(no subject)

[weaktwos]

I love Frontline, it is a thought provoking program. This week's episode features the story of Walmart, and how powerful they are. I dislike Walmart, but their business model is packing quite a wallop in the retail theater. It also showed how their pricing strategy helped to strap Rubbermaid.

I don't know how I feel about this. I think Rubbermaid needed to revamp their product line to remain competitive, if it is true that the cost of resin compelled rubbermaid to raise their prices in order to continue to be profitable. Walmart, being Rubbermaid's biggest buyer, didn't want to pay the higher price, or charge a higher price for the product. Apparently, consumers didn't miss the product. Capitalism just isn't warm and fuzzy.

But make a note of this: Walmart isn't necessarily always the cheapest. Keep an eye out. They have "loss leaders" that they advertise, but all their products are not necessarily competitive. But by advertising the lowest, rock bottom price for item X, you get the perception they are the lowest price on all of their products.

This is a process probably practiced by others, so keep an eye out.

Comments

[ybunny.livejournal.com]

*nodsnods* as a consumer I have noticed this between all the supermarkets chains in the uk. so you could probably get the basics for next to nothing if you don't mind traveling to all the supermarkets. but who wants to do that.

[weaktwos.livejournal.com]

Aye, but I think the process is similar to buying cars. They have a "Loss-leader" that they sell on a slim margin, but that product doesn't have all the features you want, so you buy another model that could be aquired cheaper elsewhere.

I personally cannot stand to go into Walmart. It's wall-to-wall crap.