Walmart’s “Urban Strategy”

Posted on October 1, 2010

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Walmart is setting it sights on San Francisco and other urban markets to open smaller stores to service these areas.  Walmart has long had a tough battle in the Bay Area. As recently as July 2010, the city of Antioch voted down expansion plans for an existing store.  Back in 2006, the city of Hercules used eminent domain to block Walmart’s expansion. The oft-cited reason for such actions include the protection of existing small shop owners and resistance to low-paying retail jobs.

As luck would have it, I’ve been reading “Cheap: The High Cost of Discount Culture” by Ellen Ruppel Shell.  Here’s an interesting passage from the book:

The opportunity to buy in bulk offerd unbeatable economies of scale that, in _______’s words, was the “most powerful factor yet discovered to compel minimum prices.” Critics decried him as a bottom-feeding monopolist a vulture whos insistence on low prices was putting smaller merchants out of business.  ______ deflected event the most  biting critiques, arguing that, on the contrary, by cutting out the “middle man” and passing savings directly to customers, he was creating opportunities and a better life for his fellow Americans.

Can you guess who ______ is?  Not Sam Walton of Walmart, but John Wanamaker in the early 1900’s.  Wanamaker pioneered many of the discount retailing practices.  Seems that battling capitalism and the race to the price bottom isn’t a phenomenon introduced recently.