Your cash ain't nothin but trash - or why I hate Walmart

[Skywatch_NC]

Like Chad...I'm another Wal-Mart lover!!

And hey...at least they allow Salvation Army volunteers during the holiday season!

Eric

[isobar]

Walmart is good for inexpensive items, but I would to say their way of doing business is good and harsh...

Harsh??

Yes, harsh. Walmart has a business ethics that is well-known throughout the business community. You see what they do is they force vendors to release all merchandise information regarding how much raw materials costs that make the goods, so that Walmart can figure out what it costs to make that good, and then they tell the vendor how much they are willing to pay for that item. The vendor has to agree on that request or their item does not get sold at Walmart, and since items sell well they have no choice, but to release this information. On the other hand, WALMART usually sells its inventory within 3-5 days, 7 being the max before they rotate out and buy more merchandise. Walmart pays for these items NET 30 days, so when they sell wihtin days they use the money that should go to the vendor and continue buying the merchandise basically on the vendors money, thus it doesn't cost Walmart anything to buy the merchandise because they are paying it back within the 30 days, but they get huge returns on their money. example: they purchase $100,000 in let's say in trash cans. They (Walmart) sell the $100,000 within let's say 2 weeks. The money owed is not due until day 30, so they use the money that should go to the vendors and buy other merchandise, thus using the vendors own money to buy items. When the 30 days are due, Walmart pays the vendor what is due, but they get in return huge profits from merchandise bought and sold on the vendors own money. That is what I mean by harsh.

That sounds like capitalism at work, good business sense, certainly not exclusive to Walmart. They are honoring their contracts. I can't imagine any vendor not being ecstatic about having their product on (and quickly off) Walmart shelves.

They obviously pass savings onto the customers or they wouldn't be so much cheaper than other retailers.

[Guest]

Walmart is good for inexpensive items, but I would to say their way of doing business is good and harsh...

Harsh??

Yes, harsh. Walmart has a business ethics that is well-known throughout the business community. You see what they do is they force vendors to release all merchandise information regarding how much raw materials costs that make the goods, so that Walmart can figure out what it costs to make that good, and then they tell the vendor how much they are willing to pay for that item. The vendor has to agree on that request or their item does not get sold at Walmart, and since items sell well they have no choice, but to release this information. On the other hand, WALMART usually sells its inventory within 3-5 days, 7 being the max before they rotate out and buy more merchandise. Walmart pays for these items NET 30 days, so when they sell wihtin days they use the money that should go to the vendor and continue buying the merchandise basically on the vendors money, thus it doesn't cost Walmart anything to buy the merchandise because they are paying it back within the 30 days, but they get huge returns on their money. example: they purchase $100,000 in let's say in trash cans. They (Walmart) sell the $100,000 within let's say 2 weeks. The money owed is not due until day 30, so they use the money that should go to the vendors and buy other merchandise, thus using the vendors own money to buy items. When the 30 days are due, Walmart pays the vendor what is due, but they get in return huge profits from merchandise bought and sold on the vendors own money. That is what I mean by harsh.

That sounds like capitalism at work, good business sense, certainly not exclusive to Walmart. They are honoring their contracts. I can't imagine any vendor not being ecstatic about having their product on (and quickly off) Walmart shelves.

They obviously pass savings onto the customers or they wouldn't be so much cheaper than other retailers.

Nope, they are not. If I was a vendor, I would not give up my trade secrets for Walmart, hell no.

[banshee]

"they tell the vendor how much they are willing to pay for that item. The vendor has to agree on that request or their item does not get sold at Walmart"

That is the absolute truth. In addition they will tell a vendor come down on your prices or we will put x brand in your space. The vendor comes down, they still reduce the vendors space and put x brand side by side. Now when your VF selling wrangler, having levis right next to you aint a vision of sugarplums.

In addition to NAFTA, Wallmart's bully tactics in the retail world is another reason so many textiles have moved to mexico. If wallmart is your number one account, you give to their needs. I've seen many many heated negotiations between wallmart and jeanswear so I imagine the negotiation tactics are the same across the board.

