Because of how huge Wal-Mart really is, economic analysts like to pay very close attention to Wal-Mart sales revenues. Consumer spending and the overall health of the economy are indicated by Wal-Mart sales revenues. Sales reports recently for many of bit retailers are exceeding expectations. An April jobs report shows a lot more hours, more pay and a lot more hiring. Right now, Target sales are up when on the other hand, Wal-Mart sales are down. But officials from both of the companies are saying the consumer comeback that the majority are hoping will drive the U.S. economic recovery from the Great Recession may not be sustainable.
Article Resource: 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 more than 100 million shoppers each week. Shoppers spending their fast cash generate more than $ 400 billion in annual sales. CNNMoney.com reports the Wal-Mart sales report 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 in the three months ending April 30. Same-store sales rose 3.6 percent within the exact same period a year ago. A 1.6 percent decline in the fourth quarter is what these sales are following.
2010 Wal-Mart sales revenues
Wal-Mart’s sales report logs the company’s fourth consecutive quarter of dragging U.S. 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 nevertheless reel from the effects of the recession on their finances. The Wal-Mart customer's outlook are clouded a lot more by unemployment and rising gas prices heading into the summer.
Target and their sales revenues
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 away from competitors such as Wal-Mart. Still, 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 still somewhat unstable and fragile and will likely continue to experience occasional setbacks as the year progresses amid a stubbornly high jobless rate.”.
U.S. economic recovery 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 seems to be losing the customers it won during the downturn as the economy gets better. Based on sales figures, many of those customers have taken a baby step up to Target.
U.S. economic recovery predictions
Wal-Mart might just start having to pay if they want US economic recovery to be sustainable. The CNNMoney.com article notes that retail sales expanded over the last seven months because 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
For Wal-Mart to shore up the sputtering economic recovery, they will need more work and more money. The U.S. unemployment that is around 10 percent, the underemployment rate is increasing, wages decline for individuals who can discover 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
Wal-Mart’s troubles, the retail sector’s outlook and the health of the economy at large are facing what the president of the Federal Reserve Bank of Cleveland, Sandra Pianalto, 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 will return. Those who began their careers within the mid-1980s have experienced mostly prosperity with the exception of two very brief downturns. Now expectations have shifted as a result of this long and deep recession.
More information on this topic
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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