It's bound to happen. Why waste hours replacing tags when you can just change what the shelf says when the prices change.
But this article is so pro Walmart it's crazy.
Retailers argue that these innovations increase efficiency and reduce costs in an industry known for its slim profit margins.
Slim profit margins my ass. Walmarts gross profit for the twelve months ending July 31, 2024 was $163.786B,
I think the main concern is that this is a step towards normalizing extremely frequent price changes, a la Uber surge pricing.
It’ll be exciting to see prices temporarily jump during the few hours the majority of working class folk have to do their shopping.
As long as it's advertised openly, I don't see a big problem with it. It would probably be sold as a discount for shopping at slower times, though. It's a tried-and-true method of smoothing congestion.
Assuming a store with 9a-9p hours (every day), a 9-5 worker can shop 44 hours in a week, vs 40 they cannot. But that doesn't particularly line up with the busy hours. Around here, after 7 on weekdays and 5 on weekends tend to get pretty slow.
Assuming a store with 9a-9p hours (every day), a 9-5 worker can shop 44 hours in a week, vs 40 they cannot.
You can’t just logic this kind of thing out mathematically because during those 44 hours people have lives to live and obligations to fulfill. Families to manage, food to prepare, appointments to attend, plus they need to sleep. Busy shopping hours are busy for a reason. Nobody wants to be stuck in a busy shopping center. They just do because that’s the time they have to do it.
Since you are arguing from a perspective of what benefits society, I can only assume you must be a socialist.
One of the foundational principals of capitalism is that capitalists have every moral and legal right to extract as much value from society as they can and the market will regulate itself. As long as we have a capitalist system this will always be the default position of the general public and our politicians.
Huh. TIL only socialists argue from a perspective of what benefits society...
It's price gouging, pure and simple. There's no positive to it whatsoever
You're thinking logically and with the desire for good service. I assure you they are not.
If capitalists valued the public good instead of profit min-maxing then they wouldn't be capitalists. They'd be some kind of socialist, probably market socialist (co-ops owned by workers or the public.)
It will become an Olympic event where you have to get from the shelf to the till before the price changes!
That’s exactly what this is. All stores will eventually do this and prices will fluctuate throughout the day.
Slim profit margins my ass. Walmarts gross profit for the twelve months ending July 31, 2024 was $163.786B,
Walmart has 10.5k locations. 163B divided by 10.5K is about $15.6M per location.
Jesus, in what world is $15M profits per store location considered a "slim margin"?
"Gross profit" is a meaningless number in this context. Their net income was $15.5B. If you do the same math to try to determine profit per location, ($15.5B/10500) it's about $1.48M. Not bad, but still about 90% lower than your estimate.
Since I was already estimating seemingly random profit ratios, I also looked at their profit per employee, which came out to $7380/person ($15.5B/2.1M employees).
Unfortunately these numbers are also inclusive of, for example, Walmart's e-commerce program, so calculating the profit per location doesn't indicate anything meaningful to me, though I'm morbidly curious about what insights you are hoping to get from it?
Slim profit margins my ass. Walmarts gross profit for the twelve months ending July 31, 2024 was $163.786B,
Not to sound flippant, but do you know what gross profit means? They aren't pocketing all of that. Walmart's net profit margin is 2.66%, which is minuscule. They make up for that by having enormous volume.
That's an expected tradeoff of operating an essential service is the point. It's not as though their margin is that slim by mistake, or out of goodwill, or bad business sense. It's meant to lead to the situation where we shop at Walmart not by choice, but in lieu of other options.
Not really — it's because nearly everything they sell is highly fungible, and they compete on price. Nobody is willing to pay a premium to shop at Walmart. Twenty years ago you'd have been correct, but they've pretty much saturated the market at this point. They're trying to find profitability in automation rather than adding tons of new stores.
