Because of Wal-Mart’s sheer volume and scope, economic analysts pay close attention to Wal-Mart sales revenues. Wal-Mart sales revenues are used as an indicator of consumer spending and the health of the economy. Sales reports recently for numerous of bit retailers are exceeding expectations. More hours, a lot more paying, and more hiring has been shown by sales reports. Right now, Target sales are up when on the other hand, Wal-Mart sales are down. But officials from both companies are saying that the consumer comeback numerous hope will drive the U.S. economic recovery from the Great Recession may not be sustainable.
Source for this article: Wal-Mart sales revenue clouds U.S. economic recovery predictions By Personal Money Store
Sales report for Wal-Mart
In a normal week, Wal-Mart has around 100 million shoppers. Shoppers spending their emergency money generate more than $ 400 billion in annual sales. CNNMoney.com reports the Wal-Mart sales report really shows revenues worldwide rose 6 percent to $ 99.1 billion, which beat analysts’ forecasts of $ 98.45 billion. However, sales at Wal-Mart stores open at least a year — a key metric of retail performance called same-store sales — fell 1.4 percent within the three months ending April 30. A year ago, same-store sales rose 3.6 percent within the very same period. A 1.6 percent decline within the fourth quarter is what these sales are following.
Wal-Mart sales revenues 2010
Wal-Mart has reported within the sales report logs the company's fourth quarter of dragging US sales. The Wall Street Journal reports that Wal-Mart forecasted that its U.S. sales would continue to be sluggish this summer when taking into account the working-class customers who form Wal-Mart’s base still reel from the effects of the recession on their finances. Unemployment and rising gas prices heading into the summer further cloud the Wal-Mart customer’s outlook.
Sales revenues at Target
The contrast in sales revenues between Target and Wal-Mart say something about US economic recovery in 2010. Target, an emerging rival to Wal-Mart’s demographic, reported a 29 percent increase in first-quarter net income. The Associated Press reports that Target’s rising sales revenues are a sign the retail chain is drawing customers away from competitors such as Wal-Mart. Nevertheless, during a conference call to a couple of different investors, Target Chairman and CEO Gregg Steinhafel said “Clearly, the economy and consumer sentiment have improved given that the weakest point in 2009, but we believe that both are nevertheless somewhat unstable and fragile and will likely continue to experience occasional setbacks as the year progresses amid a stubbornly high jobless rate.”.
Economic recovery in the US 2010
Target, which has managed to brand itself as a Wal-Mart-type discounter with a little bit of style thrown in, took a hit during the Great Recession. Wal-Mart’s sales and profits rose during the recession as cash-strapped Americans left supermarkets and department stores in search of bargains. Wal-Mart appears to be losing the customers it won during the downturn as the economy gets better. Based on sales figures, numerous of those customers have taken a baby step up to Target.
Recovery predictions for US economy
Wal-Mart’s U.S. demographic can have to pull out their wallets for the U.S economic recovery to be sustainable. The CNNMoney.com article makes a note that retail sales expanded over the last seven months because around 40 percent of current spending comes from 20 percent of the highest incomes. Also, because of events like the stock market Flash Crash and European debt crisis, the rate of the retail sales increases fueled by some households has slowed given that March.
Long, strange U.S. economic recovery
More work and money is going to be needed by Wal-Mart's customer base if they’re to shore up the sputtering economic recovery. The U.S. unemployment rate is stuck at nearly 10 percent, the underemployment rate is increasing a lot, wages decline for people who can find any kind of work and inflation-adjusted income is flat. With the current rate of economic growth it will take at least three years to bring the unemployment rate down to be below 6.3 percent, where it was at the peak of the 2001 recession.
Headwinds US economic recovery
Wal-Mart’s troubles, the retail sector’s outlook and the health of the economy at large are facing what Sandra Pianalto, the president of the Federal Reserve Bank of Cleveland, calls a “powerful headwind.” As reported within the Washington Independent, Pianalto said a heightened sense of caution is driven by deep uncertainty the standard of living Americans had become accustomed to, in the past, will return. Consistent prosperity broken by two very brief downturns is what people who began their working careers within the mid-1980s experienced. As a result of this long and deep recession, expectations have shifted.
Read a lot more on this topic here
CNNMoney.com reports
http://money.cnn.com/2010/05/18/news/companies/Walmart_earnings/
Wall Street Journal reports
http://online.wsj.com/article/SB10001424052748703957904575252092724864622.html
Associated Press reports
http://www.google.com/hostednews/ap/article/ALeqM5j8Dci3cCwl1keQZphuso3G1zEb0wD9FQ5I6O1
As reported in The Washington Independent
http://washingtonindependent.com/85251/fed-president-predicts-a-long-slow-recovery
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