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The Wal-Mart Effect : How the World's Most Powerful Company Really Works - and How It's Transforming the American Economy (Hardcover)
by Charles Fishman
| Category:
Corporate history, Corporate success, Entrepreneurship, Business |
| Market price: ¥ 288.00
MSL price:
¥ 258.00
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| MSL Pointer Review:
An excellent study of how Wal-Mart has affected America and the World. |
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Author: Charles Fishman
Publisher: The Penguin Press
Pub. in: January, 2006
ISBN: 1594200769
Pages: 304
Measurements: 9.4 x 6.8 x 1.1 inches
Origin of product: USA
Order code: BA00040
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- MSL Picks -
For those who are still existing under the misapprehension that Wal-Mart is a benign gentle giant, The Wal-Mart Effect is a startling expose.
For those of you already blown away by Fishman's revelationary Fast Company article, "The Wal-Mart You Don't Know," the book is not so much an expose as a calm-gone-turbulent ride downstream. At first you're drifting along, enjoying the still waters of Wal-Mart's earnest inception and formative years, soaking up the founder's sunny aspirations and the company's refreshing consumer-oriented mission and then before you know it, an oppressive darkness has enveloped you, a raging storm has rolled in, and you find yourself spinning helplessly in a cyclone at the edge of a 50-foot drop, trying to keep your head above water and find a way to get off. At book's end, you are no longer asking "How did we get here?" but rather "How do we get out?" and "Where do we go from here?"
In true journalistic form, Fishman takes painstaking efforts to present a balanced account, outlining the positives of Wal-Mart's effect - its cost savings for consumers, its distribution and packaging genius, its humble, no-frills headquarters and persona, and its even, unbiased expectations for all of its suppliers. But it is Fishman's disclosure of how Wal-Mart now achieves its low-price policy - the wave after wave of personal story after personal story of the struggling U.S. manufacturers and suppliers, their wage-starved or pink-slipped employees, bankrupted ethical competitors, tax-deprived towns, and overburdened social agencies wrecked in the Titan's tempestuous wake - that is the book's true mark of greatness.
Like a Steinbeck novel, The Wal-Mart Effect is profound in its simplicity. Fishman demonstrates an uncanny ability to make clear that which should already be obvious, but isn't; you open your eyes and say "How did I not see this before?!"
By focusing on Wal-Mart and the mentality it embodies, Fishman shines a brilliant spotlight on our American values - bargains over jobs; excess over ethics, the golden calf over the stony tablets.
If knowledge is power, "The Wal-Mart Effect" is Herculean in its potential to turn back the tide of American blind allegiance to low price at any cost. (From quoting K. Bachman, USA)
Target readers:
Executives, managers, entrepreneurs, government and non-profit leaders, professionals, academics and MBAs.
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He is a senior editor at Fast Company. His award-winning cover story on Wal-Mart generated the strongest reader response in the history of the magazine. In 2005, he was award the prestigious Gerald Loeb Award, the highest award in business journalism, for which he has been a finalist three times. Fisherman who has started his career at The Washington Post, has also been a senior editor at the Orlando Sentinel and the News & Observer. He has appeared regularly on NPR, CNN and Fox News.
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From the Publisher:
An award winning journalist reveals that what we know about Wal-Mart isn't even the half of the real story – The company is now so powerful that it has become a transformative economic force of unprecedented nature.
Americans spend $35 million every hour at Wal-Mart, twenty-four hours a day, every day of the year, 90 percent Americans live within fifteen miles of a Wal-Mart store. Wal-Mart is so familiar it has become a kind of national commons. But because Wal-Mart has maintained an impenetrable wall secrecy and imposed absolute compliance in that secrecy from those it does business with, we know astonishingly little about how the company actually operates or about its impact on our lives.
Acclaimed business journalist Charles Fishman has penetrated Wal-Mart wall of secrecy, gaining the first in-depth and truly revealing access to a host of Wal-Mart former executives as well as managers at leading brand companies that sell to Wal-Mart, and digging up the fascinating and unexpected untold story of "the Wal-Mart effect". In this lively and hard-hitting investigation, he takes us an unprecedented behind-the-scenes expedition deep inside many worlds of Wal-Mart and uncovers the hidden nature, and the remarkable extent, of the company's power.
