Final answer:
Walmart's creation of supercenters represents a corporate strategy of diversification by moving into the grocery market. This strategy diversified their product lines and expanded their market scope. The economic debate surrounding Walmart addresses its impact on local economies and small businesses.
Step-by-step explanation:
When Walmart decided to incorporate grocery stores into some of its locations and created "supercenters," it engaged in a corporate strategy of diversification. This strategy involved expanding into a new segment of the retail market—groceries—which was different from their original general merchandise focus. Adding groceries diversified Walmart's product offerings and allowed it to attract a new customer base while leveraging its massive supply chain and distribution efficiencies. However, this move could also reflect a form of differentiation, as Walmart's supercenters offered a unique one-stop shopping convenience that distinguished them from other non-grocery retailers. Nevertheless, the primary strategic thrust was diversification, expanding their market scope and product lines.
The economic impact of Walmart's business model has been widely debated. Local businesses typically circulate money within a local economy, but with Walmart's expansion—including supercenters—local enterprises often struggle against Walmart's economies of scale and low-cost offerings. While Walmart's practices, such as squeezing vendors to provide the lowest prices, could be seen functionally as imparting savings to consumers, they also contribute to the 'Wal-Martization' of the economy, where small businesses and the diversity of local economies decline.