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 - New Hitches For Your Old Tractor - by Chris Pratt. For this article, we are going to make the irrational and unlikely assumption that you purchased an older tractor that is in tip top shape and needs no immediate repairs other than an oil change and a good bath. To the newcomer planning to restore the machine, this means you have everything you need for the moment (something to sit in the shop and just look at for awhile while you read the books). To the newcomer that wants to get out and use the machine for field work, you may have already hit a major roadblock. That is the dreaded "proprietary hitch". With the exception of the
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