Punchinello’s Chronicles

November 16, 2008

Too Poor to Shop at Walmart

Filed under: Butterfly Wings — Punchinello @ 4:46 pm
Tags: , , , , ,

With the increasing pressure on the middle class, less money to spend, and economic worries affecting consumer shopping. Walmart is doing very well. They’re projections are a bit lower than previous ones, but overall, the mainstream economists and financial gurus are happy. They say that as money dries up, more people will shop at the discount retailers.

But there’s an interesting, counter-intuitive truth that nobody’s yet talking about. At the bottom level, when literally every penny counts, quality matters. In fact, quality becomes a function of survival.

Imagine that you happen to enjoy mountain climbing. You’ve decided to climb a particularly treacherous peak down in Peru, and there’s going to be lots of snow, ice, unexpectedly fierce storms, and probable avalanches. Off you go, you and your friend, and you climb most of the way up the mountain.

There you are, at a high altitude on a frozen mountainside and your foot slips. Down you slide, faster and faster, approaching a sheer cliff with a 3,000 foot drop. All that’s going to stop you from plunging to your death is the rope and shackles you have. They connect you with your friend, and there are a couple of spikes driven into the snow.

How much do you trust that $3 rope you bought at Walmart? And how ’bout that deal you got on the aluminum spikes from China?

When I first started going broke, I did all the things everyone is doing now. In my own little microcosmic way, I was just like the macrocosmic system. Each idea I had was pretty much the same as what everyone else would have. I had many levels of financial backup, all of which collapsed, one after another. But I still had some money.

To cut costs, save money and keep going, I shopped more and more at Walmart. I couldn’t shop at better stores, “better” meaning higher prices for higher quality. And still, I slid downward, faster and faster. It was like loosing my footing on the side of that mountain.

There came the time when I had no more money. I scrambled for whatever pick-up work I could find, stopped paying debts, had no more credit, no nothing. And still, I slid downward, even faster. Everything was a blur, chaos was everywhere, and each month was a nightmare of worrying about whether or not I’d be out on the streets.

People said I could always stay with them. Fine, except I’d have to lose everything I’d ever accumulated. And then what? When I got back on my feet I’d have to rebuild an entire life, reacquire furniture, pots, pans, shoes, clothes. All of it would be gone while I slept on someone’s couch. Panic and terror came to visit and decided to stay for awhile.

Government subsidies, charity, bottom-level public aid and some major scrambling kept the roof over my head and some nominal food on the table. Everything else had to stop. Credibility vanished, and the maw of the abyss opened up. Desperation stopped by to chat with panic and terror, and they all started having a grand old time.

In that desperation, ideas for entrepreneurial ventures started flying around like mosquitoes. One of them looked workable, involving sewing and fabric. But how to come up with the money for even a prototype? Walmart.

We (a friend of mine who’s a seamstress) started at Walmart, buying quarter yards of inexpensive material. We had lots and lots of free time, being utterly destitute, so we invented, experimented, worked and did as many trials as we could afford. At last we found a way to make the product, and tried selling on eBay. Those were the days (last year) when eBay still was affordable at only about a dollar for a 7-day ad.

The metaphorical rope snapped like a whip, there was a massive yank, my bones jangled. I slammed to a stop about 1 inch from the edge of the cliff. We had only a single chance, maybe once a month, to provide an unknown customer with this one single product we could make from home. The $35 or $50 would literally make the difference between keeping an apartment or being evicted.

We were fortunate. We had just enough money to make one iteration of the product. The money we got from selling that single item financed just enough fabric to make another one. The rest went for food and rent. Walmart was inexpensive enough that we could barely afford to buy the fabric. Then Walmart decided to get out of the textile business.

So we went on a hunt, discovering that very few stores sell fabric anymore. Nobody sews much, other than with computerized machines used for embroidery. Joann’s was about it, for low-end fabric. So we switched, breathing a sigh of relief. We could still buy quarter yards and make single products, one at a time.

No, we couldn’t afford a business ID number, what with a credit rating somewhere around -2,000. No, we couldn’t buy direct, not when we’d have to purchase an entire bolt each time. Retail was our only choice.

Very gradually, we started selling two items per month, and so we could invest just a little more in fabric. We bought envelopes to ship the product, and found a place that sells out-lots of weird things. They had plastic bags for 5-cents each, and we found some inexpensive rope at Walmart to hang our product. Then Walmart stopped carrying that rope.

One night, we got a large order. It would be enough that we could finally buy a whole yard of fabric, get ahead of our production, and perhaps sell a few extra items. We still needed tools and things to make the product, but we’d been doing it all by hand. The extra money from a larger order would at least get us the necessary tools. We bought a few whole yards of the colors we needed from Joanns.

Finishing the product, we were about to ship. Everything was riding on the order and the customer’s satisfaction. We’d used the money to buy the materials, having no money left if they wanted a refund. We had less than $4 to our total net worth, with zero assets left at all. If this order wasn’t satisfactory, we’d not only be out of business, we’d have no food to eat.

And that’s when we noticed a serious flaw in the fabric on one part of the product.

Looking at the remaining scrap, working out the math, we were able to figure out a way to just barely recover and make that part of the product with a bit of remaining material. We packed it up, put it in the envelope, and without any pressure the envelope fell apart. We’d bought that box of envelopes at Walmart, cheap.

We can’t afford Walmart anymore. Even though we have to scrimp and save, putting off other necessities, we have to buy higher-priced fabric now. We absolutely need the quality so that we don’t throw away half of what we buy at Joann’s. We had to use gas, time, energy, and work to find someplace where we could even buy quality fabric. But we found it.

At this point in our lives, the only thing keeping us from being homeless is a single product. It’s something we can make, requires a lot of time, but we’re so broke all we have is time. Customer satisfaction and quality control absolutely must be at 100%. There’s zero room to maneuver, and zero room for flaws.

We can’t afford the crap fabric we found at Joann’s. We can’t afford to throw out half of each minimal purchase for flaws we find only near the final completion of the product. The math provides us with the bare minimum, cut perfectly in order to produce our item. If any of it at all is wrong, breaks, tears, or falls apart, we can’t make it up. Above all, we can’t in any way afford to offer refunds because we’re at the most basic level of bootstrapping.

The low quality products we used to buy at Walmart are getting even lower. Nothing in their product line remains constant, with anything at all subject to disappearing without notice. The shelves are often empty, and whatever it is we find that worked, they don’t carry anymore. Same with all the discount chains. It’s just not “cost effective,” we hear, for the discount chains to carry anything on a regular, ongoing basis.

Now, at the real bottom of the economy, totally broke, hanging on by our fingernails, we simply can’t afford to shop the cheap places. Each and every thing we buy, most of which goes toward the products we try to sell, all of it has to be perfect. There’s no room for error. We can’t buy it again, get another version, or “hope” that it’ll stay together during shipping and transportation.

Right now, it seems to a lot of other people that shopping for cheaper goods is a way to save money. But if they ever reach the level of raw survival, that’s when everyone will discover that quality matters. There’s a reason you pay more for boots, coats, gloves, jeans, shirts, and everything else. There’s a reason you pay more for quality rope when you’re climbing a gigantic, thoroughly dangerous mountain.

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