Bacon's Rebellion

Democracy Thrives in Sunlight

ON WAL*MART

—

by

James A. Bacon
in

At a party over weekend a regular reader of BR suggested that EMR needs to go back and make sure that a failure to respond to some of Larry’s “summaries” does not suggest Larry is right or that there is no sound counter argument.

As luck would have it, even though EMR has been very busy, he has copied some of the more important ones and will re-post the comments and respond as time allows.

Here is a recent comment from Larry that was posted on Jim Bacon’s new Blog The Retirement Crisis. Jim is so prolific that if one does not respond right away the comment is buried. This post was the topic of settlement patterns, not Boomers retiring so EMR pulled it over here out of the fast lane.

In the 22 May Malls: the Ticking Time Bomb post on Empty Malls Larry said:

“I dunno EMR.. I strongly suspect when the dust clears – the WalMarts are going to still be around.”

First, what causes you to come to the conclusion that the dust will clear?

But to make sure the issue is clear:

Over the past decade Wal*Mart would not have shown a profit if all the location-variable costs were fairly allocated and Wal*Mart was not subsidized directly and indirectly. We lay this all out in PART THREE – THE PROBLEM WITH CARS – Chapter 10 – Learning from Big Boxes. There is now some good research on the issue.

That is only the start. Wal*Mart is not the cheapest place to buy a lot of items. One member of our Household recently paid 46 percent more per square foot for a product by the same manufacturer (different size package) in Wal*Mart as another member paid on the same day at Sears (nee Kmart). We use a lot of it and both knew we were getting low.

Wal*Mart is cheap on SOME things but they make it up on the items that their research shows customers will ALSO buy when they go to Wal*Mart for an advertised bargain or an item that is frequently price compared. They use package size and other factors to make things appear cheaper than they are.

Wal*Mart did not become the largest Enterprise in the US of A (for a while) by giving anything away.

For a quick confirmation go to Wegmans and check out their comparison shopping posters updated every few days – Wal*Mart, Costco, Giant, Safeway, Wegmans – milk, bread, etc.

Finally Wal*Mart us rolling out small (15,000 sq ft) shops so they can be closer to the customers because some shoppers have started to baulk at driving long distances to their super stores. Did someone say Balanced components of human settlement.

“To me.. they are like king-sized, modern-day versions of the old mom&pop country stores….”

You can only say that because you have not yet come to grips with locational and scale reality.

“We’ll know that we REALLY are in trouble when WalMarts start going belly-up… right?”

One would hope most realize that humans are “in trouble” now even if Wal*Marts are still showing a profit due to subsidy.

EMR

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32 responses to “ON WAL*MART”

  1. Larry G Avatar
    Larry G

    re: "Finally Wal*Mart us rolling out small (15,000 sq ft) shops so they can be closer to the customers because some shoppers have started to baulk at driving long distances to their super stores. Did someone say Balanced components of human settlement. "

    can you say Dollar General or Family Dollar ?

    check the out if you think Walmart is the number one purveyor of "cheap" Chinese goods!

    So.. EMR will be happy when WalMart starts building stores like Dollar General/Family Dollar?

    Here's what you can say about WalMart whether you love them or hate them…

    they are one of the most agile of the retail marketers.

    and yes.. they are not always cheaper.. and yes.. they'll get you in the door for the cheap ___ and then "upgrade" you on some other items … found cheaper elsewhere – agreed and that's why I'll swing by Dollar General to deal with that issue.

    …but don't forget "quality" and "value" either.

    there is cheap and there is CHEAP!

    but where I tweak EMR – is the things that enable WalMart to be who it is – and that is a thoroughly evolved and modern logistics supply chain.

    The Mom&Pops ALSO used a supply chain… the'd have olives from Spain and Silk from the other side of the world.. and it would come by boat and wagon and later by rail.. and now by tractor trailer coming out of huge intermodal distribution centers…

    so we have an much better optimized supply chain that utilizes many different transport modes… the very last part of which is …essentially a computer-loaded 18-wheeler.

    when I say computer-loaded.. I don't mean the fork-lifts are computer-controlled.

    I mean the contents of the shrink-wrapped pallet.. that has on it… what those scanners deducted at the checkouts the day or two days prior.

    This is how the worlds supply chain "works" …not matter how a community's is configured settlement-pattern wise.

