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Amazon and Walmart Are In An All-Out Price War That Is Terrifying Big Brands (recode.net)

gollum123 quotes a report from Recode: Last month, Walmart gathered some of America's biggest household brands near its Arkansas headquarters for a tough talk. For years, Walmart had dominated the retail landscape on the back of its "Everyday Low Price" guarantee. Walmart wants to have the lowest price on 80 percent of its sales, according to a presentation the company made at the summit, which Recode reviewed. To accomplish that, the brands that sell their goods through Walmart would have to cut their wholesale prices or make other cost adjustments to shave at least 15 percent off. In some cases, vendors say they would lose money on each sale if they met Walmart's demands. Brands that agree to play ball with Walmart could expect better distribution and more strategic help from the giant retailer. And to those that didn't? Walmart said it would limit their distribution and create its own branded products to directly challenge its own suppliers. But this time around, Walmart's renewed focus on its "Everyday Low Price" promise coincides with Amazon's increased aggressiveness in its own pricing of the packaged goods that are found on supermarket shelves and are core to Walmart's success, industry executives and consultants say. The result in recent months has been a high-stakes race to the bottom between Walmart and Amazon that seems great for shoppers, but has consumer packaged goods brands feeling the pressure.

3 of 467 comments (clear)

  1. Re:Why shop at Walmart by Anonymous Coward · · Score: 5, Informative

    Like this?

    http://www.homedepot.com/p/Rubbermaid-Commercial-Products-Brute-10-Qt-Red-Bucket-FG296300RED/202649172
    https://www.walmart.com/ip/Rubbermaid-Professional-Plus-Round-Brute-Bucket/16622204

    Sure, same basic product, but different part numbers; the labeling and packaging is probably visibly different in the stores as well. BTW you can get the crappy model on amazon too.

    The walmart one is good enough for 99.9% of us, and anyone who needs a better bucket probably knows not to cheap out in the first place. Some of us don't want to spend double for something made for more heavy duty jobs than we'll ever need it for. And no one's forcing Rubbermaid to manufacture it or do business with walmart at all if it's unprofitable or "destroying their brand". If it were they could sell it under a different brand name altogether.

    Not every product from every brand needs to be "premium"; not every car Chevy sells is a Camero.

  2. Re:No cronyist legal restrictions in retailing by mjwx · · Score: 5, Informative

    But American Healthcare has been publicly funded for decades. In fact, the cost of healthcare in America was under that of Germany before socialized healthcare was brought in.

    Sorry but that is incorrect.

    American health care corporations have been publicly funded for decades, but not healthcare itself.

    Also you're spending far more than countries with public health care. 2015 expenditure per capita in USD:
    Australia = $4420
    Canada = $4608
    France = $ 4407
    Germany $ 5267
    UK = $4003
    US = $9451

    Out of the 35 OCED countries, the US is the most expensive with Luxembourg taking up the number 2 spot ($7765). Out of the 217 countries surveyed by the WHO, the US is 217. You can take 27 off of that number if you like because the WHO has no statistics for 27 nations, but I'd find it hard to believe that French Polynesia has a significantly higher health care spend than the US.

    So it isn't that the US doesn't have the money to spend, its just that the system is completely wrong. If the US copied the UK's NHS verbatim, you would half the cost of your health care and eliminate almost all out of pocket expenses and probably 90% of all insurance premiums.

    --
    Calling someone a "hater" only means you can not rationally rebut their argument.
  3. Re:Why shop at Walmart by Anonymous Coward · · Score: 4, Informative

    "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 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."
    https://www.fastcompany.com/54763/man-who-said-no-wal-mart