I'm really meaning the lack of option not to consume fast-moving consumer goods, rather than the option to pay a premium for them elsewhere. When their market position is similar to like an outlet for government rations except for private profit, their net is essentially what was skimmed off the top of free enterprise. 2.66% is just the current maximum amount that is justifiably worth without doing societal harm
It's bound to happen. Why waste hours replacing tags when you can just change what the shelf says when the prices change.
But this article is so pro Walmart it's crazy.
Slim profit margins my ass. Walmarts gross profit for the twelve months ending July 31, 2024 was $163.786B,
I think the main concern is that this is a step towards normalizing extremely frequent price changes, a la Uber surge pricing.
It’ll be exciting to see prices temporarily jump during the few hours the majority of working class folk have to do their shopping.
As long as it's advertised openly, I don't see a big problem with it. It would probably be sold as a discount for shopping at slower times, though. It's a tried-and-true method of smoothing congestion.
Assuming a store with 9a-9p hours (every day), a 9-5 worker can shop 44 hours in a week, vs 40 they cannot. But that doesn't particularly line up with the busy hours. Around here, after 7 on weekdays and 5 on weekends tend to get pretty slow.
You can’t just logic this kind of thing out mathematically because during those 44 hours people have lives to live and obligations to fulfill. Families to manage, food to prepare, appointments to attend, plus they need to sleep. Busy shopping hours are busy for a reason. Nobody wants to be stuck in a busy shopping center. They just do because that’s the time they have to do it.
Since you are arguing from a perspective of what benefits society, I can only assume you must be a socialist. One of the foundational principals of capitalism is that capitalists have every moral and legal right to extract as much value from society as they can and the market will regulate itself. As long as we have a capitalist system this will always be the default position of the general public and our politicians.
Huh. TIL only socialists argue from a perspective of what benefits society...
It's price gouging, pure and simple. There's no positive to it whatsoever
You're thinking logically and with the desire for good service. I assure you they are not.
If capitalists valued the public good instead of profit min-maxing then they wouldn't be capitalists. They'd be some kind of socialist, probably market socialist (co-ops owned by workers or the public.)
It will become an Olympic event where you have to get from the shelf to the till before the price changes!
That’s exactly what this is. All stores will eventually do this and prices will fluctuate throughout the day.
Walmart has 10.5k locations. 163B divided by 10.5K is about $15.6M per location.
Jesus, in what world is $15M profits per store location considered a "slim margin"?
"Gross profit" is a meaningless number in this context. Their net income was $15.5B. If you do the same math to try to determine profit per location, ($15.5B/10500) it's about $1.48M. Not bad, but still about 90% lower than your estimate.
Since I was already estimating seemingly random profit ratios, I also looked at their profit per employee, which came out to $7380/person ($15.5B/2.1M employees).
Unfortunately these numbers are also inclusive of, for example, Walmart's e-commerce program, so calculating the profit per location doesn't indicate anything meaningful to me, though I'm morbidly curious about what insights you are hoping to get from it?
Not to sound flippant, but do you know what gross profit means? They aren't pocketing all of that. Walmart's net profit margin is 2.66%, which is minuscule. They make up for that by having enormous volume.
That's an expected tradeoff of operating an essential service is the point. It's not as though their margin is that slim by mistake, or out of goodwill, or bad business sense. It's meant to lead to the situation where we shop at Walmart not by choice, but in lieu of other options.
Not really — it's because nearly everything they sell is highly fungible, and they compete on price. Nobody is willing to pay a premium to shop at Walmart. Twenty years ago you'd have been correct, but they've pretty much saturated the market at this point. They're trying to find profitability in automation rather than adding tons of new stores.
I'm really meaning the lack of option not to consume fast-moving consumer goods, rather than the option to pay a premium for them elsewhere. When their market position is similar to like an outlet for government rations except for private profit, their net is essentially what was skimmed off the top of free enterprise. 2.66% is just the current maximum amount that is justifiably worth without doing societal harm