Moral Problem of Wal-Mart - Essay Example

In most cases, the companies are normally given leeway to operate at the same level and in the same environment as other smaller companies. This is normally controversial because the smaller companies are expected to compete for the same customers as the bigger companies, even if they (the smaller companies) may sometimes have fewer resources. The matter is not helped by the fact that most governments do not have any legal frameworks to act as guides to what extent big multinationals can compete with smaller local companies (Kogel 47).

Walmart is inarguably the world’s largest retail store with operational branches in more than half of the world’s main cities. Due to its size and resources, the mega-store chain can afford to offer consumer products at relatively cheap prices as compared to other similar stores. This is normally a great problem for the smaller homegrown retail stores which have to make a profit and remain competitive at the same time. If they were to offer their products at the prices offered at Walmart, many of them would incur great losses and would have to close their business if they continued doing so. On the other hand, if they continue offering their products at prices that are higher than those offered at the popular Walmart, they are likely to lose many of their customers and this too may lead to business closure (Title 12).

This is a business moral issue that is, unfortunately, present all over the world where big established companies monopolize the market and through no fault of their own, can outdo some of their smaller competitors. In today’s world capitalism is the main basis for business operations. The presence of free markets and the lack of government control in local and international trade have meant that those companies that have the resources can set up businesses in whatever markets they deem fit (Kogel 119). This is a truly tricky situation for businesses since it means those local businesses which do not have as many resources as the multinational businesses will be negatively affected. If the multinationals come with lower-priced products, many consumers will not wait a second before they move to the new companies where they are assured of cheaper and most often better quality products (120).

However, I think this would be contrary to the ideals of capitalism and free markets which give every business the freedom to thrive in whatever environment it finds itself in. In the free world, companies are allowed to compete freely. In any case, most of the world’s multinational companies are normally seen as worthy investments in their areas of operation. Limiting how an organization operates is like putting barriers on the way to the achievement of the organization’s goals and objectives (Kogel 147). This means that the company will not make much headway in terms of profits and this will mean that government or other relevant authorities will not get as much taxes as they would have wished to get.

Although I sympathize with the small local companies which are normally affected by the presence of well-established companies in their midst, I cannot say that it is unfair for them to compete with the established companies. They all operate under the same rules and regulations and are free to do anything that is legally allowed to get and maintain customers. A company like Wal-Mart indeed has the upper hand in the market, but it is also true that customers will be loyal to a company where they receive quality services. There are many instances where multinational companies have been unable to make headway in new markets despite their competitive pricing because customers in these markets are normally very loyal to the local companies which offer value-added services and products (Title 76). Therefore, the question of multinationals enjoying market monopolies that negatively affect smaller companies should not present such a big problem, especially if the playing ground is level for all involved (Shaw and Barry 337). Rather, the smaller local companies should find creative ways of maintaining a competitive market presence instead of blaming others for their woes.