EXPLOITING BUYER POWER: LESSONS FROM THE BRITISH GROCERY TRADE

By Paul W Dobson

As in the United States, increased concentration in grocery retailing in Great Britain has raised issues about the buying power of multiple retailers.Whether, and if so how, it prevents, restricts, or distorts competition at the retail and/or producer level to the public or consumer detriment has been the central aspect of concern in a number of formal investigations by the British competition authorities over the last couple of decades. These include the industry inquiries conducted by the Monopolies and Mergers Commission in 1981, by the Office of Fair Trading (OFT) in 1984 and 1999, and by the Competition Commission in 2000. Retailer buying power has also featured in certain merger cases, most notably the recent Competition Commission inquiry into Safeway and the contemplated mergers with Asda, Wm Morrison, J Sainsbury, and Tesco in 2003.

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HIDDEN COST OF WAL-MART JOBS

Wal-Mart is the largest employer in the United States, with over one million workers. It is the largest food retailer and the third largest pharmacy in the nation. The company employs approximately 44,000 workers in California, and has plans to expand significantly in the state over the next four years. Wal-Mart workers receive lower wages than other retail workers and are less likely to have health benefits. Other major retailers have begun to scale back wages and benefits in the state, citing their concerns about competition from Wal-Mart. We estimate that Wal-Mart workers in California earn on average 31 percent less than workers employed in large retail as a whole, receiving an average wage of $9.70 per hour compared to the $14.01 average hourly earnings for employees in large retail (firms with 1,000 or more employees). In addition, 23 percent fewer Wal-Mart workers are covered by employer-sponsored health insurance than large retail workers as a whole. The differences are even greater when Wal-Mart workers are compared to unionized grocery workers. In the San Francisco Bay Area, non-managerial Wal-Mart employees earn on average $9.40 an hour, compared to $15.31 for unionized grocery
workers—39 percent less—and are half as likely to have health benefits.

At these low-wages, many Wal-Mart workers rely on public safety net programs— such as food stamps, Medi-Cal, and subsidized housing—to make ends meet. The presence of Wal-Mart stores in California thus creates a hidden cost to the state’s taxpayers. This study is the first to quantify the fiscal costs of Wal-Mart’s substandard wages and benefits on public safety net programs in California. It also explores the potential impact on public programs of Wal-Mart’s competitive effect on industry standards.


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Carrefour vs. Wal-mart: The Battle for Global Retail Dominance

Carrefour SA (Euronext: CA) (pronounced [karˈfur]) is a French international hypermarket chain, with a global network of outlets. It is the second largest retail group in the world in terms of revenue after Wal-Mart. Carrefour operates mainly in Europe, Brazil, Argentina, Dominican Republic and Colombia, but also has shops in North Africa and Asia. Carrefour means "junction" in French. Having Wal-Mart began to expansion in Europe by purchase of Asda, Carrefour began to treat the Wal-Mart moves as a threat to its business dominance not only in Europe but also in the world retailing market. This articles take a look on the business of hypermarket retailing, its history of growing importance and the competitive scenario in the growing competition between the giant retailers in the market.

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Wal-Mart Takes on Wall Street

Whether people like or hate Wal-mart, the large retail chain store, there is one thing they do agree on. Wal-mart has cornered the market on merchandising products that average middle class American families can afford. Widely criticized for putting "mom and pop places" out of business and not paying their employees fair wages, the company has undergone a lot of scrutiny over the last few years, and now they are gearing up to be under the watchful eye of America once more.

Wal-Mart is ready to take on Wall Street, as company executives try to enter the store into the banking business! An attempt in 1999 to purchase an Oklahoma Savings and Loan was met with a negative result by Congress. People are afraid that if Wal-mart enters into the world of banking, smaller banks won't be able to compete with the amenities they offer. Opponents of the plan include Sen. Hillary Rodham Clinton, who ironically once sat on Wal-Mart's board, but feels it wouldn't be prudent to remind people of those ties with an election year closing in on her ...

Those who support the idea point out that Wal-mart would do for the average American's banking needs what it does for their retail needs. It would make banking available for the little people that big banks tend to overlook. Right now, most banks force lower income families (i.e. those that can't afford to carry big balances in their checking accounts) to pay higher than normal fees.

Wal-mart isn't trying to become a full-fledged bank. They gave up on that idea the last time they were rejected in their attempts. They simply want to apply for a charter that will help them reduce their credit card fees. At present the company offers a check cashing service that costs patrons $3 to have a check cashed. While this may seem a bit expensive, it is much cheaper than the percentage fees that most check cashing businesses charge.

Started in Rogers, Arkansas in 1962, by Sam Walton, Wal-Mart is the largest retailer in the world. Wal-Mart is the largest private employer in the United States, Mexico and Canada. It also has given back to shareholders over 180,000% in total returns since it went public in 1972. There should be no wonder that several Walton heirs feature on Forbes' list of billionaires; they include Christy Walton, Jim Walton, S. Robson Walton, Alice Walton, and Helen Walton who all hover around a net worth of $16 billion.

Ref: Salim Jordan