    Dollar General stores …much smaller.. and in many locations too small for WalMarts still receive tractor trailer shipments but instead of the whole truck..each store may only get one or two pallets before that truck goes to the next small store.

    Every got food from McDonalds or Subway or Pizza Hut?

    They all work the same way.

    We often don't give a second thought as to why a tractor trailer is at the back of a McDonalds.. but they are….

    and McDonalds.. has already downsized their stores..

    you can find a tractor-trailer-supplied McDonalds in just about every hamlet and cross-roads communities across the entire nation.. and, in fact, worldwide.

    so.. does this fact.. automatically mean that any community served by this logistics network is automatically excluded from being a "balanced community"?

    See.. EMR has this concept of Urban Support Regions that serve the urban areas.

    But it was not in his original philosophy… was added later on.. and appears to me to be a work in progress.

    for instance, I don't think he's ever said.. for instance if urban support regions grow chickens in bulk for hungry balanced community folks…or whether or not such chickens …properly prepared for human consumption ..make their way to "balance communities" via tractor trailer.. rail or magic carpet.

    In other words.. what is EMR's view of the logistics supply chain and a sustainable world?

    Is it a valuable enabler of more functional settlement patterns or is it the cause of dysfunctional settlement patterns or does it not matter or should mom&pop stores grow chickens in their back yards "fresh" on a per order basis?

    Me? I like it when I buy dog food and it does not have last years expiration date on it.. and that always seemed more of a problem with mom&pop… and do ya'll remember when FRESH MEAT had much more meaning to it that it does today in WalMart?

    We have a duty here in BR to keep EMR honest.. because being the intellectual academic that he is.. we don't want him slacking off and getting lazy in his thinking.

  2. RBV Avatar
    RBV

    Speaking of logistics….

    It’s my understanding that the main reason Wal*Mart hasn’t penetrated large cities is because these locations are a logistical nightmare.

    In other words, they can’t get the trucks to the stores in a timely manner. And, even if they could, goods would cost more because of the extra time and money it requires to get trucks to inner-city locations.

    “Over the past decade Wal*Mart would not have shown a profit if all the location-variable costs were fairly allocated and Wal*Mart was not subsidized directly and indirectly.”

    I have made this point before to one of my City Council members….it all started when we began discussing how to “save” our historic downtown area.

    To make a long story short, I basically asked him when was the last time he had to pay to park in the Wal*Mart parking lot?

    Then I asked him why any business owner in their right mind would open up a retail store in our historic downtown area where potential customers are required to put $$$$ in a parking meter in order to go shopping.

    He was speechless.

  3. Anonymous Avatar
    Anonymous

    “Over the past decade Wal*Mart would not have shown a profit if all the location-variable costs were fairly allocated …”

    Oh puleeze….

    RH

  4. Anonymous Avatar
    Anonymous

    Wal-Mart: Everyday Job Creator: 1,400 in May

    JACKSONVILLE, Fla., May 13, 2009 – A new Walmart opens this month in Jacksonville, bringing 400 new jobs, savings for local shoppers and an increase in tax revenue to support the area’s economy. Nonprofit organizations will also benefit from the retailer’s ongoing charitable contributions and support for community projects. The Walmart, located at 10251 Shops Lane, will be open to customers at 8:15 a.m., Wednesday, May 20th.

    MARICOPA, Ariz., May 15, 2009 – The new Walmart in Maricopa will celebrate its grand opening this week, bringing the community 320 new jobs, support for local organizations and Walmart’s unbeatable prices on a full line of groceries and general merchandise. The new store, located at 41650 W. Maricopa Casa Grande, will open at 8 a.m., Wednesday, May 20 and give local shoppers a glimpse at Walmart’s next generation of store design and customer experience.

    CAMDEN, Ark., May 14, 2009 – A new Walmart opens this month in Camden, bringing 170 new jobs, savings for local shoppers and an increase in tax revenue to support the area’s economy. Nonprofit organizations will also benefit from the retailer’s ongoing charitable contributions and support for community projects. The Walmart, located at 950 California Ave., will be open to customers at 8 a.m., Wednesday.

    WAL-MART MARKET TO BRING ABOUT 90 JOBS TO LARGO — The 42,000-square-foot former Kash n’ Karry in southwest Largo has been a sign of the harsh reality of the stark economic times. But things are looking up for the once-vacant building.

    Scheduled to open as a Wal-Mart Neighborhood Market on July 15, the store is seeking potential workers. Wal-Mart is looking to hire at least 90 people to staff the 24-hour, seven-day-a-week grocery store.

