A few months ago, I wanted to compare prices on some air
conditioners Wal-Mart sold.
GE 8000 BTU ASW08FC
GE 6000 BTU AGW06LC
Could not find those anywhere on the Internet except at Wal-Mart.
Lately I have been looking at carpet cleaners. Specifically the
Hoover Agility Deep Cleaner.
Apparently Wal-Mart is the only store that sells that part number.
Don't try to price compare something like a window AC based on model
number or even manufacturer. Simply look for the cheapest unit of the
number of BTU you need. Also figure in electrical usage and go with
the one that has the lowest TCO (total cost of ownership). You might
also find a used unit for $10 if you only look.
Hope this helps,
This practice is ubiquitous among manufacturers and chains, certainly
in consumer electronics. I've seen a S*ny tecnician look at a part
number and say "that was bought at Se*rs". In some cases there's just
one digit or letter difference in the part number.
It's to confuse comparison shoppers (and maybe indie repair shops) and
squirrel of out we'll-beat-their-price guarantees.
Not a good example -- Manufacturers make stuff to Sears specs,
just like they do for Walmart. Most consumer electronics
purchased at Sears, for example, must be serviced by Sears if
warranty service is needed. A lot of electronics manufacturers
make special items just for Sears and Walmart.
Chip C wrote:
Because Walmart demands such low prices the manufacturers have to make
cheaper versions. If you were able to compare the components you would
find features such as a lower quality motor, cheaper bearings, lighter
weight moulded parts etc.
I spoke to a friend who is the CEO of a bicycle manufacturer about his
dealings with Wal-Mart. He said he's happy to sell to them, but only on
condition that his company's name does not appear on the product, because
of what he's forced to do in order to meet their pricing policies.
Examples: Fewer spokes in the wheels, vinyl instead of leather saddles,
plastic where metal should be used, unsmoothed welds, no primer, less paint,
etc. You only get what you pay for. A great majority of Wal-Mart merchandise
is built to a price point, rather than a quality/feature level.
maybe because they PAY faster than do most of the mom-and-pop
Greenpeace-bumpersticker-next-to-my-PETA-bumpersticker bicycle shops?
If you want to build your own bicycle, you're welcome to build it
with any amount of gold plating that you want. If you want Walmart to
stock bicycles, I guess you're gonna have to accept the product
selection that works for THEM.
Not necessarily -- from what I've heard from those in the industry,
Wal-Mart generally signs consignment deals with suppliers. Meaning,
the supplier does not get paid until the item is purchased from
I'll bet none of the mom-and-pop-Greenpeace-bumpersticker-next-to-my-
PETA-bumpersticker shops get those terms. They probably get net 30 days,
or maybe net 60, if they are lucky.
"Never ascribe to malice what can equally be explained by incompetence."
no one held a gun to the bicycle-CEO's head and forced him to sign a
deal with Walmart. He did it to make the money he needs to play
i'm-a-trendy-bicycle-purista rolegames with his branded product. He's
probably thanking his lucky stars that he gets the sales. Walmart
wouldn't have any problem to bring bikes in from China, you know?
Those who are creditworty, receive credit. If the bicycle-CEO isn't
giving Walmart-flavored terms to the Greenpeace-bumper-sticker
moms/pops, it probably reflects his actual market experiences with
Not to get racial. but the Chinese people didn't fall off the
haywagon yesterday. They are up there with the Jews when it comes to
business smarts. I don't think many round-eyes are gonna be able to
fool a chinese sales manager.
I bet the manufacturer passes title to the goods when the bicycles are
delivered to his own truck dock. Didn't you ever notice that Walmart
has its own fleet of 40-footer shipping containers? If you're not in
the habit of taking delivery of merchandise as "ex-works" INCOTERMS,
you wouldn't bother owning shipping containers.
I think it's a 50-50 chance that Walmart will acquire a controlling
share of a Taiwanese shipping company in the next decade. Why pay
Also true in supermarkets. But... I think you're confusing apples and
oranges. The manu... no, let's not say manufacturer, if you were
Hallmark, you probably wouldn't bother trying to be a printer.... the
branded-product-concept organization, PAYS RENT for the shelfspace or
displaycase footprint. i guess there's some that pay a cut of the
turnover to the store.
In consignment, the store doesn't even HOLD TITLE to the goods, they
are just a bailee.
If you know how to use advertising to train consumers to want your
brand-name on the box as well as Proctor & Gamble does, for example,
you'd rather have total control of the merchandising.... you'd be happy
to pay the rent. The markup on these generic chemicals is incredible,
you can afford it. You tell the chemical-plant guy to dropship another
million gallons of shampoo formula #1347 (you can SEE these
formulations on the Net, published by the chemical houses who supply
the key supplemental ingredients (eg, surfactants). You tell your
plastics convertor to dropship another 2 million of the containers.
there's a third contractor who fills 'em and palletizes, then directly
ships to individual supermarket locations. Every niche is a niche.
