Monday, May 26, 2014

The Economy - The Health Of Retail

There is an outstanding article on "The Burning Platform" about how retail businesses are doing. Here are the numbers the dug up:

*  Wal-Mart profit down by $220 Million and US store traffic declines by 1.4%
*  Target profit down by $80 Million, 16% lower than 2013 and store traffic declines by 2.3%
*  Sears loses $358 million and comparable store sales down by 7.8%
*  Kmart sales by 5.1%
*  JC Penney has a loss of $358 million
*  Kohl’s operating income down 17% and comparable sales decline by 3.4%
*  Costco profit down by $84 million
*  Staples profit down by 44%
*  Gap income down 22%
*  American Eagle profits down 86%, closing 150 stores
*  Aeropostale has a loss of $77 million and sales down by 12%
*  Best Buy sales down by $300 Million and comparable sales decline by 1.3%
*  Macy’s Profit Flat and comparable sales decline by 1.4%
*  Dollar General profit down by 40% and comparable sales decline by 3.8%
*  Urban Outfitters earnings down by 20%
*  McDonalds Earnings down by $66 Million and comparable sales down by 1.7%
*  Darden profit down by 30%, same restaurant sales off by 5.6% and is selling Red Lobster
*  TJX misses earnings expectations and sales and earnings flat
*  Dick’s misses earnings expectations
*  Home Depot misses earnings expectations
*  Lowes misses earnings expectations

Wal-Mart profits are down? Just about everyone shops at Walmart, so how can their profits be down? I think the economy is not recovering and that we are headed for a huge hit here. It might not happen as soon as I think it will, but it's coming. The consumer is tapped out. They have little money left to spend. When they stop spending, things are going to get ugly because so much of our economic health is predicated on consumer spending. There is an economic storm coming. It's just on the horizon and coming our way.

What do you think?

For more:
http://www.theburningplatform.com/2014/05/25/retail-death-rattle-grows-louder/