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QUESTION
For generations, the policy of Sears Roebuck and Company, the granddaddy of retailers, was not to purchase more than 50% of any of its suppliers’ output. The rationale of this policy was that it allowed Sears to move to other suppliers, as the market dictated, without destroying the suppliers’ ability to stay in business. In contrast, Walmart purchases more and more of a supplier’s output. Eventually, Walmart can be expected to sit down with that supplier and explain why the supplier no longer needs a sales force and that the supplier should eliminate the sales force, passing the cost savings onto Walmart.
Sears is losing market share, has been acquired by K-Mart, and is eliminating jobs; Walmart is gaining market share and hiring. What are the ethical issues involved, and which firm has a more ethical position? With Cited and References.
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