I doubt that many factories in chinese provinces are accepting gizmos
back across the Pacific. Last few times I looked at the ocean-freight
shipping business, there was a lot of empty 40-footers piling up in the
Usa after they carried goods from china.
There's distressed-goods guys that will take mom-and-pop's inventory
off their hands (at a steep discount) if Pop decide that the items
aren't "making the rent" due to slow sales.... My *impression* is
that walmart doesn't indulge in that very often. There's not many guys
who find a niche at beating Wally's cost-of-operations or guess at
shopper's tastes better than he does.
Like I said, I don't know modern marketing. But
if the goods are on consignment, then what does
that have to do with this thread? Somebody
actually manufactures stuff to Walmart's specs and
then sells it in the store on consignment? Seems
like all the risk would be on the manufacturer.
"consignment" is really the wrong term, George is talking about "leased
departments" whereby the building (store in this case) simply rents out space
to the seller(s). Its done to save the store the hassles of managing
specialized departments while allowing the store to have a lot of different
items available to the customers in the building. Example: The "girls" are
looking at jewelry and the guy wanders off to the tools department.
Actually, according to one report I saw, at least some of the materials
on sale in Wally-World (and other mass merchandisers as well) are on
consignment--mostly, the perishable goods is what that report implied.
In W-M, whole departments are actually sub-contracted to other invisible
operators (shoes, cameras, not sure what else)...
The point is there is a veritable web of differing marketing tactics
underway--virtually all of the points made in the thread have varying
levels of accuracy and the same techniques aren't universally applied to
Not the case with any of the stuff I buy at
Costco. Either the number is identical to that
sold at other stores, or it is indeed a special
number which reflect that because there are two or
more units in a package and/or the package
includes more accessories or the units have more
features than normally included in the units sold
As for Walmart, I have no vested interest and but
I wonder about some of the Walmart bashing.
Recently I noticed that Walmart and Lowes (about
200 feet away) sold the same low priced BBQ. Both
had it for the same price but at Lowes, the tank
was extra and at Walmart it was included.
I have no idea what Walmart pays to various
manufactures, but I do know that
Walmart's prices are often as high or higher than
I pay at some other stores.
I find the same at BJ's also. Wal-Mart puts the emphasis on low prices.
Costco, BJ's put the emphasis on quality at "wholesale" prices.
I've often heard stories from local dealers selling tools that the ones at
HD and Lowes are cheaper versions, even though the model number is the same.
Every time I ask exactly what the difference is, they cannot give me
specifics. I don't doubt it is possible, but I've yet to have someone tell
me something like a motor winding or gear set, etc is really different.
I do know three specific cases told to me by trusted friends who work in
responsible positions at manufacturing companies.
One is the food chemist at a major canned goods manufacturer. He has to
be aware of all the costs and also the selling price. He said Walmart
names the price when they buy the product "we want 3 million cans of
xxxxx and we will pay you $0.21/can". Since that is less than their cost
he specs a special run with less of the expensive components. Another is
at a paper goods manufacturer. Walmart buys in the same fashion (he said
they pay about 85% of what any other customer would pay). When they run
that batch they do every thing possible to minimize the amount of raw
material and fluff up the paper as much as possible. Ever wonder why a
12 pack of "wallys best" weighs about 2 ounces and has 20 feet on a
roll?. Another works for a lead acid battery maunfacturer. He said
Walamrt also names their price and a "custom" run is done to meet the
If you don't like those crappy products, then buy
a different brand. You can buy day old bread
(often several days old) at a much cheaper price
also. It is obvious to any careful consumer that
some brands are better than others, and it should
be obvious that some people can't afford to buy
the the top brands that provide quality and
consistency. Most stores, including Walmart,
provide a variety of brands, so you can pick what
If, however, you are saying those are major brands
of canned goods that are sold under the same name
in many stores, but those sold in Walmart stores
are inferior, you have a problem. It is not
I don't see the problem. This is a free country
and a manufacturer doesn't need to sell to Walmart
at a lower price and a consumer doesn't need to
buy inferior goods. Sell, buy, do what you want.
It's not like the government is forcing you to
do anything. But of course, people who will pay
$50 or $100 for a meal at a restaurant will
probably be the biggest protesters. OTOH, I
won't pay more than $10 for a meal and I would
never dream of buying a little 2-ounce piece of
meat with 3 ounces of veggies for $20 just for the
chance of having a hateful waiter spit on it.
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