Wal-Mart Challenged by Unions, Lawyers

Wal-Mart is increasingly under attack in communities that have invited Wal-Mart to locate there, by outsiders, mostly representing labor unions, legal advocy groups such as ACORN, and trial lawyers.
This article describes some of the innovations that Wal-Mart has brought to retailing. Their philosophy has been to lower prices by lowering costs and lowering their own profit margin. They have lowered costs through technological innovation and good management.
Wal-Mart's pricing strategy has forced competitors to lower prices as well, whidc results in jobs being created elsewhere:

But the Lefts case ignores the greater benefit that an efficient operator like Wal-Mart brings to shoppers and an entire economy by driving down prices and forcing other stores to perform better. A Wal-Mart-sponsored study, undertaken by the Los Angeles County Economic Development Corporation, estimates that Wal-Marts entry into the local market would save county shoppers about $1.78 billion annually and southern California shoppers $3.76 billion annually, or nearly $600 per household. Shoppers would redirect those savings, the LAEDC says, into other uses that could create up to 36,000 new jobs, more than offsetting the estimated loss of 3,000 to 5,000 jobs resulting from a drop in the grocery-industry wage pool.

Robert Blumen

Robert Blumen is an independent software developer based in San Francisco, California