this post was submitted on 19 Aug 2024
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Technology
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It's bound to happen. Why waste hours replacing tags when you can just change what the shelf says when the prices change.
But this article is so pro Walmart it's crazy.
Slim profit margins my ass. Walmarts gross profit for the twelve months ending July 31, 2024 was $163.786B,
Not to sound flippant, but do you know what gross profit means? They aren't pocketing all of that. Walmart's net profit margin is 2.66%, which is minuscule. They make up for that by having enormous volume.
That's an expected tradeoff of operating an essential service is the point. It's not as though their margin is that slim by mistake, or out of goodwill, or bad business sense. It's meant to lead to the situation where we shop at Walmart not by choice, but in lieu of other options.
Not really — it's because nearly everything they sell is highly fungible, and they compete on price. Nobody is willing to pay a premium to shop at Walmart. Twenty years ago you'd have been correct, but they've pretty much saturated the market at this point. They're trying to find profitability in automation rather than adding tons of new stores.
I'm really meaning the lack of option not to consume fast-moving consumer goods, rather than the option to pay a premium for them elsewhere. When their market position is similar to like an outlet for government rations except for private profit, their net is essentially what was skimmed off the top of free enterprise. 2.66% is just the current maximum amount that is justifiably worth without doing societal harm
That's true, but what you describe is pretty much the end state of big-box retail. Amazon is essentially the same, if we exclude AWS. It's all a race to the bottom. The solution, as always, is to buy direct from smaller producers if possible.