Wal-Mart is the place where I shop for my weekly groceries. Since I am an average penny –conscious consumer, I not only like the store, I do love it. The Wal-Mart store in our area has shaped and changed the behaviour of local consumers. Goods have been more accessible and affordable to residents with the advent of the largest retailer chain. Anything from clothes to fresh vegetables and canned goods can be purchased in just one location, at very cheap prices. It is true that Wal-Mart had uprooted smaller retailers.
But, the savings it generated for the average shopper actually compensated for its negative impact. Its business model focuses on cost-cutting from the supplier level. Wal-Mart has undeniably become too powerful. The Wal-Mart effect is now a byword for economic changes that the retail giant had spawned. In fact, “Wal-Mart reaches around the globe, shaping the work and the lives of people who make toys in China, or raise salmon in Chile, or sew shirts in Bangladesh, even though they may never visit a Wal-Mart store in their lives” (Fishman, 2006).
Wal-Mart’s decisions influence wages, especially boosted by its anti-union stance. The average hourly rate of sales clerks was driven down, in an effort to compete with the low prices offered by Wal-Mart . Factories have also chosen to relocate abroad, to take advantage of cheaper production costs. Wal-Mart’s dominance is reminiscent of Microsoft’s software monopoly. Its retail clout did not only reshape the way shoppers evaluate similar products—based on price—but it also reshaped the economy, by suppressing inflation.
From an economic perspective, opposition to Wal-Mart’s expansion is clearly a violation of the free market enterprise. The company has every right to look for new locations and spread its operations. In theory, Wal-Mart can build stores, as many as it is capable of. However, given the current economic situation, the government should actually police the market. As mentioned above, Wal-Mart drove factories abroad, in a bid to deliver cheaper priced products. In effect, jobs have also fled. The average American has become a consumer without a job.