I’d like to respond to some of Howard’s and Steve’s comments to my previous article, so I’ll take them in turn. Unfortunately, I’m so darn long-winded that it’s too big for a simple comment post, so its taken the form of an article:
Costco’s competition with Walmart
Howard speaks of how Costco effectively competes with Walmart effectively with unionized labor and higher wages. This may indeed be true. However, the fact is Costco does not directly compete with Walmart Stores. Rather, Costco is a more direct competitor of Sams Club, another Walmart brand. Walmart Stores are really the bread and butter of Walmart, and having said this, there is no other organization that competes effectively with Walmart on a worldwide scale, hence Walmart’s iconic status. This being the case, it might even be plausible to say that Sam’s Club could pay higher wages and unionize and still be competitive. One possible reason for avoiding this scenario is the collateral effect it would have on Walmart Stores.