Sidenote: for those who buy jeans, tommy and wranglers and levi's all cost the same to make, 5 dolla. In fact, Tommy and Wranglers are made in the same plants in mexico and run side by side in the lines.

[chadtm80]

"they tell the vendor how much they are willing to pay for that item. The vendor has to agree on that request or their item does not get sold at Walmart"

umm.. Im trying VERY hard to see how this is a problem? I am the purchaser for my company here.. Dont you think I tell them what I will pay and what I wont pay? If I didnt do that my company wouldnt make the money the can.. I mean isnt that common sence? and good Buisness?

You mean they look after themselves and there employees before they worry about there vendors making a buck? you must be kidding me Wxcrazy if you dont mind me asking what do you do for a living?

Some just cant stand a company doing that well.. Well for me. I say good for them. Do you think they started out like they are now? Or do you think they worked hard and struggled to get there? Anyone happen to know how many people have jobs because of them? Anyone know how much money they save middle America?

[alicia-w]

i agree with you except that the vendor has to agree to sell it to them at that set price for a number of years....

i'll try to find the source for that.

[chadtm80]

i agree with you except that the vendor has to agree to sell it to them at that set price for a number of years....

i'll try to find the source for that.

And?? The vendor agrees.. How is that a fault of Walmarts? If I talk a car salesmen into giving me a low interest rate for 5 years instead of 3 am I doing anything wrong?

[alicia-w]

http://www.fastcompany.com/magazine/77/walmart.html

Here's an article on the business practices behind the success of Walmart. Some bad, but mostly good things that define why they're one of the largest corporations.

[banshee]

Chad the vendor almost has to agree or risk losing millions. Walmart, unfortunately, has the monopoly on mass retail sales. Nothing like a dealership. Walmart is VF Corp's #1 retailer. Chances are if they are VF's #1, they are the #1 for almost every one else in the market. VF tells walmart, no we wont reduce our price, walmart says ok, I wont sell your goods and you lose. VF would have to combine the sales of all its other retailers to come close to what walmart sells and the others combined probably wouldnt match.

[alicia-w]

thanks for defining that better than i did.

[Guest]

i agree with you except that the vendor has to agree to sell it to them at that set price for a number of years....

i'll try to find the source for that.

And?? The vendor agrees.. How is that a fault of Walmarts? If I talk a car salesmen into giving me a low interest rate for 5 years instead of 3 am I doing anything wrong?

While, I did not read the whole article, and why because I am tired of reading book after books about Walmart's inner working. Anywhow, Chad, Walmart feeds on company's that want its product in Walmart. However, to have to release private and sensitive info to do it, is none sense. I think their business ways are agressive and work, but in IMHO it is ruthless business.

[chadtm80]

Chad the vendor almost has to agree or risk losing millions. Walmart, unfortunately, has the monopoly on mass retail sales. Nothing like a dealership. Walmart is VF Corp's #1 retailer. Chances are if they are VF's #1, they are the #1 for almost every one else in the market. VF tells walmart, no we wont reduce our price, walmart says ok, I wont sell your goods and you lose. VF would have to combine the sales of all its other retailers to come close to what walmart sells and the others combined probably wouldnt match.

Yes.. I understand what they do.. And I think its good buisness.. If you can get a cheaper price, thats what you do as a buisness.. Its a no brainer.

P.S. If it wasnt for BIG BAD Walmart those vendors wouldnt be selling there product.. Walmart does have the upper hand.. Thats good for them, and YOU.

[alicia-w]

except that often those vendors have to outsource their jobs(to China, etc.) to keep their expenses down.

it doesnt matter how low their prices are if one doesnt have a job.

my last bit on this since I dont shop at Walmart anyway for a myriad of reasons.

[Lindaloo]

There is nothing wrong with negotiating a price. People do it everyday. Negotiating those prices is why Walmart can undersell anyone out there. All this talk about Walmart and vendor negotiations but don't you think that Target and other compnies do this? It is not bad business, it is doing business.

