November 6, 2011
Is Wal-Mart smothering small town America? As of 1994, Wal-Mart had 2,504 stores across the U.S. and was expected to open 125 more that year (Ortega 205). Wal-Mart stores do over $67 billion dollars in annual sales (Norman 207). Everywhere there is evidence of new establishments being built. It seems that cities are now reaching out further and small towns growing up overnight. Some call it progress; others call it sprawl. One of the most recognizable faces popping up in the new development is the brainchild of Sam Walton, the founder of Wal-Mart. New Wal-Marts are being constructed as currently estimated at the rate of one a day. These superstores invite strong feelings pro and con and the effect of their presence is much debated. The purpose of this paper is to examine the effects of the discount superstore entering into a community. Discount stores like Wal-Mart allow small to medium towns with little population growth to hold customers to the local shopping area by cutting down on trips by locals to bigger urban areas with lower prices (Stone 210).
Is Wal-Mart an example of the great American dream or a small town nightmare? It is difficult to travel far without finding a Wal-Mart looming on the horizon bustling with shoppers scrounging to save money. Founded in 1962 in Bentonville, Arkansas by entrepreneur Sam Walton, Wal- Mart has grown into a commercial superpower offering products and services in a one-stop shopping format that may include: automotive service, banking, fast food, optometry, photography, and hair and nail salons. Wal-Mart provides low-cost shopping for the cash- strapped consumer. However, the question continues as to whether the end result is positive or negative when Wal-Mart locates a store, which can sometimes be over 200,000 square feet, on the edge of town. Proponents of the mega-superstore cite the creation of new jobs, lower-priced goods and increased city revenue as benefits. However, many people in the communities are convinced its presence will have negative effects on the smaller, existing community "mom and pop" stores, and lead to the dissolution of a unique small-town atmosphere. Studies as to the effects of introduction of big-box retailers, those with merchandising establishments over 100,000 square feet, have been conducted in various regions with conflicting results. This study will analyze those previous studies and also the various viewpoints for and against the introduction of large discount superpowers into a community. Emphasis will be placed on the introduction of Wal-Mart as it is currently the United States' largest retail establishment. There will also be some discussion as to how currently operating small businesses can perhaps adapt to doing business in the shadow of the giant. ). Instead of trying to preserve Main Street U.S.A., a system that has become an evolutionary dead-end, anti-Wal-Mart and small town advocates need to determine what areas of consumer demand aren't serviced, or aren't adequately serviced, by the big stores and focus on filling that market niche (Stone 211-212).
Many believe the mega discount store Wal-Mart is a plague set upon small “mom-and-pop” businesses. The instant Wal-Mart moves into town, all small businesses are destroyed in its path, leaving downtowns barren and empty. This popular misconception has garnered significant media publicity and widespread public acceptance. President Clinton’s former secretary of labor, Robert B. Reich, wrote in a 2005 New York Times op-ed that Wal-Mart turns “main streets into ghost towns by sucking business away from small retailers.” One of the largest anti–Wal-Mart organizations, Wal-Mart Watch, released a report in 2005 claiming that a Wal-Mart expansion in Iowa was solely responsible for the extensive closings of mom-and-pop stores, including 555 grocery...