Monday, February 26, 2007

The Wal-Mart Effect (2)

"[Hanes] conluded, says Caldwell, 'people just had more underwear in their house than they really needed, or had had in the past.' The underwear was so cheap, and so irresistably displayed on those pallets, that people just bought it and took it home. That kind of consumption doesn't trouble Caldwell at all - his job was to sell underwear. It's always nice to have a fresh pair of athletic socks, of course, but consumption driven strictly by price and impulse - consumption that answers no need at all - well, that's curious. Wal-Mart was saving its customers money, and they were tucking the savings away in the underwear drawer." (pg 70)

"(Lingerie maker Frank) Garson says for the wages of a single U.S. factory worker, competitors could hire seventy people in indonesia." (pg 97)

"'No matter how hard they work, how fast they get it done, how much improved the quality is, it's never good enough with Wal-Mart. The idea of a 'satisfied customer' was, for them, an oxymoron. It just doesn't happen. It doesn't compute."
That's why Ford says, 'When you see the Wal-Mart smiley face, whistling and knocking down prices, somewhere there's a factory worker being kicked in the stomach.'" (pg 99)

"'They've lowered the price of the TVs to the point where they can't afford to pay $1 or $2 an hour they have to pay in Mexico.'" (pg 100)

"'People say, how can it be bad for things to come into the United States cheaply? How can it be bad to have bargains,' says Dobbins. 'But you can't buy anything if you're not employed. We are shopping ourselves out of jobs." More than that, says Dobbins, the manufactured goods coming to the United States so cheaply are made under factory conditions that would not only not be tolerated in the United States, they likely wouldn't even be legal.'
'We want clean air, clean water, good living conditions, the best health care in the world,' says Dobbins. 'Yet we aren't willing to pay for anything manufactured under those restrictions." (pg 103)

"'The cost structure of operating manufacturing plants in the United States is just enormously out of sync with what people want to pay. Dramatically.'" (pg 104)

"Eventually, there are no more efficiencies to be wrung out of the supply chain; there are no more pennies to be saved with smarter distribution or reduced pakaging or cheaper plastic. Eventually, the only way to lower costs is to manufacture products outside the United States, in countries with lower labor costs, fewer regulations, less overhead. This element of the Wal-Mart effect remains largely hidden from public view" (pg 106)

"In 2003, for the first time in modern U.S. history, the number of Americans working in retail, (14.9 million) was greater than the number of Americans working in factories (14.5 million). We have more people working in stores than we do making the merchandise to put in them." (pg 108)

"Consumer spending, however, accounts for two thirds of the U.S. economy." (pg 108)

Saturday, February 24, 2007

The Wal-Mart Effect (1)

"Wal-Mart has recently taken to explaining that retail jobs like those it offers, although paying double the minimum wage, are nonetheless intended as supplemental income, not as support for a family. The problem with that is that for two thirds of Americans, Wal-Mart is the single largest employer in the state where they live." (pg 15)

"From one side of the country to the other, there are dozens of lawsuits alleging that store managers routinely forced hourly employess to punch out at the time clock, then return to work, putting in hours of unpaid labor. Wal-Mart recently settled a federal investigation of its use if hundreds of illegal aliens to clean its stores, making a record-setting payment to the federal government. The company faces the largest class action lawsuit in history: the sex discrimination suit on behalf of 1.6 million current and former female employees that alleges that Wal-Mart managers systematically underpaid women and denied them promotions. A front-page story in the New York Times in 2004 revealed Wal-Mart's routine practice of locking employees inside about 10 percent of its stores overnight, a practice the company altered even before the Times could publish the story." (pg 27) (note: this case is ongoing)

"Even if you assume that Wal-Mart and its competitors are hiring equally talented staff - which is not a safe assumption - the standard Wal-Mart headquarters staffer is working at least 15 percent more hours in a routine week, even if his or her competitors are logging fifty hours." (pg 30)

"Sam valued every penny" (pg 30)

"Sam was a workaholic" (pg 31)

"In August 2004, a union was certified at a Wal-Mart store in Quebec, and it was authorized to negotiate a labor contract with Wal-Mart on behalf of the store's 190 employees. Ten months later Wal-Mart closed the 130,000 square foot store in Jonquiere, laying off all the associates. In eleven years of doing business in Canada, where Wal-Mart is the largest retailer, the company had never permanently closed a store. A Wal-Mart spokesperson said simply that the union's contract demands would have required the store to add thrity new jobs - a 15 percent increase in payroll for a company that operates on a 3 percent profit margin." (pg 48)