What effect does Wal-Mart have as a business model?

What effect does Wal-Mart have as a business model?

Jordan Goodman (Personal Finance Author) gives expert video advice on: How can Wal-Mart sell so cheap?; What effect does Wal-Mart have on the small businesses?; What effect does Wal-Mart have as a business model? and more...

Well Wal-Mart has had a big effect as a business model. A lot of businesses try to drive prices down as much as possible by buying things on mass bases. Not only domestically but globally. Wal-Mart buys a lot of material from China, India and other places where they can get very good prices and good quality. Much cheaper than they are going to get in the United States. So that to some extent has driven the trade deficit that we have because we are importing so much stuff to supply Wal-Mart's around the country. They also have a non union policy and that has been very tough, because there are millions of workers who are non-unionized. The entire Wal-Mart movement has made it tough on the labour business to unionize. I think the total unionization in the country now is about 8%, and that's probably going to keep going down. Because union stores are competing with the non union places like Wal-Mart and they are getting the cost of their goods lower because they are buying things from China. They are getting their cost of labour lower because they are not unionized. It makes it difficult for other companies to compete with their business model.