[banshee]

Its not necessarily good for me. Consider this, all VF textiles are made either in Mexico or overseas. Yes the homegrown cowboy jeans and shirts are made in other countries. Western wear shirts are made in parts of asia while the cowboy jeans, wranglers, are made in mexico. Along with Lee Jeans, Redcap, Jantzen, VF intimates, etc. Nothing made in the US. So, that leaves us with all the US plants that used to employ US workers, some in extremely small towns such as Irvington AL with only a flasing light, ALL closed and ALL US workers unemployed. So that leaves us what? Unemployed workers with little to no skills who can no longer spend money on goods. Any goods. NAFTA has arranged for these workers to obtain job retraining and get paid, but unfortunately most dont have what it takes to retrain for a new market. Thats not an insult, just a fact. Some can retrain for more technical jobs but many cant. All in all I dont condsider Walmart tactics a good thing.

[Guest]

There is nothing wrong with negotiating a price. People do it everyday. Negotiating those prices is why Walmart can undersell anyone out there. All this talk about Walmart and vendor negotiations but don't you think that Target and other compnies do this? It is not bad business, it is doing business.

Target may impose some business practices like Walmart, but will never duplicate. Walmart has a tendency to teeter on unethical business practices, but it is that fine line that they have mastered.

[chadtm80]

You guys think for ONE second that if target or kmart or any other retail store could get prices as cheap as walmart could by them they wouldnt do it? Honestly.... Come on.. You wanting to punish them for being the best they can be

[Lindaloo]

Its not necessarily good for me. Consider this, all VF textiles are made either in Mexico or overseas. Yes the homegrown cowboy jeans and shirts are made in other countries. Western wear shirts are made in parts of asia while the cowboy jeans, wranglers, are made in mexico. Along with Lee Jeans, Redcap, Jantzen, VF intimates, etc. Nothing made in the US. So, that leaves us with all the US plants that used to employ US workers, some in extremely small towns such as Irvington AL with only a flasing light, ALL closed and ALL US workers unemployed. So that leaves us what? Unemployed workers with little to no skills who can no longer spend money on goods. Any goods. NAFTA has arranged for these workers to obtain job retraining and get paid, but unfortunately most dont have what it takes to retrain for a new market. Thats not an insult, just a fact. Some can retrain for more technical jobs but many cant. All in all I dont condsider Walmart tactics a good thing.

Walmart employs Americans. That should be enough don't you think?

[Guest]

Its not necessarily good for me. Consider this, all VF textiles are made either in Mexico or overseas. Yes the homegrown cowboy jeans and shirts are made in other countries. Western wear shirts are made in parts of asia while the cowboy jeans, wranglers, are made in mexico. Along with Lee Jeans, Redcap, Jantzen, VF intimates, etc. Nothing made in the US. So, that leaves us with all the US plants that used to employ US workers, some in extremely small towns such as Irvington AL with only a flasing light, ALL closed and ALL US workers unemployed. So that leaves us what? Unemployed workers with little to no skills who can no longer spend money on goods. Any goods. NAFTA has arranged for these workers to obtain job retraining and get paid, but unfortunately most dont have what it takes to retrain for a new market. Thats not an insult, just a fact. Some can retrain for more technical jobs but many cant. All in all I dont condsider Walmart tactics a good thing.

Walmart employs Americans. That should be enough don't you think?

I guess if you look at it that way.

[Lindaloo]

There is nothing wrong with negotiating a price. People do it everyday. Negotiating those prices is why Walmart can undersell anyone out there. All this talk about Walmart and vendor negotiations but don't you think that Target and other compnies do this? It is not bad business, it is doing business.

Target may impose some business practices like Walmart, but will never duplicate. Walmart has a tendency to teeter on unethical business practices, but it is that fine line that they have mastered.

What about Kohl's? That store is nothing but a glorified Walmart with steeper prices. What is your point? Guess what? Walmart still beats them.