In addition, the company does not "own" most of their inventory. Because of their huge volume, OEM's consign much of the inventory and are paid when it sells. In the words of Don Tapscott, author of the fantastic Digital Economy, "Wall Mart owns the product only for a nanosecond, as it passes through the checkout scanner." This is great for Wall Mart, but bad for the supplier who needs to front manufacturing and transportation costs of extremely large orders.

They are a notoriously tough buyer. A colleague who is a VP at a major grain products company told me that Wall Mart and Sam's Club will purchase by the multiple rail car load, but with extremely short notice and at a very low price. If the supplier is not willing to bend over backwards, by putting their bulk order ahead of everyone else's order, then too bad.

I used to work for a supply chain consulting firm, and we often told medium-sized business who were trying to get their products into the Wall Mart system that this could be the worst thing that ever happened to them. Wall Mart demands absolute first preference from a supplier, in huge volume, at extremely high service levels -- and at very low margin. For companies like Coca Cola, who can handle these huge orders and rail shipments in stride, the large volume may well be worth the lower margin. For many companies, however, the "cost to serve" Wall Mart means that they can't sell to them profitably. Basically, it is a more expensive customer to serve, and they demand lower prices for the priviledge.

I agree with what others have said that it is a horrible shopping experience, and I simply won't go there. The true democracy of America is the consumer dollar though, and millions have voted the likes of Wall Mart and Home Depot into the positions they enjoy.

Wall Mart does so many things right: incredibly efficient distribution, the toughest purchasing in the world, and stellar use of technology (for a long time, Wall Mart owned the largest telephony switching system in the SE United States). They invest where they need to, in distribution automation and information systems, and cut corners everwhere else they can get away with it. The fact of the matter is that they do what they were "elected" to do extremely well. From this point of view, Wall Mart is one of the best run companies in the world. Will people realize that "the game is not worth the candle?" Certainly this is what the documentary makers are hoping.

I don't think its *necessarily* bad for communities or the country, but it shows what you get when cost is the only factor for people: low quality, poor service, bad worker relationships, bad supplier relationships, oh -- and low prices. The important thing to remember is that people seem to want this. These documentaries exist because some people don't want it, and they believe that others won't once they understand the "high cost of low price." I think this is naieve, but whatever. I doubt that the opponents of Wall Mart are the nation's poor...

Another extremely well-run company has the exact opposite approach: Barnes and Noble. This company charges more for its products, but provides a pleasing atmosphere for people. This is the other side of retailing: the retailer as entertainer. Among non-drinking people, this store has actually become a pickup scene. A retail store!

Since there will *always* be fewer high-income persons than low-income persons, the Barnes and Noble model will only work in large population centers where a sufficient market critical mass exists. On the other hand, the poor are everywhere in sufficient numbers to make a Wall Mart profitable.

Jim