    New Albuquerque Wal-Mart Hiring 420 — Wal-Mart is hiring 420 people for its new Albuquerque Supercenter, which is scheduled to open July 15. “It’s almost like bringing hope back to the community,” said store manager Alberta Garcia. “When you have all these companies laying off people and here we are bringing 420 jobs in.”

    From Carpe Diem

    RH

  5. Anonymous Avatar
    Anonymous

    May 7 (Bloomberg) — Wal-Mart Stores, the world’s largest retailer, reported comparable-store sales for April that rose more than analysts expected. Revenue from U.S. stores open at least a year increased 5%, excluding gasoline sales, in the four weeks through May 1, the Bentonville, Arkansas-based company said today in a statement. That exceeded the 3% average estimate compiled by Retail Metrics Inc., a Swampscott, Massachusetts-based consulting firm.

    U.S. store visits rose the most in seven months, spurred by demand in the grocery, health, home and entertainment categories, Wal-Mart said. Some consumers spent more freely on sporting goods and other discretionary merchandise after gasoline prices and payroll taxes dropped. The shift of Easter to April 12 from March 28 in 2008 also lifted sales.

    Target Corp. announced Thursday that net retail sales for the four weeks ended May 2 were $4.45 billion, up 4.5% from the comparable period last year.

    Minneapolis-based Target (NYSE: TGT) said first-quarter highlights included better-than-expected same-store sales and gross margins, favorable retail expense performance and credit card results that were in line with prior guidance.

    ===================

    Yep, the worled is ending.

    RH

  6. Anonymous Avatar
    Anonymous

    “Wal-Mart’s Generic Prescriptions Are Almost Free

    BENTONVILLE, Ark., May 5, 2009 – Today in Michigan Walmart announced a pilot program that will offer a 90-day supply of 300 generic prescriptions, each for $10 via free mail delivery. Beginning today, from Detroit to Grand Rapids to Alpena, Michiganders across the state will be able to take advantage of this new affordable pharmacy program from Walmart by calling 1-800-2REFILL. Additionally, Walmart’s free mail delivery program has no gimmicks, no memberships and no enrollment fees. This announcement signals Walmart’s commitment to help consumers save money on prescriptions regardless of whether or not they live close to a Walmart pharmacy location.”

    =======================

    Travel? Not a problem

    RH

  7. Anonymous Avatar
    Anonymous

    Fact of the Day

    American shoppers could have saved more than $21 billion last year by purchasing the same categories of packaged food at Walmart. This is far greater than the $2.6 billion Americans saved last year using coupons in all retail stores.

    ~Wal-Mart website

    ======================

    OK, so yu have to consider the source.

    RH

  8. Anonymous Avatar
    Anonymous

    Enjoy A Turkey or Ham Easter Dinner For Eight For Under $35, Including 2 Bottles of Wine and Dessert

    Where else? Wal-Mart

    RH

  9. Anonymous Avatar
    Anonymous

    “According to Forbes, Wal-Mart was the most generous corporation in America in 2007 (probably the world too), giving away $301 million in cash gifts to the Children’s Miracle Network, Feeding America, The Salvation Army, the American Red Cross, the United Way of America, National Fish and Wildlife Foundation.

    This week, Wal-Mart announced that it: Stepped up charitable giving globally from February 1, 2008 through January 31, 2009 with more than $423 million in cash and in-kind gifts, an $85.6 million increase over its global giving in the previous year. Last year, Wal-Mart and the Wal-Mart Foundation gave millions of dollars to numerous national and local charities including the Institute for Higher Education Policy ($4.1 million), YouthBuild ($5 million), Children’s Miracle Network ($4.7 million), The Salvation Army ($3 million), Special Olympics ($3.6 million), the National Urban League ($1 million) and the National Fish and Wildlife Foundation ($3.4 million).

    Other Wal-Mart Facts:

    1. Wal-Mart directly employs more than 2 million associates worldwide, including more than 1.4 million in the United States. Through its relationships with 56,000 U.S. suppliers, Wal-Mart spent $200 billion on merchandise in 2007 and indirectly supported more than 3 million American jobs. The 4.4 million Wal-Mart-related jobs represented 3.2% of total U.S. payroll employment in 2007.

