Crawl Across the Ocean

Thursday, February 10, 2005

Is That All There Is?

As you may have seen in the news, or over at Pogge's blog, or over at Voice in the Wilderness, Wal-Mart has decided to close its store in Jonquiere Quebec, the first unionized Wal-Mart store in Canada (there is one other).

Wal-Mart said it was closing the store because it was no longer financially viable. Now I think pretty much everyone would agree that this is just a bald-faced lie, but certainly I have neither the time nor the ability to prove it. But let's just say, for the sake of argument, that they're not lying and that this store has become unprofitable. To me there are two possible conclusions:

1) That's a hell of a coincidence, 235 stores in Canada and the only one which is unprofitable is the first one to be unionized. Not only that but there was no indication of any financial trouble until the union drive was underway and the financial problems didn't get severe enough for a closure until just before the negotiations with the union were going to go to mediation.


2) The only difference between a profitable Wal-Mart store and an unprofitable one is the ability to pay workers minimum wage. Which suggests that all the articles and studies about Wal-Mart's great efficiencies, it's supply chain management, it's economies of scale, all the benefits it brought to people by providing goods at lower prices - they were all nothing more than just a result of paying it's workers less money. So in all the incredible growth of Wal-Mart from an unknown regional player to the world's biggest retailer, there was no benefit to society at all - just a redistribution of wealth from already below average retail workers to the buying public and the Walton family. You know - it's more comforting to believe that they're just lying.

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  • OR 3)
    The store is unprofitable since that single store will inevitably affect profits of all other stores. So, in effect, I agree that this store is unprofitable to the Wal-mart corp as a whole. The benefits of having this store are outweighed by the costs.

    By Anonymous Anonymous, at 5:01 PM  

  • That's not option #3, anon., it's my initial assertion that they're probably lying.

    Here's a quote from the story,

    "In a news release, Wal-Mart said it had told the United Food and Commercial Workers union during negotiations for a first contract that the store's financial situation was "precarious."

    The company said the union's demands would have required more hiring and added hours."

    They're not talking about the potential impact on the chain of other stores unionizing as well, they're talking about the financial viability of that one store.

    If you're saying that they closed the store to send a message to all the workers at their other stores then we agree - my post was merely exploring the implications of what it would mean if that one store really was unprofitable due to union demands.

    By Blogger Declan, at 9:58 PM  

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