Beginning of the Fight Concerns of Community and Wal-Mart's Approach Considering Utilitarian Ethics

1. Erhan Sozen 1
CALIFORNIA STATE UNIVERSITY, LOS ANGELES
DR.MCGUIRE
October 15, 2012
Erhan Sozen
Wal-Mart Rosemead

2. Erhan Sozen 2
Beginning of the Fight
Wal- Mart is one of the most huge and well-known retailer in the world with 6,689
retail units worldwide. In this case, Wal- Mart has decided to open a Supercenter in
Rosemead after it had faced with the successful grassroots activities by Inglewood
community, which was resulted in keeping Wal- Mart away from Inglewood. The
reason why Wal- Mart later chose Rosemead was because there were two
distribution centers and ten closely located Wal- Mart stores around Rosemead. As
it is mentioned in the case, Wal- Mart` s business strategy, economies of density,
helps reducing costs by logically locating stores and distribution centers close each
other. Thanks to density within determined radius, Wal- Mart can enjoy being
efficient on sharing resources and infrastructure. After Rosemead has been chosen
for a Supercenter neighborhood, most of the residents of Rosemead and South San
Gabriel has opposed to Wal- Mart operating in their neighborhood. Thus, they have
gotten together and established Save Our Community (SOC) in order to reserve
rights of residents and give voice to residents` concerns for a Wal- Mart Supercenter
in Rosemead. It is stated in the case that primary objections to the Supercenter
arebeing close to an elementary school, creating noise pollution around Supercenter
and having an insufficient infrastructure. However, Wal- Mart has taken action
against SOC by creating its own grassroots foundations, which are Rosemead PRIDE
and Rosemead Neighbors against recall.It is clearly seen that there was a fight
happening between SOC and pro-Wal- Mart grassroots organizations.In this case,
the main problem is that Wal- Mart has not taken social responsibility in Rosemead
since Wal- Mart did not respond residents` concerns for the existence of a
Supercenter.
Concerns of Community and Wal- Mart` s Approach
There are always objections from the community when a huge retailer decides to
open a big box retailer in their neighborhood. Normally, a socially responsible

3. Erhan Sozen 3
company tries to be compromise with the community and meets community`s
needs. But, in this case, Wal- Mart has cooperated with City Council, who gave the
approval to the Supercenter in Rosemead by a vote of five to zero. Although SOC
collected around 2,600 signatures for a citywide referendum, City Council ignored
SOC` s effort. According to the case, “ Wal- Mart had convinced the City Council
Members that it would bring new jobs to Rosemead and new sources of tax
revenue.” The newly elected City Council member John Tran, who was anti- Wal-
Mart person,stated that “the company` s claims of new jobs and tax revenues were
misleading because they failed to take into account lost jobs and lost tax revenues
from the small businesses that would be forced to close.” This is clearly against
corporate social responsibility (CSR). In the case, CSR is defined as “a socially
responsible corporation is one that runs a profitable business that takes account of
all the positive and negative environmental, social and economic effects it has on
society.” Actions that Wal- Mart take did not match with Wal- Mart` s CSR
Philosophy, mentioned in the case. In the philosophy, Wal- Mart promises to give
back to community. In contrast, for example, they paid their employees under the
industry average. Also, Wal- Mart has a past of being anti- union. Hence, Wal- Mart
closed a unionized store in Canada, which cost 190 employees job. It is
understandable that the community had concerns for Wal- Mart under these
circumstances.
Considering Utilitarian Ethics
When the situation is evaluated, it is best to apply John Stuart Mill` s Utilitarian
ethics for the favor of community. The principle of Utilitarian Ethics means bringing
the greatest good for the greatest number. Clearly, many residents did not want a
Wal- Mart store in their neighborhood for many plausible reasons such as
destroying local stores, increasing traffic and crime, and poor employee standards.

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Conclusion
A giant retailer Wal- Mart can easily penetrate the market where customers are
workers with low income like in Rosemead by offering low prices to the customers.
Also, Wal- Mart offers one-stop shopping experience by selling every product. This
leads small businesses to shut down and dominancy of Wal- Mart in the community.
As I conclude, Wal- Mart should have been more sensitive to the community and
respond their concerns instead of fighting with the community. Furthermore, I
would have followed the CSR in order to work with the community without fighting
and be a part of it.