The Wal-Mart Effect reveals the astounding array of ways in which the company is reshaping the terms of business; the economics of our communities; the lives of factory workers, both in the United States and around the world; and even the entire U.S. economy. Taking us inside Bentonville, Arkansas, headquarters, on to the factory floors, and into the stores themselves in a way we've never shopped them before, Fishman has discovered how Wal-Mart brings prices down so dramatically and what the remarkable payoffs and how costs of those "everyday low prices" really are.
Is the company a good thing or a bad thing? Fishman shows that this question doesn't even begin to address what we need to know about Wal-Mart. Not only is Wal-Mart the most powerful company in the world, he says, but it has become so powerful that it reaches into executive suits and onto factory floors and sets the terms for the ways companies do their business, exacting enormous efficiencies but also shifting costs onto suppliers and forcing some to the brink of bankruptcy, Wal-Mart claims that it is a leading creator of new jobs, but Fishman's careful analysis shows that, in fact, most of the company’s "new" jobs come at the expense of jobs at other retailers. So profound is the effect on local businesses when Wal-Mart moves into town that one study has shown that the company may actually causes poverty. And yet the best estimates indicate that Wal-Mart saved American consumers $30 billion in 2004, and expert analysis has shown that the company has significantly lowered the rate of inflation in the United States. No company is more reviled, and yet no company is also so revered.
Wal-Mart is not just a retailer anymore. Fishman argues that the company has become a kind of economic ecosystem, and anyone who wants to understand the forces shaping our world today must understand the hidden reach and transformative power that is "the Wal-Mart Effect".
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Starting in the early 1990, a change swept through a line of products that most adult Americans use everyday. Until then, nearly every brand and style of deodorant – roll-on and solid, powder-fresh and unscented – came in a paperboard box. You open the box, pulled out the container of deodorant, and pitched the box in the garbage,. In the early 1990, Wal-Mart, among other retailers, decided the paperboard box was a waste. It added nothing to the customer's deodorant experience. The product already came in a can or a plastic container that was at least as tough as the box, if not tougher. The box took up shelf space. It wasted the cardboard. Shipping the weight of the cardboard wasted fuel. The box itself cost money to design, to produce – it even cost money to put deodorant inside the box, just so the customer could take it out. With the kind of quiet but irresistible force that Wal-Mart can apply, the retailer asked the deodorant makers to eliminate the box. Unbox the antiperspirant.
The box turned out to cost about a nickel for every container of deodorant. Wal-Mart typically split the savings – letting deodorant makers keeping a couple along to its antiperspirant customers.
Walk into a Wal-Mart today, and pause in the deodorant aisle: eight shelves of deodorant, sixty containers across. In a well-tended Wal-Mart store, nearly five hundred deodorant face you. Not one box. Walk into any store now, Walgreens ,Target, Eckerd, and CVS, go to the deodorant aisle. Not one box.
Whole forests have not fallen in part because of the decision made in the Wal-Mart home office at the intersection of Walton Boulevard and SW 8th Street in Bentonville, Arkansas, to eliminate the box. The nickel savings may seem trivial, until you do the math. With two hundred million adults in United States, if you only account for the nickel on the container of deodorant in the medicine cabinet right now, that's a savings of $10 million, of which customers got to keep half, $5 million, just for one small change, unnoticed by customers, more than a decade ago. But the change, and the savings, is recurrent, and permanent. We're saving $5 million in nickels five or six times a year – as often as we need a new container of deodorant. The nation has saved hundreds of millions of dollars since the deodorant box disappeared. It's a perfect Wal-Mart moment – the company used its insight and its muscle to help change the world. Millions of trees were not cut down, acres of cardboard were not manufactured only to be discarded, one billion deodorant boxes didn't end up in landfills each year. It's all unseen, all unnoticed, and all good.
Unless, of course, you were in the paper-board-box making business. That couple years where you took a call from every single deodorant maker in America, with each one canceling their standing order for boxes, those were tough times.
