WALMART VS UNIONIZATION

Walmart vs Unionization

Abstract

Throughout the lifespan of this retail giant, Wal-Mart has caused much grief and many savings to the people who work and shop there respectively. To the people who shop there, there is no place better to find cheap goods from every department. However, to the people who work there, it is a totally different scenario. Behind the great savings is where the real controversy lies. Wal-Mart displays an image of happy workers and happy consumers. This is contrary to the truth because many Wal-Mart employees are not happy, but just scared to say so. Over all of this controversy a few people see a change in the wind for Wal-Mart. Phillip Gailey explains, what he believes, as better union and Wal-Mart relation. Gailey argues that unions are starting to change their tactics and the Wal-Mart executives are responding positively.

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Walmart vs Unionization

Intro to Walmart

Walmart is the largest external competitor of the Supermarkets and Grocery Stores industry. Many consumers do their grocery and supermarket shopping at Walmart supercenters, even though the company is classified within the Warehouse and Supercenters industry. The company has 2,746 Supercenters in the United States and most are open 24 hours. Supercenters average 187,000 square feet and retail a wide assortment of general merchandise and groceries (Blecher, 2008, p 6). Walmart has been focusing on expanding their grocery segment over the past five years which has drawn customers away from traditional supermarkets. In fiscal 2010, groceries accounted for 54% of the store's revenue compared to 39% in fiscal 2006.

Walmart Stores is the world's largest retailer and grocery chain by sales. According to its annual report, the company generated consolidated revenue of $419.0 billion in fiscal 2010 (latest annual data available) through its 8,970 stores worldwide (Chan, 2007, p 86; Ailawadi, Zhang, Krishna & Kruger, 2010, p 593; Ailawadi, Zhang, Krishna & Kruger, 2010, p 593). The company leverages its massive size to exert high buying power to its suppliers; as such, it can obtain significant cost savings and pass them down to consumers in form of heavily discounted prices.

Walmart operates three separate divisions: Walmart US, representing 62.1% of revenue and 42.4% of establishments; Sam's Club, representing 11.8% of revenue and 6.8% of establishments; and Walmart International, representing 26.1% of revenue and 50.8% of establishments. Under the Walmart US division, the company runs Supercenters that offer general merchandise and a full-line supermarket as well as general discount stores that offer the same products but no perishable groceries (DeMarco & Matusitz, 2011, p 131; Chen, Kacperczyk & Ortiz-Molina, 2011, p 28). Only Walmart US's general discount stores represent major players within the industry; the retailer's remaining operation (including Supercenters) is accounted in the Warehouse Clubs and Supercenters industry.

Walmart's first discount store opened in 1946 with the name of Wal-Mart Discount City. Today, there are more than 800 discount stores in the United States and most are open 24 hours (Carden, Courtemanche & Meiners, 2009, p 6). General discount stores retail a wide assortment of general merchandise, ...