Month: September 2017

As highlighted in a recent BNN article, Walmart has released that they are partnering with a company called August Home to test out home grocery delivery services; meaning that they are coming into competition with Amazon. With the purchase of whole foods and their already established dominance over the ecommerce world,  Amazon is rapidly expanding and becoming increasingly more difficult to compete with.

If Walmart were to draw up a SWOT analysis, this would seem like a great opportunity at a first glance. It plays to their strengths, as they are a well trusted and reputable brand, which gives them an edge over startup brands in this field. Walmart is already succeeding when it comes to grocery sales and has strong ties with food suppliers, making the process of moving to online grocery sales much more efficient. However when you dive deeper, you realize that their threats may outweigh this opportunity. Amazon has also recently discovered a new connection with Olo, an online delivery network that is connected with both Chipotle and Applebee’s. This accompanied with their purchase of Whole Foods proves that they are not “just a tech company” anymore. They are already cutting whole foods prices of fresh produce making it even more difficult for walmart to keep up.

In order to standout in the online grocery world, Walmart is using what they call a “one-time passcode delivery” which gives the deliverer access to the home with a passcode that expires after one use. This way they can put the groceries directly into the fridge, attempting to give it a more personal feel. I see this as a great weakness, especially after what happened with the Equifax scandal we discussed in class. The risk of information leaks are so high right now, especially in businesses involved in this degree of competition. Technology is not always the most reliable and this advancement could be far too invasive for people to get on board with.

In my opinion, this attempt to get a creative and high tech edge may be too much for consumers to handle. Technology is not secure enough for people to trust in a company that doesn’t have a huge online security presence yet. It also may not be the right time for Walmart to try and advance into the same lane of sales as Amazon who has already made it clear that they are dominating in both the restaurant business and the online sales business.

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Let’s talk business ethics for a moment. This topic comes across as extremely controversial to most, seeing as “ethics” itself is more or less subjective. This controversy can be seen it the two pre readings, Edward Freeman’s “Stake Holder Theory” and Milton Friedman piece titled “The Social Responsibility of Business is to Increase It’s Profits”

I have recently read an article from CBC news outlining how the increase in Ontario’s minimum wage could potentially cause the loss of up to 50,000 jobs, mostly from teenage and young adult workers. The motive behind this wage hike was to attempt to minimize poverty, as a reaction to the inflating prices and cost of living. This reminded me of a theory that I read in Friedman’s piece where he states that a business man “is pre-sumably an expert in running his company – in producing a product or selling it or financing it. But nothing about his selection makes him an expert on inflation. Will his holding down the price of his product reduce inflationary pressure? Or, by leaving more spending power in the hands of his customers, simply divert it else- where?” I found this paragraph deeply thought provoking. When I had seen the original article about the Ontario wage raise I immediately blamed it on the increasing inflation due to companied being greedy for more profit, and unethically raising prices past the point that was previously considered affordable by the mass majority of consumers. Friedman is trying to remove ethics from business, but I disagree. If inflation is not an issue of business ethics then where is it coming from?

I found the two pre readings on business ethics both fascinating sides to look at. One one hand Friedman is correct in the sense that when it comes to a business, the main goal of any organization is to make a profit. We are all human and we all have a need to eat, drink water, find shelter and so on; all of these things cost money. A business is a business, if there was a desire to change the world, the CEO would have started a charity instead. However, this is not to say that businesses should never make sacrifices to their maximum profit for an ethical reason. As Edward Freeman states, we must support all of the stakeholders that helped to build our company to what it is today. Without customers, employees, and financiers there would be no business and no money to spend. We DO have a social responsibility to give back to the society in which our business is thriving.

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