With the economy in the dumps and people losing their jobs left and right, Walmart (WMT) looks like a good buy; however, is the discount megastore really good for your area’s economy?
I first noticed a trend when I moved from Dallas to Washington D.C.. In Dallas, Walmarts were located in every other shopping center. Although it may sound hard to believe, there are even upscale Walmarts, with one located in an area surrounded by high profile athletes, tv personalities, oil tycoons, and, now, a certain former President.
Once I moved to D.C. it all seemed to change. In my time there, I think I might have only seen one Walmart. Now I have to admit that I am a Target shopper before Walmart, but it struck me has a little odd for the lack of Walmarts.
Over the last couple of years, Walmart has been struggling to grow. Held down by its image of a discount one stop shop, many urban areas are looking to prevent new stores from opening in their area. Numerous times Walmart has tried to open stores in and around Boston and New York, but has failed several times. The mayor of Boston is even on record stating that the store would be bad for the city’s economy. Insufficient pay and horrible benefits is not something he sees helping the area’s economy.
Across the new Yankee’s stadium in New York, a retail area placed provisions on their requirements that aimed at eliminating Walmart’s chance of building a store there. According to some of the owners in the area, Walmart would steal away loads of business from the surrounding stores. This would once again harm the area’s economy. Other areas are trying to shy away Walmart because they feel the store’s image would turn away potential home buyers.
In California the time it takes to setup a Walmart takes nearly twice as long. Internationally Walmart has suffered in Germany and finding it hard to blossom in China because of the country’s government. Over the last 5 years, Walmart has built more stores in semi-Urban places than rural, yet numbers have declined.
So, while Walmart basically dominates the heartland of the United States, there are definitily many obstacles in the way of Walmart’s future growth. Not because they can’t afford it, but because many cities are trying to prevent it from happening.