There's a fine line between competitive business practices and extortion. Wal-Mart walks that line as well as anyone.

The unfortunate reality is that Wal-Mart can't be blamed for behaving as they do, protecting their margins by nickel and diming suppliers is their nature. I can't believe anyone in America, or the world for that matter, is still oblivious to how Wal-Mart operates. The manufacturers have a responsibility to themselves too. It's easy to blame Wal-mart for acting how they do, and they are ruthless, but that's the game they're in.

It's not all peaches and roses for Wal-Mart. Companies that size are absolutely dependant on profitability and sustainable growth. Wal-Mart has an added dynamic in that the business they are in is typically one of low-margins and low profitability. Being cheap and tough is the only option they have to survive. Wal-Mart isn't a charity. If they slip up, things can go sour really fast.

Funny thing is, a few decades back America was worried about K-Mart and the likes as well...As Topspeed pointed out, the world largest company, General Motors, is a notoriously ruthless partner to its suppliers. When competition gets fierce, that's always been their last stand. Aside from the lousy cars they've made the last 2 decades or so, their business model is similar to Wal-Marts in that they'll either make a lot of money or lose a lot of money. It forces them to use their size to squeeze the suppliers and the competition. Now they're on the verge of bankruptcy...it happens fast.

In the case of the small suppliers getting squeezed, well, eventually the market will wisen up, and Wal-Mart will realize nobody wants to do business with them...then they'll be forced to choose between being better partners with suppliers or lose a lot of products. I'm positive they'll have strong direct competition someday, too. No empire lasts forever.