Wal-Mart: the Main Street Merchant of Doom

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Wal-Mart: The Main Street Merchant of Doom

Synopsis
The case “Wal-Mart: The Main Street Merchant of Doom” is a look at the origins of the company Wal-Mart. The case initially portrays Sam Walton as the “hired gun” to help small towns defeat the businesses that take advantage of the lack of purchasing options. Wal-Mart guaranteed their prices would always to low and fair. This was a new concept for the small towns, so they welcomed the company with open arms.

The company was greatly successful and grew to an exponential level. Wal-Mart opened thousands of stores across the country and even tapped into other countries abroad. By adopting a real-time computer based inventory system, the company was able to cut overhead and limit employees needed to conduct inventories and track shipments. Wal-Mart reigned as the world’s largest retailer with $191 billion in sales in 2001, which jumped to $345 billion by 2007.

This success did not come without opposition. The thrill of the new options Wal-Mart brought, soon wore off. The company was attacked my many groups, all of which wished to keep the retailer out of their community. The opposition claimed the store took jobs away from its citizens and forced small businesses to close. Wal-Mart chose to defend itself with campaigns such as the “Buy American” campaign which attempted to motivate more suppliers to make American products to sell in their stores. Although suppliers responded well, Wal-Mart inevitably began to sell foreign products again to ensure the prices were low for the customer. Other complaints about Wal-Mart were voiced as well. The complaints all seemed to be addressed for a short time by creating reactive efforts to silence the masses. Environmental awareness and social responsibility were also concepts that opposition felt the company overlooked. Wal-Mart began campaigns to show citizens that the company was making attempts to be environmentally friendly by using recycled paper for price tags, putting recycling bins in the parking lots and attempting to build “green” stores that would use solar panels as power.

A class action lawsuit was initiated due to the company’s lack of social responsibility. The claims were the company demanded employees to work on off time, deprived them of lunch breaks and refuses to compensate for over-time hours worked. The low wages and lack of benefits made it impossible for some employees to live a comfortable life. Since many small businesses were closed as a result of Wal-Mart, working there was relatively their only option.

Although many oppose Wal-Mart, there are far greater supporters of the low price retailer. Based on the case, Wal-Mart is estimated to have nearly 100 million shoppers a week. These supporters point out the highlights of the company’s contribution to society. Wal-Mart donates to scholarships, children’s organizations, and educates the public about recycling. The company has become a household name and for that, many families would not be able to purchase many of the necessities if it were not for the company’s dedication to low prices.

Ethical Issues
The underlying ethical issue concerning the case about Wal-Mart is social responsibility. Wal-Mart from the beginning preached one idea but practiced another. Sam Walton’s vision was to provide more choices at lower costs to save families from the overpriced, limited retailers. In a broad sense, he did just that. But when a deeper look is taken, it came at the expense of thousands of jobs, businesses and unfair wages and benefits.

Topics
Wal-Mart has sacrificed its legitimacy and core values in order to become dominant in the retailer sector. Legitimacy is established by providing a service in a way that is social acceptable. As the text states, “Business exists solely because society has given it that right.” This idea no longer applies to Wal-Mart. It has become such a powerful company with lobbyist and political backing, that any person or...
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