Originally posted by stevegmu
I can't imagine Walmart would have trouble with their line of credit. Most likely the ship from China is late.
What people are missing here is that Walmart doesn't manufacture all of what it sells, does it?
Even if it has a "Walmart" label on it, it's likely manufactured by a small company and then packaged for Walmart.
It's all very good saying Walmart are not having financial problems themselves, but what about the smaller companies they buy in from? They are
having financial problems.
The Ma & Pa stores going under in large numbers are the same sorts of companies supplying the big chains. They can't secure the money and credit to
buy materials for manufacture, and they are having to cut back on production.
Walmart makes orders in bulk based on expected sales, so they may even be deliberately cutting back on specific items based on a previous forecast
that they won't sell many in a struggling economy.
Then you have the shipping and haulage companies cutting back too, or simply going out of business.
This affects everyone from manufacturing companies to the bulk buyers like Walmart.
Walmart will have stock in some regions, probably in locations where their stores are larger and sales higher in the past. But there will be an
availability problem on a lot of goods simply because of all the factors that caused businesses to cut back or go out of business a couple of months
ago.
If anyone can find data on when small business closures were at a peak, you'll see a pattern. If in July/August there was a peak of businesses in
manufacture going under, supplies of their items will be missing from the shelves of the larger retail chains who buy from them a couple of months
later, unless they found another supplier.
Produce growers will face similar problems but their time scale is different so that would be seen more immediately.
It's really just common sense. If the smaller businesses are struggling to make ends meet and going under in record numbers, the people who buy from
them will face a shortage. Walmart is nothing more than a middle man, buying in bulk from them at low prices and selling on to you.