    2. Wal-Mart is a diverse employer, employing more than 165,000 Hispanics, 251,000 African Americans, 39,000 Asian Americans, 5,000 Pacific Islanders, 16,000 Native Americans, 355,000 associates age 50 or older, and 856,000 women (61% of Wal-Mart’s workforce).

    3. Wal-Mart insures more than 1.1 million associates and family members making it among the nation’s largest providers of private sector health insurance.93% of Wal-Mart associates reported having some form of health coverage – either through Wal-Mart or another source.

    4. Wal-Mart offers the opportunity for a career: More than 75% of Wal-Mart’s store managers started as hourly associates.

    5. In 2007, independent research from Global Insight shows that the reduction in the price level due to the presence of Wal-Mart translates directly into savings for consumers amounting to $287 billion in 2006. This corresponds to savings of $957 per person and $2,500 per household, regardless of where consumers choose to shop. That is, even consumers who shop at Target, Best Buy or Office Depot save money from the presence of Wal-Mart, due to the competitive pressure of Wal-Mart’s “Everyday Low Prices.”

    Here’s a case that Wal-Mart deserves the Nobel Peace Prize.”

    From Carpe Diem

    RH

  10. Anonymous Avatar
    Anonymous

    Wal-Mart’s $2 Billion Bonus Stimulus

    March 19 (Bloomberg) — Wal-Mart Stores Inc., the world’s largest retailer, plans to award $2 billion in extra compensation to about 1 million U.S. hourly workers this year after sales jumped in the recession (average of $2,000 per worker). The Arkansas-based retailer is benefiting from record sales in the fourth quarter that boosted annual revenue by 7.2% to $401 billion.

    The amount of the bonuses, profit sharing, discounts and 401(k) and stock-plan contributions being given to employees compares with the $1.8 billion Wal-Mart distributed last year. Payments to employees include $933.6 million in bonuses today.

    HT: Russ Roberts, who points out that “This is how capitalism once worked. Successful companies rewarded their employees and lousy companies disappeared.”

    RH

  11. Anonymous Avatar
    Anonymous

    “BENTONVILLE, Ark., March 19, 2009 – Committed to helping Americans save on out-of-pocket health care costs, Wal-Mart Stores Inc., today announced it has sharply reduced what customers pay for both contact lenses and youth eyewear.

    In an effort to further drive down health care costs, Walmart and 1-800 CONTACTS, the world’s largest retailer of contact lenses, are working together to help more Americans save as much as 12 to 50 percent on the costs of a yearly supply of contact lenses. Additionally, Walmart has lowered its prices on glasses and frames for children and teenagers to make quality eyewear more affordable for families across the nation.

    “Working with our suppliers and 1-800 CONTACTS, we have found a way to help our contact lens customers spend less and save more,” said Dr. John Agwunobi, senior vice president and president of Walmart’s Health and Wellness division. “By offering greater accessibility and affordability, we believe the customer savings could reach $400 million during the first three years of this alliance.”

    To help families during tough economic times, Walmart has also lowered prices on quality eyewear for children 18 years old and younger. Year-round, parents and caregivers will find youth frames and lenses for as low as $39. Walmart will also provide a one year guaranteed free replacement if the glasses are damaged.”

    —————————–

    Maybe if Ed went to WalMart he would be able to see the truth.

    RH

  12. Anonymous Avatar
    Anonymous

    “About a year ago, Wal-Mart opened a customized store in Dearborn, Michigan targeted to the large Arab-American community there (CD post here) as part of a corporate strategy to tailor stores to local demographics. At the time, Wal-Mart said it also planned to target six other groups: Hispanics, blacks, empty-nesters/boomers, affluent, suburban and rural shoppers.

    Now, Wal-Mart announces that it will open its first Hispanic-focused supermarkets this summer in Arizona and Texas.

    The pilot stores, named Supermercado de Walmart, will open in Phoenix and Houston in remodelled 39,000 sq. ft. locations occupied previously by two of Wal-Mart’s Neighborhood Market stores. The retailer said that the stores were in “strongly Hispanic neighborhoods” and would feature a “new layout, signing and product assortment designed to make them even more relevant to local Hispanic customers”. The staff will also be bilingual.”

    ————————

    Note to EMR: It helps if you speak your customers language.

    RH

  13. Anonymous Avatar
    Anonymous

    “WASHINGTON (Reuters) – Wal-Mart Inc, which has moved into low-cost healthcare with walk-in clinics and cheap prescriptions, said on Wednesday its Sam’s Club unit would sell a package including software and Dell computers directly to doctors for electronic medical records.

