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Whats Wrong with Walmart

Essay by   •  October 26, 2011  •  Essay  •  1,401 Words (6 Pages)  •  1,993 Views

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What's Wrong With Wal-Mart?

I have been working at the Wal-Mart here in Morehead, KY for over a year now so I am very familiar with the organization. Wal-Mart is the largest retailer in the world and is also the largest corporation in the world. It generates three times the revenues of the world's number two retailer. Wal-Mart is also the nation's largest nongovernmental employer, employing more than 1.2 million workers. Their U.S> operations include 1,478 Wal-Mart discount stores (located in all 50 states); and 1,471 Wal-Mart Supercenters.

One of those Wal-Mart Supercenters is located right here in the Morehead Kentucky. These supercenters are hypermarkets with size varying from 98,000 to 261,000 square feet, with an average of about 197,000 square feet. These stores stock everything a Wal-Mart discount store does and it also includes: meat and poultry, baked goods, delicatessen, frozen foods, dairy products, garden produce, and fresh seafood. These supercenters may also include a garden center, pet shop, pharmacy, Tire & Lube Express, optical center, one-hour photo processing lab, portrait studio, and numerous alcove shops such as cellular phone stores, hair and nail salons, video rental stores, local bank branches and fast food outlets.

Wal-Mart is a company that consistently preaches the importance of customer service. Wal-Mart's mission statement and advertising slogan are the same: "We save people money so they can live better." Their purpose is: "If we work together, we'll lower the cost of living for everyone...we'll give the world an opportunity to see what it's like to save and have a better life." Wal-Mart has developed some unique, policies, principles, rules, processes and procedures in order to fulfill its mission. They include the Open Door Policy, Sundown Rule, Grass Roots Process, 3 Basic Beliefs & Values, 10-Foot Rule, Servant Leadership and the Wal-Mart Cheer.

All of those policies, principles, rules, processes and procedures are suppose to turn the espoused values into enacted values but they fail to do so. The overall truth is that the customer service at Wal-Mart is very mediocre at best. Most people may declare that it is downright terrible. I could never comprehend as to why it was so dreadful when the attitude that Wal-Mart reflected in their marketing campaign was the complete opposite. It was when I began working for Wal-Mart that I actually started to understand as to why the employers behaved the way do. The reason behind it has to do with ethical reasons along with a poor inventory management system.

Managers at Wal-Mart have a tendency to belittle their employees and make them feel unwanted or easily replaceable. This directly relates to Wal-Mart's high turnover rate. Approximately 70% of its employees leave within the first year. Combined with this treatment is the low wages that Wal-Mart offers. On average, Full time hourly associates received $10.11 an hour. When working 34 hours per week, an employee earns $17,874 per year and that is about twenty percent less than the average retail worker. Sam Walton once said, "I pay low wages. I can take advantage of that. We're going to be successful, but the basis is a very low-wage, low-benefit model of employment."

In 2005, Wal-Mart faced many accusations around the nation of forcing employees of working off-the-clock and denied them overtime pay and not allowing them to take rest and lunch breaks. They settled all of those class action lawsuits. Wal-Mart has since addressed that issue so it does not happen again. But they have created issues with the solution they implemented. No overtime is now allowed with Wal-Mart. If an employee at any time hits overtime in a work week, you are suspect to immediate termination.

47.4 % of Wal-Mart's employee's received health insurance through the company with 10% receiving no coverage at all. It all boils down to employees just not being able to afford it. Wal-Mart spends an average of $3,500 per employee for health care, 27% less than the retail-industry average of $4,800. For Wal-Mart to be such a successful company, it falls well below all of these important retail averages. Along with this healthcare issue, there

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