Friday, July 28, 2006

Wal-Mart leaves Germany

Wal-Mart has decided to give up on making a profit in Germany, which doesn't surprise me based on personal experience. When Mrs. Hippie and I lived in Munich, the only place I could think of that would carry flour tortillas was Wal-Mart. (This was before I began my personal boycott of the chain, not just for its environmental impact and abuse of our tax system, but also for its products of inferior quality.) The store was quite unusual looking, in that it defied German standards but couldn't live up to its American standards either; it was a two-story store, an still took much more ground space than most German retailers.

The parts of Germany I explored prided themselves in open-air markets and specialty shops that focus on a small range of high-quality products. Grocery stores were compact, and while I was actually able to find things like Dr. Pepper in the one I went to, it still had a very small footprint on the community. To me there's something unnatural about being able to buy a bicycle, a lawnmower and fresh fruit in the same store, and this concept is even more unappealing to many Europeans.

But Wal-Mart's failure also has to do with its philosophy of squeezing its labor force just as much as it pressures suppliers. I suspect this is ultimately what caused them to have to leave Germany, a nation with a stronger social system than ours. You can see Wal-Mart's refusal to bend to wage pressure in the US too - unlike Home Depot, Best Buy, or even Target, Wal-Mart doesn't have any stores in Manhattan.

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