There was a good article in Fast Company a few years ago about Snapper lawnmowers and Walmart. It talks about the pressure Walmart applies to keep reducing cost every year and Snapper finally walking away from Walmart.

http://www.fastcompany.com/node/54763/print

I don't remember where I read it, but another good article I saw about Walmart talked about how the like to offer a range of models, like lawn mowers, where the lowest-priced one is clearly inferior quality. That convinces you that the second-cheapest model is a great value in comparison. I saw this a while ago in their DVD player lineup. The $29 model was all-plastic and didn't even have the weights manufacturers stick in products to fool you about the quality. The $59 model was just average quality but clearly looked and felt much better than the $29 model.