    “We are trying to help the small practice doctor have access to medical records and practice management software re as well as the hardware at an affordable cost,” said Sam’s Club spokeswoman Susan Koehler.

    The discount retail giant said it would offer a package deal with hardware, software and installation for electronic medical records and e-prescribing. “We will be a single point of contact to help with training, installation, maintenance,” Koehler said.

    Wal-Mart also has walk-in medical clinics called “The Clinic at Wal-Mart” and aims to open 2,000 nationwide in five to seven years. Wal-Mart also offers more than 1,000 over-the-counter items for $4 or less, a move that forced retailers from Target Corp to grocery stores and stand-alone pharmacies to offer similar discounts.”

    ————————–

    Note to EMR: Capitalism and competition work. Even if Target gets similar subsidies as Walmart.

    RH

  14. Anonymous Avatar
    Anonymous

    “FT.com — Wal-Mart, the world’s largest retailer, beat expectations after its US discount stores accounted for about 50% of all US retail growth during 2008 – while its full-year global sales passed $400 billion for the first time, and profits hit $13.4 billion.”

    ——————-

    The slump really seems to be hurting WalMart.

    RH

  15. Anonymous Avatar
    Anonymous

    Several of my co-workers had relocated from other areas, where they had worked at other Wal-Marts. They wanted more of the same. Everyone agreed that Wal-Mart was preferable to the local Target, where the hourly pay was lower and workers were said to be treated with less respect (an opinion which I was unable to verify). Most of all, my coworkers wanted to avoid those “mom-and-pop” stores beloved by social commentators where, I was told, employees had to deal with quixotic management policies, while lacking the opportunities for promotion that exist in a large corporation.

    ~From Charles Platt’s blog post “Life at Wal-Mart”

    ————————–

    Nuff Said

    RH

  16. Anonymous Avatar
    Anonymous

    Charles Platt is a former senior writer for Wired magazine who took a job at an Arizona Wal-Mart and blogged about it here. He now has a longer article in yesterday’s NY Post titled “Fly on the Wal: Undercover at Wal-Mart, The Heartland Superstore That May Save the Economy.” Here are some excerpts:

    Some people, usually community activists, loath Wal-Mart. Others, like the family of four struggling to make ends meet, are in love with the chain. I, meanwhile, am in awe of it.

    The company is rebuked and reviled by anyone claiming a social conscience, and is lambasted by legislators as if its bad behavior places it somewhere between investment bankers and the Taliban.

    Considering this is a company that is helping families ride out the economic downturn, which is providing jobs and stimulus while Congress bickers, which had sales growth of 2% this last quarter while other companies struggled, you have to wonder why. At least, I wondered why. And in that spirit of curiosity, I applied for an entry-level position at my local Wal-Mart.

    Getting hired turned out to be a challenge. The personnel manager told me she had received more than 100 applications during that month alone, chasing just a handful of jobs. Thus the mystery deepened. If Wal-Mart was such an exploiter of the working poor, why were the working poor so eager to be exploited? And after they were hired, why did they seem so happy to be there? Anytime I shopped at the store, blue-clad Walmartians encouraged me to “Have a nice day” with the sincerity of the pope issuing a benediction.

    Despite its huge size, the corporation turned out to have an eerie resemblance to a Silicon Valley startup. There was the same gung-ho spirit, same lack of dogma, same lax dress code, same informality – and same interest in owning a piece of the company. All of my coworkers accepted the offer to buy Wal-Mart stock by setting aside $2 of every paycheck.

    Almost all the employee rules devolved to the sacred principle of never, ever offending a customer – or “guest,” in Wal-Mart terminology. The reason was clearly articulated. On average, anyone walking into Wal-Mart is likely to spend more than $200,000 at the store during the rest of his life. Therefore, any clueless employee who alienates that customer will cost the store around a quarter-million dollars. “If we don’t remember that our customers are in charge,” our trainer warned us, “we turn into Kmart.” She made that sound like devolving into some lesser being – a toad, maybe, or an ameba.”

    RH

  17. Anonymous Avatar
    Anonymous

    Watch the video of WalMarts expansion across the US:

    http://projects.flowingdata.com/walmart/

    RH

  18. Larry G Avatar
    Larry G

    geeze RH. do you own stock?

    re: downtown “parking”

    Same deal in Fredericksburg.

    but get this:

    “The downtown retail merchants group told the city earlier this year that it was opposed to the new rules, in particular a provision that would allow businesses to pay a fee to the city instead of providing required parking.

