Since it was founded in 1962, Wal-Mart has grown to be one of the most powerful corporations operating today. The chain controls approximately 20 percent of the entire American retail business. It has stores in the United States as well as in Mexico and Japan, and also operates in Brazil, Argentina, Canada, and China. Wal-Mart is the largest private employer in the world, and made nearly $380 billion in revenues last year. Driving across the country, it’s hard to miss the Wal-Mart Supercenters in each passing major town, and no matter how many you see, there are always cars in the parking lots.
The map above is from a paper entitled The Diffusion of Wal-Mart and Economies of Density, written by the University of Minnesota professor Thomas J. Holmes, on behalf of the National Bureau of Economic Research. For each year since 1962, Holmes plotted the locations of all new and existing Wal-Mart stores. Click here or on the map above to see a larger version of the 1979 snapshot, showing Wal-Mart’s stores across the Mississippi Valley and the southern Great Plains.
Holmes’ paper uses Wal-Mart to explore so-called economies of density–the benefits to a corporation of opening a large number of stores close together. Although these stores serve overlapping areas and sometimes compete for the same customers, they also benefit from centrally located distribution centers. Moreover, Wal-Mart uses the theories of economies of density to determine the locations of its new stores:
If economies of density were not important, Wal-Mart would go to the highest quality sites first and work its way down over time. The highest quality sites wouldn’t necessarily be bunched together, so initial Wal-Mart stores would be scattered in different places. But when economies of density matter, Wal-Mart might chose lower quality sites that are closer to its existing network, keeping the stores bunched together, putting off the higher quality sites until later when it can expand out to them.
As the years passed, Wal-Mart moved out of its core territory in and around Arkansas, and expanded nationwide. Professor Holmes created a time series map showing the growth of Wal-Mart nationwide, expanding into California, Appalachia, the Midwest, and the Northeast. Red dots represent new stores opened in each year, and blue dots represent existing stores:
Wal-Mart’s incredible growth has engendered a great deal of criticism. Some of that critical sentiment has been captured through the wonder of YouTube commenting:
“maybe we should change the name of our country to wal-mart”
“Oh my GOD, its a wal-mart plague that will swallow us all”
“looks a lot like…. cancer.”
The time series map, simply through blue and red dots, demonstrates the scale of Wal-Mart’s operations, and engenders colorful opinions from those who see it.