Question

Wal-Mart built distribution warehouses so that it can supply products to its stores within a 200-mile radius almost daily. We say that Wal-Mart has achieved:

A. empowerment
B. a competitive advantage
C. increased quality
D. increased innovation
E. none of the above

Answer 1

Wal-Mart's strategy of using distribution warehouses to efficiently supply its stores has given it a competitive advantage, similar to Amazon's business model. However, this has also led to negative impacts on local economies, known as 'Wal-Martization'.

Step-by-step explanation:

Wal-Mart has built distribution warehouses to efficiently supply products to its stores. This strategy enables Wal-Mart to maintain a constant flow of goods, ensuring that its stores can be replenished within a 200-mile radius almost daily. By doing so, Wal-Mart has achieved a competitive advantage.

This advantage stems from its ability to leverage economies of scale, much like Amazon's method of using highly computerized distribution centers to lower the cost per sale. Unlike locally owned businesses, which often circulate money within their local economies, large retail chains like Wal-Mart can sometimes negatively impact local economic structures and employment conditions due to their scale and bargaining power, often referred to as 'Wal-Martization'.