Fortune.com has an article about Wal-Mart up entitled “One Nation Under Wal-Mart”.
I have always admired Wal-Mart for its ruthless application of reason to retail. While other companies used higher margins to fatten their bottom lines, Wal-Mart focused on passing the margins on to its customers and using its dizzying volume to make up the difference. It then negotiated ever-lower prices and streamlined its operations to eliminate every penny of waste it could control. My in-laws once had an opportunity to work with Wal-Mart but decided against it when they saw the terms that Wal-Mart demanded—they just couldn’t meet them and make a profit.
Slowly but surely it has entered new markets and dominated them by sheer force of will:
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Only ten years after launching its food business amid much guffawing, Wal-Mart is the world’s biggest grocer, driving down prices an average of 13% in the markets it enters, according to a UBS Warburg study. The effect has been seismic: Kroger has gone on a cost-cutting drive to narrow the price gap, Albertsons has abandoned some markets entirely, and an army of consultants now advise grocers on how to grapple with the 800-pound gorilla. When Wal-Mart moves, it adheres to the Powell doctrine of overwhelming force.
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The article offers a blizzard of statistics to show Wal-Mart’s impressive growth and dominance, but I liked its conclusion best for such a demonstration:
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It’s more than a little reminiscent of another fledgling republic that became a superpower and discovered to its shock that much of the world saw it as an imperial bully. Admired and resented, imitated and vilifed, envied and feared: One Nation, Under Wal-Mart.
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