    The group’s representatives said they feared that strategy would make it easier for large national chains, versus small independent shops, to get going downtown.”

    http://fredericksburg.com/News/FLS/2009/052009/05262009/468196

    so… WalMart pays to build a parking lot as part of their Business Model.. and the Downtown Merchants see this as a threat to THEIR business model.

    re: Walmart/tractor trailers/downtowns

    very interesting comment.

    downtowns need trucks for re-supply but smaller versions…

    I note that NYC is in the midst of deciding if Times Square is going to become a pedestrian-only zone.

  19. Anonymous Avatar
    Anonymous

    Actually WalMart is one of the few stocks I have ever managed to lose money on. not much, but still down a little.

    It is just too easy to find good stuff about WalMart. 98% of th population has shopped there at one time or another, so espite all the bad things said, an awful lot of people don;t seem to have a problem with it.

    Some of them are probablyeven hypocrites. I can remember when there was a fight over WalMart in Warrenton, and you would see Fauquier cars with “No WalMart” bumper stickers – at the Manassas WalMart!

    Some people just can’t stand the idea that someone else can be successful, or they have the (wrong) idea that if someoen else is successful it must be bad for them.

    Walmart has propbably saved Americans a lot more money than it has cost us in foreighn trade imbalance.

    RH

  20. Accurate Avatar
    Accurate

    Oh EMR – there are some things that are so predictable, like your assuming that everything is connected to your ‘human settlement’ theory. As I stated before, you remind me of a carpenter to whom every problem looks like a nail and they have this one tool that can fix the problem.

    No, there are many reasons that Walmart has made their stores smaller. Among them, certain cities have started dictating how large the stores can be and even how they can look. There are space considerations when trying to locate a Walmart in an area where a smaller store/school/mall was once located. Closer to the customer, maybe, but not the major driving force.

    Sorry, we do enjoy our freedom and many of us don’t want to live in the cubical world that you appear to want to have us live in. BTW – I’m LOVING Houston, for the most part we are as far away from EMR’s tastes as one can get. I like it alot more than I did the Portland area (Oregon once was a great place where you helped your neighbor if he asked, but you basically left him alone. Now Oregon has one of the biggest Nanny governments around, it’s sad.)

  21. Larry G Avatar
    Larry G

    The problem I have with EMR’s stance on Walmart is this.

    He does not acknowledge the validity of a worldwide logistics supply network for goods and services so for him… it appears that there is absolutely no version of any kind whatsoever of a WalMart that is acceptable under any circumstances.

    In other words, the concept itself is unacceptable.

    Maybe I’m wrong but he sure can correct me if I am…

    If he objects to the underlying concept that WalMart exploits to maximum advantage…

    then, he’s also essentially rejecting any other retailer than also bases their business model on the same concept.

    So.. you can wipe off the map… Target, Home Depot, Lowes, McDonalds, etc, etc, just about every national chain that one can think of.

    He touched on this a couple of times before and what I got out of it was that he thinks that virtually all products need to come from the NUR and the USR but he’s always been mostly murky about what USRs are (and are not) and what the logistics supply functionality looks like between the USR(s) (?) and the NUR(s).

    and perhaps the most paradoxical is the fact that the modern logistics supply network.. is a couple thousand years old and always evolving and optimizing.

    We find jugs of wine ..that old in the Mediterranean that were on their way from somewhere to somewhere else … as opposed to being grown locally and consumed locally.

    Just about every port in the world ..is an integral part of the settlement pattern it is part of.

    sometimes.. the settlement pattern itself came second…and actually grew up around the port….

    such ports are definitely not New Urban Regions… they are very clearly the ORIGINAL Urban Regions..with grid streets, shops at street level with living space above… etc..etc…

    virtually everything that NEW URban Regions seem to be trying to emulate now days.. EXCEPT when it comes to the logistics supply network… of which…advocates such as EMR are mostly mute and when they do speak of it.. they do in broad terms… with opinions that WalMarts ..are NOT..the Correct Way to do it.

    so.. I ask….

    what is…

    and the silence is deafening.

