day 1, and last a lot longer as well.

I think the real of Walmart becomes most obvious when you compare Sam's Club with Costco:

http://gnn.tv/articles/239/The_Wal_Mart_Myth

http://shogo.gnn.tv/headlines/3846/Is_Being_Genero us_Good_For_Business

Re:Walmart Sells Quality When Forced

[Plaid Phantom]

It saddens me that we Arkansans/Arkansawyers are so equated to Wal*Mart. Though I can't think of anything better to be associated with.

Health insurance

[booch]

The bigger problem is having for-profit insurance companies make health care decisions for people. Companies are required by law to maximize profits. These same companies then get to decide what level of medical care you get. If that's not unethical, I don't know what is.

Re:Health insurance

[booch]

The articles of incorporation for most companies will include a statement that their purpose is to make a profit. The executives and board members have a fiuciary duty to ensure that they do their best to meet the stated purposes of the company.

If you have some evidence to the contrary, please present it.

Re:Editors: Remove this article

[AaronStJ]

From the summary:

From THE WAL-MART EFFECT by Charles Fishman. Reprinted by arrangement with The Penguin Press, a member of Penguin Group (USA), Inc. Copyright (c) Charles Fishman, 2006. Charles is a senior writer for Fast Company magazine.

Way to bitch about the summary, but not read it.

Hey

[cubicledrone]

Is anyone else bothered by the fact that the U.S. is borrowing money to buy products from foreign countries with unemployment checks?

Anyone else bothered by the fact that entire towns are being closed because Wal-Mart says "your product is too expensive?"

Can anyone explain what the fuck "your product is too expensive" has to do with the free market? Isn't "too expensive" the customer's decision?

Anyone bothered by the fact of both record budget and trade deficits while 50% of working-age adults are not employed full-time?

Or is everyone just fine with their neighbors being thrown out of work while they rack up another five figures on the 28% credit card for a plasma TV?

Can anyone tell me what "circling the bowl" means?

This isn't about low low prices. This is about low low standard of living. It sucks and it's getting worse.

Yes, like Canada and half the rest of the world

[tentimestwenty]

Employers should have no connection with the health system and neither should individuals. The best system, one that is practised in Canada, Cuba, almost all of Europe and tons of other countries is a government supplied, universal health care. Everybody gets good service and everybody pays equally according to their means. It's about basic human dignity and support of your fellow man. As soon as money gets involved it's survival of the richest.

Regulation, Give the keys to drunk w. best BS line

[HornWumpus]

It's not like government has a better record then buisness.

How many millions did buisnesses kill in the twentyth century? Far fewer then governments.

We still have'nt found a good way to select leaders. All that is apparent is that anybody who wants to lead should not be allowed to. I'm for selecting the president and congresscriters by lottery (of actual voters).

Re: And???

[Slugster]

And this story is old. I swear I saw it at least a couple months ago.

...Also I would bet that Snapper is doomed in ten years anyway. Ongoing analysis and JIT manufacturing can save money but can't reverse the US$:yuan exchange rate--and this is the real race Snapper is (losing) in. The ratio of quality to crap sold in most consumer items is rather disenheartening, and professional principles keeps snobby customers happy and gets applause from the peanut gallery but won't usually keep the lights on.

I am operating on a health and investment theory I like to call "dumb money".
What it revolves around is the principal that anything that lots of unintelligent people like is probably both unhealty to do and horribly overpriced as well--and I should therefore invest in it, but not use it myself. One idiot alone is just a random opinion of course (and generally a bad one), but when you average the opinions of increasing-numbers of idiots, the consistency is amazing.

The alien greys probably have a branch of mathematics for this.
~

Re:Delaying death is not the kind of incentive nee

[NMerriam]

What you need is incentives to keep costs under control.

Medicare keeps medical costs under control better than any private insurance company. The government uses the exact same mechanism as the private carriers -- they negotiate specific rates they will reimbuse for a procedure. The only difference is that the government doesn't also need marketing expenses and profit, which takes another 20-50% out of the actual medical care provided by private insurers.

Get a job in a hospital in the US sometime, you'll see that medicare and private insurance operate almost exactly the same, the only difference being that medicare doesn't waste as much money on "other stuff". People complain about government bureaucracy, but Medicare can be a downright easy process compared to most private insurers if you're doing anything more complicated than getting a wart removed.

Otherwise you will keep the costs under control by rationing care like in Canada and England. That's just the historic record.

Health care is always rationed, and it is rationed more by private companies than it is by US government health insurance. Insurers do everything possible to keep you from ever actually getting expensive care. Dealing with Medicare or the Veteran's Administration isn't always convenient, but there is no deliberate hurdle-jumping placed in your way as there is with private care. There are no claims processors looking for excuses to deny coverage so that you're stuck with half a needed treatment and a hundred grand of debt if you want to continue.

People do shop for health care, you're just not in the right age group to notice yet. What do you think old folks talk about (their kids, grandkids and their health/doctors).

I'm not in the right age group as a buyer, but I did work in public/private healthcare for the last decade so I have a more than passing acquantaince with the process. Old folks talk about care, but only the wealthy ones can actually afford to change providers. If you've got a solid retirement savings that covers long-term care, that's great, but that covers maybe 5% of the health care customers in the USA, and they aren't the ones anybody is concerned about.

Many insured people don't get their checkups on time.

Denial and other human foibles are certainly factors, but when it comes to private insurance you also have to realize that people are often genuinely scared of going to the doctor if they think something is wrong. If they find out they are unhealthy, they could lose their job or insurance, because now they are a "risk". God forbid you discover you have diabetes or another chronic but livable condition -- your premiums will become crazy (or you will be outright uninsurable) if you pay for your own coverage, or you will become a huge liability to your employer if you don't.

We've put people in a lose-lose situation where it is BETTER for them to willfully ignore health problems as long as possible, all because we refuse to accept that it makes no sense to make health insurance a market commodity. Nobody can do without it, everybody needs it, and if you tie it to emplyment, all it does is put people's jobs in jeopardy when they do, inevitably, get sick.

It reminds me of the old joke about democracy -- of course government health care is a horrible, horrible idea. But it is still better than all the alternatives.

In theory, everything you say is right. I support the free market, believe it comes up with the best solutions through competition, and find government sluggishness to be incapable of meeting the changing landscape of needs. Unfortunately when it comes to health insurance, for many reasons theory and reality part ways and the free market has somehow managed to provide worse care at higher cost while not even being able to cover those most in need of the service!