Wal-Mart has ties to factories in China according to what I have read. When companies like Wal-Mart and Home Depot dominate the market, they get exclusive contracts with suppliers. While this may not be DIRECT ownership, it certainly is indirect ownership and control of those manufacturing plants. In my thinking, that is an investment in manufacturing.
So, let us say that there is a saw manufacturer that has the capacity to produce 10,000 saws a month. Here comes the big box store to handle their brand. BUT, they want 20,000 saws a month. So, the manufacturer gets big dollar signs in his eyes, and signs into a contract to produce the 20,000 saws. To do this, he borrows to buy land, equipment, and square footage for the increased production. Now, the big box store wants to get lower prices. So, they pressure the manufacturer to cut costs. Now, the manufacturer is selling saws to the big box store at cost. This means that the manufacturer is not making a profit. Loan payments are not being made. Now, the manufacturer is on the ropes, and is offered a buyout by the big box store. They have no other choice than to either sell out or go bankrupt. So who ends up owning the manufacturing?
So, here comes Sears, buying GE's Hotpoint washing machines, rebranding them as Kenmore, and competing against the Hotpoint appliances already on the market - at lower prices. How does that produce a profit? And, at the same time, the other big box stores have exclusive brands and are not competing against their own suppliers.
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Today's Featured Article - Chores - by Frank Young. The ceaseless passing of time! It is at once our friend and our enemy. It measures our progress and it makes us old. Like most features of our life, few things are all good or all bad, and most such judgments depend on our own perspective or viewpoint. In our particular hobby, we enjoy the nostalgic return to the days of our youth as we recreate many of the scenes that took place on the family farm that served as the stage for the first few acts of the play that is our live
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