  22. Anonymous Avatar
    Anonymous

    “he thinks that virtually all products need to come from the NUR and the USR “

    This is economic junk logic. There is no economic reason to buy locally,if it is more expensive than buying globally.

    maybe Walmart isn’t paying its fill external costs, but as Larry points out it operate on a level playing field with other major retailers in that regard.

    If the playing field was on a different plane, why would WalMart fare any worse? They would still be successful and still beat out Mom and Pop (except for niche markets).

    If there is a legitimate argument that they are not paying enough for public services, that is one thing, but arguing that they are evil and should not exist is something else.

    ————————

    What would be the government argument that says there is a net public benefit to limiting store size? I doubt there is one, but instead this is a matter of kow towing to vocal, and wrong, public sentiment.

    The Warrento WalMart story was a hoot. Faced with size restrictions the store was built on the town/county boundary line, with max size in each jurisdiction.

    Initially warrenton refused to provide water and sewer, but they got beat down on that idea, and after the store was a fait accompli the town subsequently annexed the remainder of the property, in order to get the tax revenues. In doing so they set aside their own store size limitations.

    Meanwhile, local protesters were claiming that the store would both increase traffic AND destroy local businesses. Nevermind that the same protesters were driving to the Mannassas WalMart.

    The whole thing would make a good episode for the Goode Family.

    RH

  23. Larry G Avatar
    Larry G

    I’m trying to think of ANY retailer with a national presence that does things differently… including those that bill themselves as “Green”.. such as Whole Foods… Starbucks.. even Home Depot which sells wood that is certified to be “sustainable”.

    If you just look at the things that go into a place to live – even if that place is in the best balanced community settlement pattern in the entire world…

    it’s going to need structural components.. steel or wood or concrete… plumbing.. copper or plastic… electricity…ditto. sheetrock… light fixtures… you name in..

    remember.. not too long ago.. when the creme-de-le-creme of some things were that they had an “imported” sticker on them?

    and notice that Whole Foods is struggling with this issue:

    ” Can organic food from China truly be organic?”

    http://blog.wholefoodsmarket.com/2008/06/is-organic-from-china-possible/

    Notice that they’re dealing with issues other than the ethics of importing the goods via the logistics supply network.

    However, the respondents were opposed to buying goods from China..even organic products on the grounds that “cheap” means low wages and other corner cutting (evading costs).

  24. Anonymous Avatar
    Anonymous

    I’m not sure whether this one has been asked before. If so, I apologize.

    Let’s assume that Walmart does NOT pay its full locational costs. Who pays those costs? How do we know that? How much do they pay? Does Walmart keep its subsidy? Or does it pass it along to its customers? If, the latter is true, is there any overlap between those who pay subsidies to Walmart and those to whom Walmart passes along the subsidies?

    Please note that I am not arguing for subsidies. I just want to understand EMR’s position.

    TMT

  25. Larry G Avatar
    Larry G

    Most places have WalMarts, Targets, Kohls, Sports Authorities, Best Buys, NTS Tires… and they all work the same basic way…

    the main thing that is different is what they sell…

    WalMart is not the only one opening up newer an smaller footprint stores either.

    In fact, companies like McDonals an Subway are opening up shops inside of WalMarts and even Service Stations….

    and every single one of them … gets resupplied from regional distribution centers via, in most cases, a fairly large truck… on a round-robin loop.

    these "loops" are not even centered around the NUR…but around their Distribution Center which could serve part of one NUR and part of another..as well as USRs.

    So I guess my point is… that if WalMart is not paying it's fair share of location costs.. probably most of the multi-store retailers are also.

    Even local Mom&Pop stores get resupplied from Distribution Centers…

    When a truck shows up at any of these stores – they have goods on board from all over the world.

    The Distribution center – receives goods from all over the world – by ship, then rail in most cases….

    And don't forget FedEx and UPS…

    I'll bet that everyone who frequents this blog is a customer…

    the whole dang INTERNET is one giant Fed Ex/UPS retail store.

    For many, many products, you can decide if you want the one in Pennsylvania or the one in Texas..the only difference being the cost of the product plus it's shipping …

    I don't see how .. this would change.

    Oh ..you could increase the price of the shipping to pay for the location costs but people would still buy…

    about the only thing that would change is those goods that cost substantially less than the shipping costs.

    And look at what WalMart is doing now with their Ship-to-Store.

    If you order online..they'll ship in to your store for free by just putting it on the same truck that is headed that way anyhow.