Wal-Mart changes the world like that every day, and has been for fifty years. A wasteful routine, often long entrenched, is detected and eliminated, establishing a new standard of efficiency, lowering costs for everyone, especially ordinary customers. And in a wake of the change comes a ripple of unintended consequences, or if not quite unintended, at least unacknowledged. That is the Wal-Mart Effect – the ways both small and profound that Wal-Mart has changed business, work, the shape and well-being of the communities, and everyday life in the United States and around the world.
At about the same time deodorant was coming out of the box, Wal-Mart was experimenting with the idea of doubling the size of some of the new stores in order to start selling groceries alongside general merchandise in a format it called supercenters.
Ten years later, at the end of 2000, Wal-Mart had 888 supercenters – it had opened an average of 7 new supercenters a month, 120 months in a row – and Wal-Mart was the number-one food retailer in the nation. In little more than a decade, from a standing start, Wal-Mart mastered U.S. grocery business and remade what turn out to be a complacent industry in its wake. It is an astonishing achievement. Today Wal-Mart sells more groceries than any company not just in United States but in the world; it has 1,906 supercenters, 1,000 more than it had five years ago. That is, in the last five years, having already conquered the supermarket business, Wal-Mart has dramatically increased the pace of its grocery invasion; it has opened an average of 16 new supercenters a month for five years.
In grocery, as in other areas of retailer, Wal-Mart isn't just the first among equals; it is unchallenged. The company that essentially didn't exist as a grocer fifteen years ago now sells more food than Kroger and Safeway combined. Nationwide, Wal-Mart has 16 percent of the grocery market. In many individual cities, though, it has 25 or 30 percent of the grocery market – one out of four, or one of the three families do their food shopping at Wal-Mart.
Wal-Mart's grocery departments – in supercenters, about 14 percent of the floor space is devoted to groceries – are not particularly appealing place to shop. The aisles are long, the staffing is thin, the stocking often spotty and chaotic, the produce ample but undistinguished. But when Wal-Mart starts selling groceries in a new city – Dallas, Memphis, Oklahoma City, it quickly wins business in a simple, potent way: Its prices are about 15 percent lower on exactly the same foods sold elsewhere. You can buy fresh salmon from Wal-Mart sea-food display case for $4.84 a pound, a price so low it almost seems too good to be true. For a family of four who might spend $500.00 a month on groceries, Wal-Mart 15 percent lower prices translates into savings of hundreds of dollars a year, just for driving to a different store.
Wal-Mart didn't just change the lives and spending habits of grocery shoppers, though. It changed the very ecosystem and rhythm of the supermarket business, often with devastating consequences for those who couldn't adjust. In the same decade that Wal-Mart has come to dominant grocery business in United States, thirty-one supermarket chains have sought bankruptcy protection; twenty-seven of them have cite competition from Wal-Mart as a factor. That, too, is the Wal-Mart effect.
Wal-Mart isn't just a store, or a huge company, or a phenomenon anymore. Wal-Mart shapes where we shop, the products we buy, and the prices we pay – even for those of us who never shop there. It reaches deep inside the operations of the companies that supply it and changes not only what they sell, but also changes how the products are packaged and presented, what the lives of factory workers who make the products are like – it even sometimes changes the countries where those factories are located. Wal-Mart reaches around the globe, shaping the work and lives of people who make toys in China, or raise salmon in Chile, or sew shirts in Bangladesh, even though they may not visit a Wal-Mart store in their lives.
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USA Today (MSL quote), USA
<2006-12-26 00:00>
The Wal-Mart Effect is an interesting look at how big corporations affect our planet in positive and negative ways. |
Baltimore Sun (MSL quote), USA
<2006-12-26 00:00>
...a fascinating dissection of the most controversial corporation in America today. |
The Christian Science Monitor (MSL quote), USA
<2006-12-26 00:00>
The Wal-Mart Effect saunters through the influential economic ‘ecosystem’ that the discount chain represents with clarity, compelling nuance, and refreshing objectivity. |
The Washington Post (MSL quote), USA
<2006-12-26 00:00>
A must-read if one is even to begin understanding the global dominance of Wal-Mart. |
View all 14 comments |
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