The Associated Press has a story on Wal-Mart’s decision to close a number of its stores. Mashable has chosen to run it with the headline “Amazon wins again as Walmart cuts 10,000 jobs and 269 stores all over the world.” But there actually doesn’t seem to be much in the story itself to support the alarmist headline. Even the story itself notes:
The stores being shuttered account for a fraction of the company’s 11,000 stores worldwide and less than 1% of its global revenue.
The closures aren’t exactly “all over the world,” either. More than half, 154, are in the US, and the rest are largely in South America, especially Brazil. Asbury Park Press has a list of exactly which US stores are closing. Most of them are the smaller-format Wal-Mart Express or Wal-Mart Neighborhood Market stores. Time pegs their failure on Wal-Mart’s unsuccessful attempt to replicate the supercenter shopping experience in a smaller store. Wal-Mart’s supply chain is optimized to support larger format stores, but the same strategies don’t work for mini-markets.
There’s nothing in that to indict Amazon, except perhaps indirectly. Amazon, after all, doesn’t have to worry about what kind of selection it can pack into a retail store, because it can sell you anything in its warehouses—and it can deliver its electronic goods, such as e-books, music, or movies, right away. Wal-Mart isn’t in the same position, and its own attempt to run a digital music store effectively fizzled. It’s probably just as well it never tried getting into e-books!
The reason Mashable chose to call out Amazon in the headline is, of course, that Amazon is seen as Wal-Mart’s chief competitor these days when it comes to carrying everything and selling at discount prices—so, when Wal-Mart “loses,” naturally Amazon has to “win.” It’s the same sort of thinking that accounts for big publishers and various interest groups associated with them being so scared of Amazon these days—Amazon is “winning,” therefore, they must be “losing.” Didn’t you know, commerce is a zero-sum game?
This kind of alarmist thinking really does explain a lot about the current publishing market, and perhaps other markets Amazon is involved in as well. Any time some company has any trouble, it’s second nature to look around for some convenient scapegoat. And the company that’s doing well in those markets is a natural fit.
The funny thing is, aside from the fact that most of the stores being closed weren’t of a format Wal-Mart was properly equipped to exploit, the store closures make up a little over 2% of Wal-Mart’s total global storefronts, and as stated, less than 1% of its global revenue. Wal-Mart could have closed that many stores at any time for any reason, even without Amazon—it’s just a statistical hiccup compared to its total infrastructure. But it’s something people can blame on Amazon, or at least call out Amazon for benefiting from.
This is the way it goes when a company is successful—everyone looks to blame their failures on it. And while it’s true some of those failures are its fault, not everyone who places blame is careful to sort just those bits out.