Assignment # 1
Is Wal-Mart Good for America?
This documentary provides a challenging environment to the economy of America. This documentary shows a competitive relationship between producers and big retailers represented by Wal-Mart, who contribute to some of the American businesses becoming bankrupt and increasing the rate of unemployment. Wal-Mart came up with low-cost shopping at outsourcing at large sellers after lesser local companies. Those who are winners or losers are examined as discussed as shown here;
International retailers have superseded producers in decision making concerning the type, quality of products, and price.
They ensure that the Americans can afford to purchase Chinese goods which are low priced as compared to products made in America. This is a flaw of Chinese-United States trade relationship.
Wal-Mart has thousands of international suppliers with the largest percent being from China.
The largest producers of televisions in the whole world is TLC, which is a Chinese company and large quantity exported to the US go through Wal-Mart.
The America had billions of trade deficit from China which was expected to continue rising.
America imported processed goods from third world countries while it exported it raw material to such countries.
What did you notice at the Wal-Mart shareholders meeting? Do you think this is different from other shareholders' meetings? If yes, in what ways?
Stockholders meeting for Wal-Mart was held in an arena, with a large live audience of approximately fourteen thousand people. Meeting of corporate shareholders are not held in the arena. Wal-Mart held its annual meeting in Fayetteville, Ark that was full of magnificence and shareholders were treated to a whole new experience. This made this meeting be the largest conference in the world for the retailer.
Members of the audience were entertained with Pharrell Williams’s song Happy. A ceremonial dance was performed to represent international company reach. Williams took to the platform and reprised the universal radio smash. He asked all people present to clap for Wal-Mart for making the globe a happy place to live on his way off the platform.
Wal-Mart meeting of shareholders is relentlessly upbeat since celebrities like Harry Jr, Aloe Blacc, and Williams entertains the audience as presentations continue of company’s plans. The company continues to stress on business innovations to the model of Wal-Mart praising all their workers.
What organizational processes does Wal-Mart use to maintain a competitive advantage in its business? List the effects this has on Walmart’s suppliers?
Wal-Mart maintains one of biggest logistical and operational units. It stocks products from more than seventy countries and operates thousands of stores over twenty-seven countries around the globe. It also manages more than thirty-two billion US dollar in the organizational inventory system. It has an efficient and effective supply chain management system and plans. The whole system of the organization uses a model of driving costs out of chains of supply enabling clients to save their money and improve their living standards.
It began by providing clients with goods they wanted, when and where they needed them. It focused on improving cost structures and supply chain management plans allowing the company to offer low-priced products daily. This improved its competitions with other businesses hence assuming market leadership rank globally. Provided advantages to both the company and suppliers. These benefits include; improved competition advantage, increased market potential, low priced products, it reduced the cost of inventory, and it also developed the store and selections methods.
What is an opening price point? How does it influence sales?
It is a concept used by Wal-Mart which is the company’s effort to determine the lowest price in any goods they are dealing with. This concept has improved the power of bargaining between producers and retailers. Retaining have been commercialized and has become a large-scale business with very high productivity. Retailers have had much bargaining power to support their needs.
Wal-Mart started a campaign encouraging people to buy products that were made in America. What influence did this have on Wal-Mart's buying practices?
This does not affect Wal-Mart in any way except for the margins. Since Wal-Mart is known to sell their products at low prices, it is hard for customer’s preferences to be changed by words. It only set up trade barriers to prevent overflow of Chinese goods sold at low prices into the world market. To compete effectively, the Americans had to improve their operations and production. Wal-Mart controls its suppliers and has effective decision making.
List the arguments for outsourcing and against it.
Wal-Mart has increased production in the level retail trade. Employees in retail businesses work more which makes them sell more goods than before. Consumers can also get more products and low prices. Living standards have also improved due to rising wages.
Wal-Mart creates a surplus of consumer goods. Customers can get goods at lower prices. This is appealing to people especially low and middle-income earners. It also creates jobs. It employs more people to work in the company.
Jobs creation is profoundly affected by Wal-Mart functioning both locally where workers lose their jobs at the competitive companies. Also, it leads to decline in productions jobs in America since it is a big importer of goods. It is well documented that Wal-Mart pays it employees poorly. It does not provide health benefits such as insurance to their workers. These conditions need to be rectified.
It is also evident that it destroys local business wreaking havoc with local communities in different ways. It is also a burden to governments since it receives subsidies when it comes to communities, in the form of tax credits from the state. It is also becoming also a burden to taxpayers.
How would you describe Walmart’s business model? Who do you think gains the most from Wal-Mart's business model? Explain why.
Wal-Mart supply chain management method is different from the primary elements of supply chain management. These major elements being operations, purchasing, distribution. The retailers interlinked with Wal-Mart has defined methods. The purchasing managers determine the products to sell, sellers and come up with deals for the goods.
They forecast to estimate customers’ demands for a certain good depending on history and other external factors such as sales, competition and trend changes. They use demand planning to make accurate forecasts which are a vital step towards efficient inventory system. They ensure warehouse has enough and not too much to meet customer needs. Their supply chain interlinks the workflow and data obtained among all connectors to maximize efficiently.
This model yields low priced products and inventory which is better to control over store selection resulting to low prices goods sold to customers.
The customers’ benefits most since they can purchase products they want at lower prices instead of the high inflated prices. This leads to improved living standards of all people.
