Trade is the basis of any kind of business. One of the examples of successful trading companies is Walmart, Inc., an American company that manages the world’s largest wholesale and retail chain. The main target regions are the USA and Mexico; also, the company is presented in Canada, South America, the UK, South Africa, China, and Japan. This is one of the most popular trading companies in the world and it can be found in different ratings. However, researchers state that its employees often give negative feedback about it (Meunier, 2019). Thus, many factors spoil the image of the organization.
A careful research dedicated to them is presented in the documentary “Wal-Mart: the high cost of low price.” The film’s director Robert Greenwald met and interviewed various Walmart employees or associates who worked there for a long time and are well aware of the situation. In the film, they talk about various details related to staff attitudes, salaries, working conditions and other. Viewers learn many new facts about the company, which can shed light on it. The purpose of this paper is to describe the Walmart business model shown in the film and suggest changes.
During multiple interviews Walmart CEO focuses on the stability and success of the company, talks about favorable working conditions and other benefits. Thus, it seems that one of the most important principles of the company is to get the highest possible profit at the lowest possible cost. This policy requires significant planning and allocation efforts. Of course, this may adversely affect the employees and the quality of goods, but managers benefit from this. Over the many years, the heads of the company have achieved a clear understanding of how to get the highest level of profit. They made significant success in this area and keep working using the same principles. However, in contrast to these principles and all the pleasant words of the CEO, the director of the movie shows the real state of things.
One of the directions of the company’s activities is international expansion. Walmart operates in several countries, which allows it to earn money in different markets and have stable income. Researchers state that Walmart “had to adapt to varying institutional contexts and accept unions in countries where workers have stronger freedom of association laws than exist in the United States” (Muñoz, Kenny, & Stecher, 2018, p. 87). However, it is notable that they managed to establish their work there successfully. Besides, such expansion has a positive effect on image: in the eyes of consumers, it is the large and powerful international company which deserves trust by default. Unfortunately, Walmart has many flaws, which are identified in the film of Robert Greenwald.
One of the most depressing facts about the company shown in the movie is the low salaries of employees. The people in the film talk about how little Walmart paid them. They did not even have the opportunity to afford corporate insurance, and for this reason, they needed to apply for government programs. Although these salaries fall within the subsistence level, it is not enough for an average person to get the essentials. This attitude to wages is related to the fact that the company tends to earn as much as it can and spend less. Unfortunately, this is usually to the detriment of many employees. People shown in the film talk about difficult life situations, exacerbated by work in Walmart. Their stories evoke strong emotions, which create the negative image of the company in the eyes of viewers.
According to the film, sometimes the company hires people without concluding contracts with them. Typically, it is offered to immigrants who, for example, were engaged in cleaning works. In addition, they were paid a salary lower than the established norm, which contradicts the law. Of course, this simplifies the life of the company, and immigrants have the opportunity to earn a living. However, from the point of view of morality and law, this organizational policy is unacceptable.
The situation is even worse in China and Bangladesh, where Walmart manufactories are located. Researchers note that “trade allows countries to specialize in what they do best and to enjoy a greater variety of goods and services” (Mankiw, 2016, p. 9). Unfortunately, an approach to working conditions is not always responsible in Walmart. One of the parts of the film shows tough working conditions that do not meet established standards. Besides, the salaries in these places are usually prohibitively low. Also, one of the participants in the film talks about the factories of Walmart in Latin America. The awful condition of the factories and their employees also contradicts all standards. This all makes viewers see the “real face” of Walmart. Researchers argue that “the fact that there are a limited number of people and limited amounts of land, capital, and entrepreneurship in an economy at any moment means that decisions have to be made about the best way of producing a given level of output” (Gillespie, 2016, p. 7). Thus, it is essential for a company to be responsible for people it hires and products they make.
After the movie was released, many viewers stopped shopping at Walmart because they think that it should not be supported by consumers. However, this organization has a lot of resources to use for positive changes. First of all, a company should review its core principles. To get as much as possible and spend as little as possible is a productive policy until it harms people. In this situation, it is necessary to choose other values, for example, justice and care for employees. Only based on these values, they will be able to gradually change the fundamental aspects of the functioning of the company.
One of the primary tasks of the organization is a decent level of remuneration and a comfortable working environment. The implementation of these goals is associated with increased costs in the short and long term. Even the current situation requires huge investments, as well as its future maintenance. However, happy employees and satisfied customers – this is what will positively affect profits. It is also necessary to change the policies regarding immigrants and employees in different countries. Each of them should receive appropriate payment and work in conditions that do not harm their health. Apart from the state of the employees, this will also affect the quality of the goods they produce which will cause a positive response from the consumer.
Walmart, even being a “giant” on the trading market, does business to the detriment of its employees. Thanks to “Wal-Mart: the high cost of low price,” this topic became widely known and provoked the reaction from people. However, it is likely that even after this, the situation in the company did not undergo significant changes. Thus, to create a positive image and improve the condition of the staff, the Walmart directorate will have to make considerable efforts. This is a long and complicated process, as the company is one of the largest in the world. However, after watching the movie viewers understand that these changes would be beneficial for Walmart.
References
Gillespie, A. (2016). Foundations of economics (4th ed.). Oxford University Press.
Mankiw, N. G. (2016). Principles of economics (8th ed.). Cengage Learning.
Meunier, H. (2019). Walmart: Diary of an Associate. Fernwood Publishing.
Muñoz, C. B., Kenny, B., & Stecher, A. (2018). Walmart in the Global South: Workplace culture, labor politics, and supply chains. University of Texas Press.