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This is partly based on stuff said in the BB thread: Wal-mart might treat it's employees better, but it's cut-throat treatment of suppliers forces them to cut

by mattj 18y ago

This is partly based on stuff said in the BB thread: Wal-mart might treat it's employees better, but it's cut-throat treatment of suppliers forces them to cut their (the suppliers') employee treatment to the bone. When walmart might jump ship on sourcing from you (their purchasers are known to have zero loyalty) because it costs you $0.25 more per decorative lamp than the guy using questionable labor practices, you don't really have a choice on what to do. That $0.25 might mean very little to a small main-street (to beat the dead-horse) store, but to a company that does billions of decorative lamp sales a year, that's a ton of money. So, sure, Walmart employees might be treated fine, but the people actually producing the goods walmart sells (their non-service, indirectly employeed workers) are hurting.

showerst 18y ago
In theory, if that becomes a big enough hole, the market should rectify it on its own. You can already go to Starbucks and buy $10/lb 'Fair Trade' coffee, and many 'hip' brands (American Apparel comes to mind) trade on their humane wages and treatment of workers. I'm not saying it's a complete solution (some of the costs are still likely being externalized, although that's more a problem in the case of pollution than labor), but in general when a savings is made because of a negative externality (it's 'costing' others, instead of the just the buyers), a 'non-negative' version will spring up, and sell for a handy markup.
- forthewin 18y ago
  Sometimes the invisible hand gives you the finger; I'm willing to wager that in a lot of these cases you end up with massive barriers to entry, and so once a company gets shuttered or pushed out competitively it will take years and years before a suitable replacement appears. Not that I have any good ideas on how to make the subject better.
drusenko 18y ago
on the flipside, you also have access to a company with many multiples the distribution than your average mom and pop, so while they may not care about $0.25, you're also not going to be selling a lot to them. closing a wal-mart purchase, though, means you are going to be selling a lot of whatever it is that you make.

by mattj 18y ago

showerst 18y ago

In theory, if that becomes a big enough hole, the market should rectify it on its own. You can already go to Starbucks and buy $10/lb 'Fair Trade' coffee, and many 'hip' brands (American Apparel comes to mind) trade on their humane wages and treatment of workers. I'm not saying it's a complete solution (some of the costs are still likely being externalized, although that's more a problem in the case of pollution than labor), but in general when a savings is made because of a negative externality (it's 'costing' others, instead of the just the buyers), a 'non-negative' version will spring up, and sell for a handy markup.

forthewin 18y ago
Sometimes the invisible hand gives you the finger; I'm willing to wager that in a lot of these cases you end up with massive barriers to entry, and so once a company gets shuttered or pushed out competitively it will take years and years before a suitable replacement appears. Not that I have any good ideas on how to make the subject better.

drusenko 18y ago

on the flipside, you also have access to a company with many multiples the distribution than your average mom and pop, so while they may not care about $0.25, you're also not going to be selling a lot to them. closing a wal-mart purchase, though, means you are going to be selling a lot of whatever it is that you make.