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¶ … control mechanism Wal-Mart: Price
Pricing controls -- Wal-Mart
Wal-Mart advertises itself as a company that provides the lowest prices, all of the time, in comparison to its generic and specialty-store competitors. It is able to deploy this low price model in a successful manner by selling at a high volume. It is also dependent upon cheaper and exploited labor in foreign nations, where many of its products are manufactured. For example, employees in China not only receive low wages but are "housed in dismal dormitories; they may choose to live elsewhere, but still have to pay the dorm rent. In Bangladesh…working hours are 8 a.m. To 10 p.m., seven days a week, for 13 to 17 cents an hour" (Gates 2011). By limiting the benefits of all of its employees, in the United States as well as abroad, and depending upon a relatively low-wage, part-time...
Wal-Mart employee's average annual income is under $14,000 and the health insurance available is so expensive most of its workers cannot afford to participate in the program. According to the documentary, Wal-Mart: The high cost of low price, company representatives openly recommend Wal-Mart employees make use of government-aid programs such as Medicare or food stamps to make up for a lack of adequate wages and benefits instead.
Instead of offering sales and discounts on specific goods, Wal-Mart advertises that it offers the lowest prices all of the time, allowing consumers to engage in one-stop shopping. Changing its business model and offering more competitive wages, Wal-Mart has alleged to its critics, would require a higher-wage model. Ethics comes at a price. Its consistency of its brand is one reason why the…
References
Gates, Anita. (2005, November 24). Review of Wal-Mart: The high cost of low price The New
York Times. Retrieved April 25, 2011 at http://www.walmartmovie.com/reviews_nytimes.php
Manners, Tim. (2005). Wal-Mart vs. Costco. Fast Company.
Retrieved April 25, 2011 at http://www.fastcompany.com/blog/tim-manners/shop-talk/wal-mart-vs.-costco
Database. Retrieved April 25, 2011 at http://tbmdb.blogspot.com/2009/03/control-mechanisms-in-business-models.html
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