Wal-Mart's Market Equilibrium Oral Presentation
Tim LaBonte
ECO 561
November 3, 2014
David Flesh
Wal-Mart's Market Equilibrium Oral Presentation
Wal-Mart as a company uses the law of demand and the determinants of demand by selling as many products for a cheap price. Hence their slogan "Always Low Prices, Always." Another way that Wal-Mart uses the law of demand is by buying over $27 billion dollars' worth of merchandise that is not being made in America. Due to the abundance of goods sold overseas, like Levi's jeans and locks made from Master Lock, are being financially pushed to meet Wal-Mart's demand for low prices overseas. Wal-Mart has shown that in the event of the want in supply for its services and products the company sells they do not higher their prices.
Wal-Mart as of 2013, operates more than 11,000 stores in 27 countries around the world and manages an average of $32 billion dollars in inventory. One of the big reasons on why Wal-Mart always has inventory on stock is their cross docking method. Direct transfer of products from inbound or outbound truck trailers without extra storage, by unloading items from an incoming truck without obstruction of extra storage between the vehicles. Walmart is the worlds largest grossing company in the world, but their lack of social awareness by underpaying employees have left a spot light on the company.
Wal-Mart is one of the top ”single buyer" companies out there. From Joel Magnuson, he states Wal-Mart is a “Monopsony Capitalism.” Wal-Mart uses its power as a “single buyer” to control its production and prices. Wal-Mart took the General merchandise stores in 1992 at a 47.3 percent ratio and increased the percentage to 73.2 in 2007. Even though Wal-Mart is one of the biggest grossly income the company has a surplus website for any items that the company is liquidating.
In 2013, Wal-Mart was facing a huge