    That is …saving fuel.. more efficient… than even buying from a Mom&Pop if they also got their products the same basic way… by truck…

  26. Accurate Avatar
    Accurate

    Larry –
    What has always made me laugh is this argument that ‘cheap’ means lower wages. Lower wages than what?

    Gee, someone in China is making $400 a month, THAT is what lower wages means. However, look at the whole picture, in that same area of China maybe the median wage is $250 a month, this workers is ‘making bank’ (as I’ve heard the younger generation say). Our standards are NOT their standards and theirs are not ours. However, most eco-nuts don’t look that far, they just scream about how little that worker in China is being paid. Meanwhile the worker in China is THRILLED that he or she can get such a high paying job.

  27. Larry G Avatar
    Larry G

    indeed. I agree.

    Earning a "lower" wage is way the heck better than not having a job and every single worker for Walmart or it's products is free to "upgrade" themselves at any point when they can better themselves.

    WalMart workers also get pension and health-care benefits, not the greatest for sure – but way the heck better than what most Mom&Pop stores.

    We could get into a bigger issue which is what exactly is a "living wage" and WalMart and other retailers would have to do – to meet that standard.

  28. Anonymous Avatar
    Anonymous

    I remember having that argument with my employer in North Carolina, arguing that I should be psid more. (I had more experience and a better quality record than most of the locals on the floor.)

    And the resposnse was that well, we have a lower cost of living down here. Which implied that they charged less for their goods ( they did not, because most of their goods were sold nationwide). It also had nothing to do with what I was worth to them.

    Instead I just said, yes, and you also have a lower standard of living.

    RH

  29. Larry G Avatar
    Larry G

    This was one of the issues with Toyota and the other non-US companies when they opened up shop in the US.

    They were not anti-union… per se… in fact.. they treat their folks pretty good…

    but what they were concerned about was a rule requiring them to pay the same amount per hour no matter where they opened up a plant.

    It’s no secret why they picked smaller towns in the South with local prevailing wages and cost of living.

    Folks can argue that that is Toyota not paying their fair share of location costs but I see the other side – which is an area.. that used to be relatively poor and jobs scarce… not much better off and even prosperous…

    especially compared to their cousins up North in places like Michigan and environs.

  30. Anonymous Avatar
    Anonymous

    Congress and the Obama administration are spending billions to expand broadband access to more rural areas in order to stimulate growth. It will make possible more growth, more Walmarts, more McDonalds; more subdvisions; more commerce.

    EMR, is this a good, bad or indifferent thing and why? This is not a trick question. I really want to what you think and why you think that way.

    I’m not sure how you would answer, but want to know.

    TMT

  31. Larry G Avatar
    Larry G

    Of course expanding broadband into the rural areas has two aspects to it.

    Like Roosevelt’s WPA initiative.

    ” The Works Progress Administration (renamed in 1939 to the Work Projects Administration; WPA) was the largest New Deal agency, employing millions of people and affecting almost every locality in the United States, especially rural and western mountain populations.”

    …..

    ” Almost every community in America has a park, bridge or school constructed by the agency. Expenditures from 1936 to 1939 totaled nearly $7 billion”

    ” The goal of the WPA was to employ most of the unemployed people on relief until the economy recovered”

    in reading this.. it’s not easy to understand if rural America was a primary recipient of the WPA – on purpose – or because American was… still rural and not yet moving more and more towards urbanization.

    However.. it is clear.. that folks were unemployed and the WPA intended to get them working again.

    The same might be said of so-called farm-to-market roads and rural electrification.

    Was the point to “help” rural American …or was the point to “help” rural America become a more productive part of the total economy?

    EMR doesn’t like the designation “rural”… although his Urban Support Regions sound “functionally” a lot like what many of the rest of us – perceive as one of the purposes of “rural”.

    Does it help the country as a whole if a (rural/USR) Dairy Farm has electricity and a decent enough road to move milk from that farm to an urban area for consumption?

    Would you help that same Dairy Farm if the folks who operated it and their children had access to the Internet?

    I too would like to hear EMR’s answer to TMT’s question.

  32. Anonymous Avatar
    Anonymous

    ” or because American was… still rural and not yet moving more and more towards urbanization.”

    America is still mostly rural, it is just theat not as many people live there anymore.

    Partly that is because we have made it so expensive that rural living is a rich mans enclave. EMR would have it made more so, whether it reflects true locational costs or not.

    RH

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