I read an article recently that highlighted the recent closing of some large big-box stores. The author questioned what could be done with these giant buildings when they close. They’re too big for anything other than what they were built for. They just leave a big gaping hole in a parking lot dotted with megastores.
As usual, any mention of big-box stores generates a great number of comments, many talking about how Wal-Mart-like mega-entities needed to be purged from our communities. A later comment was incredulous to these comments. “Are you kidding me? You can afford to pay for items at regular retail cost?” This comment got me thinking, and I realized that perhaps Wal-Mart is much more intelligent and dubious than we give them credit for. They might be marketing GENIUSES. To demonstrate, allow me to outline the steps of the cycle that we seem to be stuck in. Note that I mention Wal-Mart but I do mean big-box stores in general.
Step 1: The United States has a retail system that works well for the most part. Larger department stores balance smaller mom-and-pop shops.
Step 2: Wal-Marts make their appearance in communities. These stores focus on everything they can to provide rock-bottom prices to their customers, including encouraging cheaper overseas manufacturing, volume, and low-paid, non-unionized employees.
Step 3: Customers flock to Wal-Mart, because now their money can go 20-30% farther, and they can afford more than they ever could. Everyone wants more stuff. (It’s ok, everyone has good, secure jobs. Put in on a credit card!)
Step 4: Businesses who can’t lower their prices to compete without going out of business feel the strain from the loss of revenue. Some do end up going out of business. The same thing happens to local manufacturing companies as they are bypassed for cheaper overseas labor.
Step 5: The employees of the businesses in Step 4 are now losing their jobs. Some get new jobs but as the cycle continues, there are less jobs out there for them to get. Some get jobs at Wal-Mart for a lower pay, but there are still more people losing their jobs than those getting them.
Step 6: Unemployment increases as the cycle continues. People struggle to balance out, but less and less people can afford to shop at regular retail stores, so they must shop at Wal-Mart. Return to Step 4 and repeat.
So, this logic does bring up that because we supported Wal-Mart while they took money away from companies in this country and their employees, some blame falls on our shoulders for the economic collapse. If we weren’t so driven by greed and the desire to get more for less, maybe there would still be decent jobs in this country, that pay better and allow us to live reasonable lives. But because more and more people are forced to tighten their belts every day, jobs are disappearing fast and people are going broke.
And that brings me to Wal-Mart’s brilliant marketing plan. If (and that is IF) they indeed foresaw this cycle, then it would be safe to assume this - A complete economic collapse would have been the goal they were shooting for, because this would make sure that no one would have enough money to shop anywhere else. Kinda funny that they had the foresight to sell EVERYTHING you could need in their stores, from food to clothes to computers to eyeglasses.
Wal-Mart did assume one thing - that communities would support a company that did not support them back. Since it was our greed and desire for more that propped them up, and collapsed so many others, looks like we didn’t disappoint.
Wal-Mart may very well be the last one standing and they couldn’t be happier. Kinda funny that Wal-Mart is a poster-child of the free market, with a very quick rise to success and great profits. Now, many people argue that the free market can fix itself if no one does anything. The only problem is that everyone may have starved to death long before it happens.