Wal-Mart Stores, Inc. Strategic Corporate Research Report
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Cornell University ILR School DigitalCommons@ILR Research Studies and Reports ILR Collection 2-1-2006 Wal-Mart Stores, Inc. Strategic Corporate Research Report Aaron Brenner Cornell University Barry Eidlen Cornell University Kerry Candaele Cornell University Follow this and additional works at: https://digitalcommons.ilr.cornell.edu/reports Thank you for downloading an article from DigitalCommons@ILR. Support this valuable resource today! This Article is brought to you for free and open access by the ILR Collection at DigitalCommons@ILR. It has been accepted for inclusion in Research Studies and Reports by an authorized administrator of DigitalCommons@ILR. For more information, please contact [email protected]. If you have a disability and are having trouble accessing information on this website or need materials in an alternate format, contact [email protected] for assistance. Wal-Mart Stores, Inc. Strategic Corporate Research Report Abstract [Excerpt] Wal-Mart Stores, Inc. (hereinafter Wal-Mart) is the second-largest company in the world. It has more annual revenue than the GDP of Switzerland. It sells more DVDs, magazines, books, CDs, dog food, diapers, bicycles, toys, toothpaste, jewelry, and groceries than any other retailer does worldwide. It is the largest retailer in the United States, Mexico, and Canada, the second-largest in the United Kingdom, and the third largest in Brazil, With its partners, it is the largest retailer in Central America. Wal-Mart is also the largest private employer in the United States, Mexico, and Canada, and it has 1.8 million employees around the globe. Wal-Mart is so huge that it effectively sets the terms for large swaths of the global economy, from retail wages to apparel prices to transoceanic shipping rates to the location of toy factories. Indeed, if there is one single aspect to understand about the company, it is the fact that Wal-Mart is transforming the relations of production in virtually every product category it sells, through its relationships with suppliers. But its influence goes far beyond the economy. It sets social policy by refusing to sell certain types of birth control. Its construction of supercenters molds the landscape, shapes traffic patterns, and alters the local commercial mix. The retail goliath shapes culture by selling the music of patriotic country singer Garth Brooks but not the critical (and hilarious) The Daily Show with Jon Stewart Presents America (the Book): A Citizen’s Guide to Democracy Inaction. It influences politics yb donating millions to conservative politicians and think tanks. Wal-Mart is, in short, one of the most powerful entities in the world. Not surprisingly, Wal-Mart has developed a long list of critics, including unions, human rights organizations, religious groups, environmental activists, community organizations, small business groups, academics, children’s rights groups, and even institutional investors. These groups have exposed the company’s illegal union-busting tactics, its many violations of overtime laws, its abuse of child labor, its egregious healthcare policies, its super-exploitation of immigrant workers, its rampant gender discrimination, the horrific labor conditions at its suppliers’ factories, and its unlawful environmental degradation. They have also chronicled the deleterious effect Wal-Mart has on the public coffers and the quality of community life. New Wal-Mart stores and distribution centers often swallow up government subsidies and tax breaks, take public land, create more congestion, reduce overall wages, destroy retail variety, and increase public outlays for healthcare. To its critics, Wal-Mart represents the worst aspects of 21st-eentury capitalism. Wal-Mart usually counters any criticism with two words: low prices. It is a powerful mantra in a consumerist world. The company does make more products affordable to more people, and that is nothing to sneeze at when wages are stagnant, jobs insecure, pensions disappearing, and health coverage shrinking. With low prices, Wal-Mart helps working men and women get more from their meager paychecks, more necessities like bread, and more luxuries, like roses, too. It is a brilliant and incontrovertible argument, and Wal-Mart’s most ardent defenders take it even farther. They say its obsession with low prices makes the entire economy more efficient and more productive. Suppliers and competitors have to produce more and better products with the same resources, and that redounds to everyone. In the micro, it means falling prices and rising product quality. In the macro, it means economic growth, more jobs, and higher tax revenues. To its defenders, Wal-Mart represents the best aspects of 21st-century capitalism. Despite their radical opposition, critics and defenders of the world’s largest corporation agree on one thing: Wal-Mart represents 21st-century capitalism. It symbolizes a system of increasing market penetration and decreasing social regulation, where more and more aspects of life around the world are subject to economic competition. Wal-Mart’s success rests upon the ongoing destruction of social power in favor of corporate power. It takes advantage of the conditions of the neo-liberal world, from the availability of instant and inexpensive global communication to the continuing collapse of agricultural employment around the world to the rapid diffusion of technological innovation to the oversupply of subjugated migrant labor in nearly every country to the continued existence of undemocratic and corporate-dominated governments. For some, this is as it should be, all part of capitalism’s natural and ultimately benign development. For the rest of us, Wal-Mart is at the heart of what is wrong with the world. Keywords Wal-Mart, globalization, capitalism, corporations Comments Suggested Citation Brenner, A., Eidlin, B., & Candaele, K. (2006). Wal-Mart Stores, Inc. strategic corporate research report [Electronic version]. Retrieved [insert date] from Cornell University, ILR School site: http://digitalcommons.ilr.cornell.edu/reports/62/ Required Publisher Statement Copyright held by the authors. This article is available at DigitalCommons@ILR: https://digitalcommons.ilr.cornell.edu/reports/62 Wal-Mart Stores, Ine,1 Aaron Brenner, Barry Eidlin, and Kerry Candaele Under the supervision of TomJuravich Conference Research Director Kate Bronfenbrenner Conference Coordinator February 1, 2006 Prepared for the International Conference Global Companies - Global Unions - Global Research - Global Campaigns 1 This report was funded by the universities supporting the Global Companies-Global Unions-Global Research- Global Campaigns conference and prepared in keeping with one o f the primary goals o f the conference- increasing our understanding o f the changing nature o f the structure and practices o f multinational corporations in the global economy. It was prepared for educational purposes only and should not be copied, distributed, or disseminated beyond the participants o f this conference. Neither Cornell nor any o f the authors or other academic institutions involved in preparing this report intends to advocate or advance any particular action by any individual or organization as a result o f the report. TABLE OF CONTENTS 1. Executive Summary...................................... .............. „....„.............................................................1 1.1 Description and Operations............. .............................................................................................2 1.2 Profit Centers............................................................... .................................................................. 5 1.3 Growth Plan..................................................... .............................................................. ...............6 1.4 Key Decision Mahers............................................. ....................................................... .......... 7 1.5 Key Relationships..............................................<......... ................. ................ ...............................8 1.6 Possibilities for Union Cross-Border Comprehensive Campaigns,..................................... 9 2. Introduction............. .......................................................................................... ............................. 11 2.1 Basic Information................... .............................................................................................. 11 2.2 Company History...................... ............................. .............................................................. 11 3. Operations................................ ................................................................ ................................ ....... 17 3.1 Business Segments............................... ...................... .................. ....................................... 18 3.1.1 Products and Services......................................................................... ............................. 19 3.2 Organization o f Production and Services.................................................................................22 3.2.1 Store Operations............................................ ................................. ■„.......................... .......25 3.2.2 Distribution Centers................. ........... ..................................... ............................... .......... 27 3.2.3 Facilities.............................................................................