Sunday, February 21, 2010

Wal-Mart and the Paycheck-to-Paycheck Consumer

This article, found at BusinessWeek.com, discusses how the recent economic downturn would affect Wal-Mart compared to similar stores. Through the current depression, Wal-Mart has had many troubles, including the decline of same-store sales and a drop in market share. An improved economy would definitely take care of these problems, however the author questions how the recession will affect Wal-Mart's competitors. According to one statistic, same-store sales at Sam's Club rose, which shows that Sam's Club's higher end customers could afford to spend more, while Wal-Mart's lower end customers felt the pinch of the economy and were forced to make due with less. There is little Wal-Mart can do to recover except for wait out the storm, which they hope will end very soon.

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