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Doe 1 John Doe Professor Laurie Gazzale Microeconomics 112-OL009 24 April 2010 Economic Comparison between the Wal-Mart and Kmart Do you remember Kmart I know I still do? Maybe a few hundred stores remaining, I do not know, but the battle of the super boxes seems to have been won by Wal-Mart. Woolco, Inc. was Woolworth's entry into the big box store, and K-Mart killed them. Now, Wal-Mart and Kmart are considered two of the largest competitors in the United States retail industry. Let us examine these two in terms of their products and economic environment. 1.1 Product Lines, Description, Usage, and Demand Despite operating in the same industry, the two companies have quite distinct product lines. For instance, Kmart concentrates on a limited selection of home décor, clothing, electronics and other consumables, whereas Wal-Mart is largely an all-out retailer that stocks products ranging from groceries to stationary to construction equipment. Secondly, the merchandise on a Kmart stores depend on the specific outlet classification; the bigger one shave more collection. On the contrary, Wal-Mart stores’ merchandise is uniform; only the quantity may differ with store size. Given that, both companies are retailers, their products are likely to be affected by similar pressures on demand. However, the demand for products offered by the two firms is hugely dependent on selling price by the competitors and the proximity to competitors’ outlets. This situation has added the factor of available discounts by retailers becoming a factor, that is, demand for the merchandise increase with greater discount announcements. In addition, the availability of wide variety of goods and services affect demand. For instance, Wal-Mart sees greater demand for its products because of its “all-under-one-roof” approach; consumers
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Doe 2 therefore prefer to do most of their shopping at once instead of hopping from one shop to the other (Wal-Mart.com). 1.2
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This note was uploaded on 04/07/2012 for the course ACCT 201 taught by Professor Evans during the Spring '11 term at Thomas Edison State.

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