Monday, June 25, 2012

NEIGHBORHOOD STORES

"We're also located right in your community, so you don't have to travel long distances to get to a Walmart. And most importantly, we have the Walmart price in this small building."

I'd like to pass on a few statistics about Wal*Mart and how big its gotten. Although it has suffered a slowdown in its growth, Wal*Mart is one of the few big businesses that has been booming in this economy, probably for the same reason Woolwolrth's and Penny's did in the depression: low cost, high selection, ease of finding everything with minimal travel.

These stats are from an American Digest comment, which concludes that probably we should let Wal*Mart run the economy, since they seem to know what they're doing:
  1. Americans spend $36,000,000 at Wal-Mart Every hour of every day.
  2. This works out to $20,928 profit every minute!
  3. Wal-Mart will sell more from January 1 to St. Patrick's Day (March 17th) than Target sells all year.
  4. Wal-Mart is bigger than Home Depot, Kroger, Target, Sears, Costco, and K-Mart combined.
  5. Wal-Mart employs 1.6 million people, is the world's largest private employer.
  6. Wal-Mart is the largest company in the history of the world.
  7. Wal-Mart now sells more food than Kroger and Safeway combined, and keep in mind they did this in only fifteen years.
  8. During this same period, 31 big supermarket chains sought bankruptcy.
  9. Wal-Mart now sells more food than any other store in the world.
  10. Wal-Mart has approx 3,900 stores in the USA of which 1,906 are Super Centers; this is 1,000 more than it had five years ago.
  11. This year 7.2 billion different purchasing experiences will occur at Wal-Mart stores. (Earth's population is approximately 6.5 Billion.)
  12. 90% of all Americans live within fifteen miles of a Wal-Mart.
Some time ago when passing a store that had shut down in my mom's neighborhood I thought about a business model which huge chain grocers could use. The concept was simple: open up a branch in neighborhoods like a convenience store, but keep the prices down by the volume you can sell and purchase at due to the size. Stores like Wal*Mart are so big and buy such vast quantities of food that they're able to get these materials cheaper than competitors, and pass that on to their customers.

The problem with smaller stores is that there's a larger number of employees per item on the shelf, and with a smaller selection of goods, you pull in fewer people than a big box store. That means less profit, so these shops have a smaller profit margin just to stay open. If you're a giant like Wal*Mart, you can eat that smaller profit margin much easier than a little company or even a single owner, plus you can obtain goods much cheaper, which helps that profit margin.

And Wal*Mart seems to have figured that out. They're opening up "Neighborhood" versions of their Wal*Mart stores, about a quarter the size of the usual shop. They stock just the grocery section of the Superstore, and are in local neighborhoods rather than gargantuan box stores off in the distance.

Naturally, there's opposition to this from the usual suspects, but the truth is, these shops help elderly and infirm people, they are a bonus to the poor who can buy things more cheaply in a Wal*Mart, and having a local store you can walk to or even a short drive means less stress on the environment from pollution. The idea of small grocery stores opening in communities even addresses the "food desert" scheme that leftists like. In other words, every single thing these leftists usually consider a good, this company would provide, but they still hate it. Here's a sample comment from the LA Times story of a Neighborhood store proposed in Altadena California:
Walmart hurts the small local business!
Walmart has poor labor practices!
Walmart offers poverty wages!
Walmart does not provide any health care insurance for employees.
Walamrt cuts the workers' hours to avoid paying any full time employee...s' benefits!
One of my friends worked at the warehouse of Walmart at Inland Empire, and he did not get any water from company, and his supervisors kept the time check even though he went to restroom!!!!!!!

Workers deserve dignity! Please say "NO! NO! NO! to Walmart"
Fewer emissions and helping the disadvantaged? Who cares! Union!!!! The problem is that although Wal*Mart is beneficial to the elderly, poor, and disabled, despite the fact that it addresses 'food desert' and 'emissions' concerns... it does it the wrong way by being a private business instead of government programs. The left has no power over Wal*Mart, they cannot control what it does.

You cannot be in charge of a commission deciding who gets money and why if a private business answers all your problems. You can't control where the money goes and how the issues are dealt with. So you, as a leftist academic type, are left out of the loop, and that simply cannot be allowed.

Meanwhile, these stores should be a boon for local communities by making it cheaper and easier to get the food you need for your family. That doesn't mean Wal*Mart has no problems or flaws. It gets most of its cheep goods from brutal, often slave labor in China. It destroys local businesses, which is always sad. It is a corporate mindless model rather than something organic to the community (although they are working on that, sort of), and although it does offer jobs in a job-lacking economy, they are low end jobs.

But this is a great way to help communities and I'm glad to see someone took up the idea I had. Apparently I wasn't alone in imagining it.

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