Reply #53: I worked at the store in Avondale, AZ for 13 months [View All]

[Tansy_Gold]

The department managers were assigned the task of "comparison shopping" on a routine basis. They went to other store in other chains -- Target, K-Mart, Walgreens, Price Club, etc. -- with a list of typical items and brand names. They did this approximately once every two weeks, depending on the volume of business.

They compared the prices in the other stores to the prices in the WalMart store where they worked, not to any standard WalMart price. Upon their return from their shopping trip -- they never bought anything, and were frequently kicked out of stores that caught them "comparison shopping" -- they marked everythign on their list down so that their (I refuse to call it "our") WalMart had lower prices than the competition. They would then find other items in their department to mark up, by a few cents.

The objective was to lure people into the store with extremely low prices on certain items, then jack the price up on a few others so that it would be just a tiny bit higher than the competition. The strategy was to sucker people into thinking that they were saving soooooo much on a bottle of Head & Shoulders shampoo -- "Look, Stanley, only $1.98! It's $3.49 at Walgreens. What a bargain!" -- that they won't notice they're paying a tiny bit more for hand lotion, a tiny bit more for toothpaste, a tiny bit more for toilet tissue. And over the long run, the loss-leader costs are more than made up for by the pennies here and there on other items.

WalMart has one of the most complex and detailed computer software for analyzing customer buying habits anywhere in the world. They know whaat people buy and they know at what price they will be induced to buy more. The Vlasic pickle story is classic WalMart strategy. Sucker the buyers in with #2.49/gal pickles, and they'll spend the savings on potato chips and soda. Even if they know they're paying more, they rationalize that it's cheaper than getting in the car and driving to another store. That's why WalMart is so intent on building these supercenters. They will have the shopper "trapped" into doing all his/her shopping in one place. The "convenience" will outweigh the slightly higher prices.

And when they are suckered into spending more money at WalMart, they will have less left over to spend anywhere else.

I used to listen to people wander through the store -- and WalMarts are always laid out so that people have to wander up and down the aisles to get to the door -- and hear them say things like, "Oh, look, we really don't need this, but it's such a good price!" They buoght things they didn't need and often didn't even want, but it was a good price.

Now, I'm sure one of our rightwing, self-discipline and self-responsiblity trolls will come up with a comment like "WEll, it's their own fault!" but the point is that in a capitalistic economy, the point of capitalism is to get people to buy buy buy buy buy. That's why we have advertising agencies, commercial, endorsements by celebrities, etc. People are only doing what the system wants them to do. If they didn't, I imagine our right-wing folks would call them communists, subversives, anti-American traitors!

(Feel free to call me all of the above. I am not a shopaholic and never will be.)

So to me it seems absurd for someone to say people ought not
to buy the things that keep the economy going. You can't have your cake and eat it too. Which is what the WalMart strategy is based on.

But it's also based on a culture of waste. That's the philosophy behind the gallon of Vlasic pickles and the whole Sam's Club concept. Buy more for less, but waste half of it and come back for more. In the end, the consumer pays more for what he/she actually consumed than if they had bought only what they needed. But again, that's the whole philosophy of capitalism -- you have to keep buying more. (In that sense, it's rather like some metaPonzi scheme, but don't get me started. . . . )

I can give you another example from personal experience of how WalMart screws its suppliers.

Several years ago, WalMart entered into an agreement with Kensington Publishing, a New York paperback publisher of popular fiction, mostly romance novels. Kensington would publish a line of inexpensive romance novels that would be marketed exclusively through WalMart. The authors would sell ALL RIGHTS to the books, receive no royalties, have no control over the publishing. If I remember correctly, these little novels were called "Gems." Some friends of mine signed one of these "gems" of a contract: for their books they received a grand total of $1000. Th big suckering, er, selling point was that thousands upon thousands upon thousands of copies of their books would be in WalMarts all over the country. Wonderful advertising and promotion! They would become household names!

Not.

The books were given some prominent display, then when they didn't move fast enough, they were bundled and sold 4 for $1. Readers finally started buying them, but at a price that low, they would read them and throw them away. (I know, because I found a lot of them in the trash!) EVen at the deep-discount price, WalMart made a profit. So did Kensington. Only the writers got screwed.

(Authors generally get screwed big-time when their books are purchased at huge discounts by the pseudo-wholesale chains like Price Club, Costco, etc. But don't get me started. . . )

WalMart's low pricing policies do NOT benefit shoppers. They do NOT benefit workers. They only benefit the stockholders and the Walton family parasites.

Tansy Gold, who hates WalMart with a purple passion so intense she isn't even going to proofread this post