We may know a little more about Wal-Mart since this book was published in 2006. But perhaps not that terribly much.
The author, (Charles Fishman), seems to have – as do many others including myself – a love/hate relationship and fascination with this company. There can be little doubt they’ve revolutionized supply chain logistics, brought down the cost of products across many categories and re-defined just what “big box” retailing means. What’s less clear is if this is really good or not.
While one can hardly fault a company for seeking efficiencies – of scale or otherwise – there’s serious questions raised about potential hidden costs of the Wal-Mart Effect. Low wages and their consequences for both workers, (sub-standard incomes), and society, (gainfully employed workers needing public assistance health insurance and other services), are one aspect of potential negative effects. (Though it’s hard to confirm the truth of this.) Then there are environmental issues and worker effects in foreign countries. (The author recounts issues regarding Chilean salmon farming and how pushing for supplier price concessions may result in sub-standard environmental and employment practices.) Lastly, there’s the quality argument. In the race to the bottom for prices, suppliers cutting costs to the bone may skimp on quality to the point where goods are so cheap, they’re poorly made but inexpensive enough to be considered disposable.
Meanwhile, millions of families save billions of dollars on grocery bills.
So… is the company good or bad or like anything else a little or a lot of both?
Regardless of the actual answers which may be shrouded by lack of data, Fishman is asking some interesting questions. Even though the book may be getting a bit dated at this point, it’s worth a read for anyone working in consumer packaged goods or otherwise affected industries.