Question

Case Study: “The Wal-Mart You Don’t Know”

  1. Describe the problem faced by Vlasic. Why were they unable to oppose the sales plan put forth by Wal-Mart? Ultimately, how did responding to Wal-Mart affect their business?
  2. Was this an ethical supply chain decision on the part of Wal-Mart? Also, highlight any sustainable ethics that was involved here.
  3. What does this case tell you about how much influence a business can have with regard to its suppliers’ decisions and behaviors? What does this say about the conventional notions of the responsibility of firms for the practices of their suppliers (both in terms of individual firms and collectively)? Is it reasonable for consumers (or even regulators) to hold firms accountable?

Answer

  • It operates from Bentonville, Arkansas and operates a chain of hypermarkets, discount department stores, and grocery stores. As of February 2016, the corporation had 11527 stores in 27 states, with a total of 72 banners.
  • It is a family owned business as it is controlled by Walton family and the biggest private employer with 2.2 million workers.
  • Walmart the largest grocery retail in the United States. Walmart’s reputation is for offering low prices but quality products.
  • Wal-Mart the giant retailer’s low prices have adverse effects on the companies it does business with a good example being Vlasic.
  • Wal-Mart wanted to make a statement to its customers that it is the only company in a position to sell high-quality products at a low price.
  • The fact that the firm is the biggest retailer in the world and can import cheap products from China to sell them at low prices made it difficult for Vlasic to fight. Wal-Mart pressure makes it hard to compete with them.
  • Wal-Mart refused to help Vlasic, and since the company was making so little out of their product, they were unable to continue their operations and eventually filled for bankruptcy.
  • Price wars is a common aspect of marketing in the most organization, and it is ethical. Most of the companies try to lower the prices of their goods to attract more and more customers. As a result, this was a fair fight.
  • It was also ethical for Wal-Mart to decline the request from Vlasic to help them considering that they are rival firms and assist them to be independent would have created a rivalry between the two companies.
  • A company can exert performance pressure on their supplier’s behavior considering that they have to abide by the laws, rules and regulations provided by the corporation. In the case of deviation from the initial agreement, the supplier must be held liable for their actions.
  • The company is a separate entity from its supplier and thus, it does not have a responsibility to the suppliers at all. The suppliers work independently despite the fact that they must observe the companies rules and regulations.
  • It is not reasonable for consumers to hold a business accountable at all costs. The company comes with its terms and conditions, and so does the consumer. Thus, before reaching an agreement, both sides presents their issues and go their separate ways. The company is not accountable for its suppliers.
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