Economic analysts pay close attention to Wal-Mart sales revenues because of Wal-Mart's sheer volume and scope. Consumer spending and also the overall health of the economy are indicated by Wal-Mart sales revenues. Many sales reports coming from leading retailers are meeting expectations. An April jobs report shows a lot more hours, more pay and a lot more hiring. Right now, Target sales are up while on the other hand, Wal-Mart sales are down. But officials that are from both companies are saying that the consumer comeback many hope will drive the U.S. economic recovery from the Great Recession may not be actually be sustainable.
Resource for this article: Wal-Mart sales revenue clouds U.S. economic recovery predictions By Personal Money Store
Sales report for Wal-Mart
Wal-Mart, the world’s largest retailer, averages a lot more than 100 million shoppers each week. More than $ 400 billion in annual sales are generated by shoppers with cash until payday loan. CNNMoney.com reports the Wal-Mart sales report shows revenues worldwide rose 6 percent to $ 99.1 billion, which certainly 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 in the 3 months ending April 30. Within the same period a year ago, same-store sales rose 3.6 percent. A 1.6 percent decline in the fourth quarter is what these sales are following.
Wal-Mart 2010 sales revenues
The fourth quarter of dragging US sales were reported by Wal-Mart sales report logs. 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 nevertheless reel from the effects of the recession on their finances. Unemployment and rising gas prices heading to 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 reported that they increased 29 percent in their income within the first quarter. The Associated Press reports that Target’s rising sales revenues are a sign the retail chain is drawing customers from competitors such as Wal-Mart. However, during a conference call to investors, Target Chairman and CEO Gregg Steinhafel said “Clearly, the economy and consumer sentiment have improved since 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.”.
2010 US economic recovery
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. As cash-strapped Americans left supermarkets and department stores, Wal-Mart's sales and profits rose during the recession. Wal-Mart appears to be losing the customers it won during the downturn as the economy gets better. Many of those customers have apparently been taking baby steps to Target.
U.S. economic recovery predictions
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. Plus, events like the stock market Flash Crash and European debt crisis have caused the rate of the retail sales increases fueled by the a lot more affluent households has slowed given that March.
US recovery is strange and long
Wal-Mart’s customer base is going to need more work and more money for them to shore up the sputtering economic recovery. The U.S. unemployment rate stuck at nearly 10 percent, the underemployment rate is increasing, wages decline for people who can find 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.
Economic recovery for US headwinds
The retail sector’s outlook, Wal-Mart’s troubles, and also 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 in the Washington Independent, Pianalto said a heightened sense of caution is driven by deep uncertainty the standard of living Americans had become accustomed to will return. Those who started their careers within the mid-1980s have experienced mostly prosperity with the exception of two very brief downturns. Expectations have shifted quite a bit due to this long and deep recession.
Citations
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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