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Walmart: 'Going to a very dark place'


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#1 COKid

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Posted 10 August 2014 - 00:37

Walmart may not go the way of RadioShack (RSH) any time soon. But Goldman Sachs says that customers are abandoning the big-box pioneer in droves.

 

On Tuesday, the investment bank downgraded Walmart (WMT)'s stock to 'Neutral,' saying that big-box stores are losing out to online retailers and stores with more focused inventories.

 

With $469 billion in annual sales, Walmart isn't quite going out of business, but the retailer has seen sales slip for five straight quarters. Online shopping is clearly hurting the store, as more customers turn to Amazon (AMZN, Tech30) and other merchants for everyday items such as hardware and groceries.

 

E-commerce is making Walmart's vast breadth of merchandise less appealing to shoppers. Instead, customers are looking for better deals on a more narrow assortment of goods available at stores like Costco (COST) and dollar stores. The bank upgraded Costco's stock to Buy.

 

Goldman noted that Amazon's move into grocery sales is the biggest threat facing Walmart and a risk to Costco.

 

Despite the bank's pessimism about big-box retailers, maintained a 'Buy" rating on Target (TGT).

 

Source and rest of article: http://money.cnn.com...6&iid=obnetwork

 

I'm not a fan of Ghetto-Mart, but they always seem busier than Target, so I'm not sure of that last sentence. I will say that Wal-Mart's prices for groceries aren't any lower, and are often higher, than Target or King Soopers in our area. Perhaps their non-food items are lower, though. We try to avoid Wal-Marts for the most part.




#2 Hum

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Posted 10 August 2014 - 00:39

Walmart may not go the way of RadioShack (RSH) any time soon. But Goldman Sachs says that customers are abandoning the big-box pioneer in droves.

 

Good news. :)



#3 DocM

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Posted 10 August 2014 - 01:01

In Michigan they ran into a powerhouse regional chain named Meijer. They're larger (up to 200,000+ sq/ft go), have a better selection & quality (especially in produce, which is local or regionally grown), and similar prices. One stop shopping.

Area served: Michigan, Indiana, Illinois, Ohio, and Kentucky.

#4 Anibal P

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Posted 10 August 2014 - 01:06

Why go to walmart when I can go to Target with better quality, similar prices, clean stores and friendly reps that actually help 



#5 DocM

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Posted 10 August 2014 - 01:24

In these parts Target is having trouble with Meijer too. Larger selection. They're also aggressive, building 2 massive stores in Detroit where no one else would. Ones already open.

#6 Chugworth

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Posted 10 August 2014 - 01:26

Good news. :)

 

Of course I have read the horror stories of the working conditions in Amazon warehouses...



#7 Dot Matrix

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Posted 10 August 2014 - 01:29

In upstate NY, they have to contend with Wegman's (Heaven on Earth). They're no match for local businesses which produce better quality service, produce, and merchandise.



#8 Michael Scrip

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Posted 10 August 2014 - 01:34

In upstate NY, they have to contend with Wegman's (Heaven on Earth). They're no match for local businesses which produce better quality service, produce, and merchandise.

I love Wegman's!  I have family in Ithaca, NY and Wegman's is amazing.  

 

I wish we had them down south!



#9 crispkreme

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Posted 10 August 2014 - 01:58

In Michigan they ran into a powerhouse regional chain named Meijer. They're larger (up to 200,000+ sq/ft go), have a better selection & quality (especially in produce, which is local or regionally grown), and similar prices. One stop shopping.

Area served: Michigan, Indiana, Illinois, Ohio, and Kentucky.

 

A Meijer just opened by me a week ago. It has a really nice selection.



#10 DoctorD

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Posted 10 August 2014 - 02:26

Huh, upstate NY here as well.  Anyway Wal-Mart must buy the worst produce in existence, I wanted to snag some corn on the cob for dinner and Walmart sells the worst looking grey colored corn (for .50 each) I have ever seen.  Literally I don't believe I have ever looked at corn at this state of decay ever on the ground, let alone for sale at a store.  On my way to Wegman's I ended up buying corn from a road side stand for $3 a dozen.  Most of their produce is moldy looking when it is actually allergy fresh.  Their other items they sell seem to be 3rds that other stores refused to sell, I bought a grinder that didn't fit the grinder wheel. 



#11 notchinese

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Posted 10 August 2014 - 02:31

I will make a prediction right here: Everything that article says is crap. Walmart is fine. (I never shop there)



#12 Enron

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Posted 10 August 2014 - 02:31

People disliked Walmart for getting too big and displacing local businesses. It also didn't help that Walmart had less than friendly staff.

 

But why does Amazon get so much praise? They're likely to be a far worse threat than Walmart ever was.



#13 -Razorfold

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Posted 10 August 2014 - 02:49

People disliked Walmart for getting too big and displacing local businesses. It also didn't help that Walmart had less than friendly staff.
 
But why does Amazon get so much praise? They're likely to be a far worse threat than Walmart ever was.

I don't think the article's author meant to make walmart the devil and amazon the angel.

Basically his point is, brick and mortar retailers are struggling as online retailers are becoming larger and larger and that's true. Amazon's customer service has always been top notch and their prices are rarely more than the brick and mortar stores (somtimes the savings are great but usually they're about the same). Then you have the convenience of just one click shopping, I don't have to go into a store, deal with people, listen to the cashier pitch me a credit card. If I know what I want, I can buy it in a minute.

As Amazon moves into grocery I suspect things are going get much much worse for them. Most of the time I buy the same things from the store, so if I can get it cheaper (or for the same price), and get it delivered when I want it without having to waste time going to store. Why the hell not? It's not like I'll be getting different products.

Then you have wholesale retailers like Costco that are massively eating into WalMart's and Target's business. I have all 3 near me and Costco is always extremely busy while the other two's parking lots are barely ever half full.

#14 hagjohn

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Posted 10 August 2014 - 02:51

The Waltons are worth over billion dollars but refuse to give their workers enough money to live on. It's disgusting that people who work for a living still have to be on welfare because of their bosses greed.



#15 68k

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Posted 10 August 2014 - 02:58

Amazon is the last place where I'd buy groceries. I prefer supporting local organic farmers.

 

Ban Amazon from selling groceries; problem solved.