i>USAToday reports this morning, in words that probably send a chill down the spine of every retailer not from Bentonville, Arkansas, that “we are a Wal-Mart nation.”
Among the statements that USAToday makes on the front page of its business section:
• “Wal-Mart's influence on the U.S. economy has reached levels not seen by a single company since the 19th-century rise of Standard Oil, economists and historians say.”
• “Even if you don't shop at Wal-Mart, the retail powerhouse increasingly is dictating your product choices — and what you pay — as its relentless price cutting helps keep inflation low.”
• Wal-Mart is the biggest customer, or tied for first place, at the following manufacturers: Rayovac (26 percent of that company’s sales), Dial (24 percent), Hasbro (17 percent), Procter & Gamble (17 percent),
Newell Rubbermaid (15 percent), Gillette (12 percent), Fruit of the Loom (10 percent), H.J. Heinz (10 percent), Kimberly-Clark (10 percent), and Kraft (10 percent).
• Wal-Mart is moving more aggressively into private label that can afford it better margins and profits, though it says it remains committed to carrying national brands. However, major manufacturers now find themselves adjusting their product lineups to cater to what Wal-Mart is willing to sell, and even contemplating mergers and acquisitions that will allow them to more efficiently serve Wal-Mart.
• Wal-Mart “averages 100 million customers a week. That's 88.5 million more people than U.S. airlines fly in a week.”
• “The chain's buying power is so immense that 450 suppliers have opened offices — many in the 1990s — near Wal-Mart headquarters in tiny Bentonville, Ark. As many as 800 more such offices are expected in the next five years.”
Fascinating story, and well worth reading for its summation of how Wal-Mart impacts national productivity levels, employment and salary issues, and even inflation -- and therefore the nation’s economic health.
Among the statements that USAToday makes on the front page of its business section:
• “Wal-Mart's influence on the U.S. economy has reached levels not seen by a single company since the 19th-century rise of Standard Oil, economists and historians say.”
• “Even if you don't shop at Wal-Mart, the retail powerhouse increasingly is dictating your product choices — and what you pay — as its relentless price cutting helps keep inflation low.”
• Wal-Mart is the biggest customer, or tied for first place, at the following manufacturers: Rayovac (26 percent of that company’s sales), Dial (24 percent), Hasbro (17 percent), Procter & Gamble (17 percent),
Newell Rubbermaid (15 percent), Gillette (12 percent), Fruit of the Loom (10 percent), H.J. Heinz (10 percent), Kimberly-Clark (10 percent), and Kraft (10 percent).
• Wal-Mart is moving more aggressively into private label that can afford it better margins and profits, though it says it remains committed to carrying national brands. However, major manufacturers now find themselves adjusting their product lineups to cater to what Wal-Mart is willing to sell, and even contemplating mergers and acquisitions that will allow them to more efficiently serve Wal-Mart.
• Wal-Mart “averages 100 million customers a week. That's 88.5 million more people than U.S. airlines fly in a week.”
• “The chain's buying power is so immense that 450 suppliers have opened offices — many in the 1990s — near Wal-Mart headquarters in tiny Bentonville, Ark. As many as 800 more such offices are expected in the next five years.”
Fascinating story, and well worth reading for its summation of how Wal-Mart impacts national productivity levels, employment and salary issues, and even inflation -- and therefore the nation’s economic health.
- KC's View:
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All of which sounds like an argument for federal intervention to make sure that Wal-Mart doesn’t exercise too much power over prices and innovation. However, the piece also quotes some analysts as saying Wal-Mart hasn’t gotten to that point. Yet.
For retailers that might read this piece and start contemplating early retirement or suicide, we’d offer one small reassurance.
Sure, Wal-Mart wants to be America’s store.
But for a long time, the Dallas Cowboys thought of themselves as “America’s team,” and this past season, undercut by ego and arrogance and not enough talent on the field, the football franchise went 5-11.
