5 ms·

They're using the Walmart playbook

cptskippy 3y ago
The book The United States of Wal-Mart by John Dicker laid this all out pretty clearly nearly 20 years ago. * corrected spelling the author's name. **https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp/1585424226 https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp...
- nell 3y ago
  Does this book really exist? Google search on Amazon shows no results for this.
  - no_wizard 3y ago
    Appears the author's last name was a typo. Its John Dicker[0] not Decker [0]: https://www.goodreads.com/en/book/show/312990 https://www.goodreads.com/en/book/show/312990
  - cptskippy 3y ago
    I miss spelled the author's last name but the result still shows up: https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp/1585424226 https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp...
  - deleted 3y ago
    [deleted]
- m463 3y ago
  also another story: https://www.fastcompany.com/47593/wal-mart-you-dont-know-2 https://www.fastcompany.com/47593/wal-mart-you-dont-know-2
  - cptskippy 3y ago
    Wow that was a oldie. Great link.
A4ET8a8uTh0 3y ago
Some context may be needed. Walmart is known in MBA circles for being one of the first companies to have used detailed data on products to negotiate new terms with suppliers ( usually to suppliers detriment ). Information asymmetry with main goal to increase a chance for an increased leverage is what it is all about.
- avmich 3y ago
  I wonder if the supplier can similarly have the detailed data on the customer and how that helps in negotiating both ways.
  - steveBK123 3y ago
    It's asymmetrical for the most part on a lot of stuff Was listening to Bloomberg the other day and they were talking about how Walmart is the biggest grocer in US. They have pricing power because for example they constitute something over 5% of all Heinz sales. Similar for paper products from one of the big companies like Procter & Gamble. The inverse is not true, as you are unlikely to find any vendor who Walmart makes 5%+ of all their sales dollars off of. So Walmart can generally turn to any of these vendors and say - we will evaporate 5% of your sales overnight if you don't give into demand, and send all our orders to some competitor.
    - carlosjobim 3y ago
      I've never understood this. If you're not making enough profit - or even loosing money - selling to a large client, you are better off without them. Profit should come before everything else, including growth.
      - collaborative 3y ago
        Then you wouldn't exist. Even the smallest business goes through years of losses before it (hopefully) reaches profitability. Pay to sell is the only way nearly 100% of incumbents have to simply exist. If they don't do it, someone else will Traditionally, businesses build a reputation and customers learn where to find them (a physical location). They then become and stay profitable. Anyone depending on a monopolist for its pay-to-sell strategy won't usually reach profitability. The monopolist might be as small as a greedy feudal lord in the middle ages. Today we have Apple/Google etc

The book The United States of Wal-Mart by John Dicker laid this all out pretty clearly nearly 20 years ago. * corrected spelling the author's name. **https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp/1585424226 https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp...

nell 3y ago
Does this book really exist? Google search on Amazon shows no results for this.
- no_wizard 3y ago
  Appears the author's last name was a typo. Its John Dicker[0] not Decker [0]: https://www.goodreads.com/en/book/show/312990 https://www.goodreads.com/en/book/show/312990
- cptskippy 3y ago
  I miss spelled the author's last name but the result still shows up: https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp/1585424226 https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp...
- deleted 3y ago
  [deleted]
m463 3y ago
also another story: https://www.fastcompany.com/47593/wal-mart-you-dont-know-2 https://www.fastcompany.com/47593/wal-mart-you-dont-know-2
- cptskippy 3y ago
  Wow that was a oldie. Great link.

A4ET8a8uTh0 3y ago

Some context may be needed. Walmart is known in MBA circles for being one of the first companies to have used detailed data on products to negotiate new terms with suppliers ( usually to suppliers detriment ). Information asymmetry with main goal to increase a chance for an increased leverage is what it is all about.

avmich 3y ago
I wonder if the supplier can similarly have the detailed data on the customer and how that helps in negotiating both ways.
- steveBK123 3y ago
  It's asymmetrical for the most part on a lot of stuff Was listening to Bloomberg the other day and they were talking about how Walmart is the biggest grocer in US. They have pricing power because for example they constitute something over 5% of all Heinz sales. Similar for paper products from one of the big companies like Procter & Gamble. The inverse is not true, as you are unlikely to find any vendor who Walmart makes 5%+ of all their sales dollars off of. So Walmart can generally turn to any of these vendors and say - we will evaporate 5% of your sales overnight if you don't give into demand, and send all our orders to some competitor.
  - carlosjobim 3y ago
    I've never understood this. If you're not making enough profit - or even loosing money - selling to a large client, you are better off without them. Profit should come before everything else, including growth.
    - collaborative 3y ago
      Then you wouldn't exist. Even the smallest business goes through years of losses before it (hopefully) reaches profitability. Pay to sell is the only way nearly 100% of incumbents have to simply exist. If they don't do it, someone else will Traditionally, businesses build a reputation and customers learn where to find them (a physical location). They then become and stay profitable. Anyone depending on a monopolist for its pay-to-sell strategy won't usually reach profitability. The monopolist might be as small as a greedy feudal lord in the middle ages. Today we have Apple/Google etc