Walmart Case Study

By most accounts Walmart is among the most successful companies in the world. Its revenues for $2007$ were $$379$ billion, more than five times larger than the next largest retailer, Target. For comparison, in the same year Saudi Arabia was ranked by the World Bank as the $24$th largest economy in the world with an estimated gross domestic product $($GDP$)$ of $$381$ billion and Switzerland was ranked $22$nd with a GDP of $$415$ billion. Walmart operates almost $7,300$ stores, and over $4,000$ of them are in the United States. It is estimated that $200$ million people shop at Walmart each week. Worldwide, Walmart employs $2$ million people. It is the largest private employer in the United States and the single largest employer in $25$ separate U$.$S$.$ states. Walmart was founded in the early $1960$ s by Sam Walton in Rogers, Arkansas.

Walton's original marketing strategy was to emphasize low prices, and this strategy continues today as reflected in its marketing campaign of "everyday low prices." Walmart is able to achieve low retail prices by leveraging its buying power as the world's largest retailer and by controlling labor costs. Walmart sells more socks, toothpaste, dog food, sporting goods, guns, diamonds, and groceries than any other business in the world. Alone, it accounts for the sale of $30$ percent of all household goods $($laundry detergent, soap, paper towels$)$ and $15$ percent of all CDs$,$ as well as $28$ percent of Dial soap's total sales, $24$ percent of Del Monte Foods', $23$ percent of Clorox's, and $23$ percent of Revlon's. Walmart is the single largest importer from China, accounting for almost $10$ percent of all Chinese imports to the United States, worth an estimated $$12$ billion in $2002.$ At first glance, Walmart's success promotes a number of values. Stockholders have received significant financial benefits from Walmart. Consumers also receive financial benefits in the form of low prices, employees benefit from having jobs, many businesses benefit from supplying Walmart with goods and services, and communities benefit from tax$-$paying corporate citizens. Walmart cites several other values that it promotes in its own self$-$description.

Walmart describes itself as a business that "was built upon a foundation of honesty, respect, fairness and integrity." What is described as the "Walmart culture" is based on three basic beliefs attributed to founder Sam Walton: respect for individuals, service to customers, and striving for excellence. Despite this, not everyone agrees that Walmart lives up to high ethical standards. Critics portray Walmart as among the least admired corporations in the world. Ethical criticisms have been raised against Walmart on behalf of

every major constituency$-$customers, employees, suppliers, competitors, communities$-$with whom Walmart interacts. For example, some critics charge that Walmart's low$-$priced goods, and even their placement within stores, are a ploy to entice customers to purchase more and higher$-$priced goods. Such critics charge Walmart with deceptive and manipulative pricing and marketing. Perhaps the greatest ethical criticisms of Walmart have involved treatment of workers. Walmart is well known for its aggressive practices aimed at controlling labor costs. Walmart argues that this is part of its strategy to offer the lowest possible prices to consumers. By controlling labor costs through wages, minimum work hours, and high productivity, and by keeping unions away, Walmart is able to offer consumers the lowest everyday prices. Walmart has also been accused of illegally requiring employees to work overtime without pay and to work off the clock.

Employees in Wisconsin, Michigan, Missouri, Kansas, Ohio, Washington, Illinois, West Virginia, and lowa have fi led lawsuits alleging such illegal labor practices. Walmart has also been accused of obstructing employees' attempts to organize unions. The National Labor Relations Board fi led suit against Walmart stores in Pennsylyania and Texas charging illegal antiunion activities. Maine's Department of Labor fined Walmart for violating child labor laws, finding $1\mathrm{.}436$ child labor law infractions in some $20$ different Waimart stores, Walmart has also been sued in Missouri, California, Arkansas, and Arizona for violating the Americans with Disabiluties Act.

Aoswer the following questions. There are $6$ questions in total: