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Wal-Mart forecast disappoints, food-stamp cuts hurt customers
Reuters ^ | 2/20/14 | Phil Wahba

Posted on 02/20/2014 7:14:28 AM PST by SoFloFreeper

(Reuters) - Wal-Mart Stores Inc forecast a lower full-year profit than analysts expect, as fewer food stamps, higher taxes and tighter credit erode its sales, news that sent its shares down 1 percent in premarket trading on Thursday.

The world's largest retailer expects net sales growth this year to be at the lower end of its forecast range of 3 to 5 percent, Chief Financial Officer Charles Holley said on Thursday.

Wal-Mart said comparable sales at stores open at least a year in the United States - its biggest unit - fell for a fourth straight quarter, by 0.4 percent. Overall revenue in the quarter through January 31, which includes the key holiday season, grew 1.4 percent to $129.7 billion.

A major factor in Wal-Mart's U.S. performance was a "low-single-digit decline" in sales of groceries at stores open at least a year, which generate about half of its sales.

In contrast, supermarket operators Kroger Co and Safeway Inc reported comparable sales increases for their most recent quarters.

Wal-Mart's grocery sales have suffered from fewer food-stamp benefits resulting from U.S. federal budget cuts in November. One in five of its shoppers relies on food stamps, according to Cowen analyst Tal Lev.

(Excerpt) Read more at reuters.com ...


TOPICS: Business/Economy; Culture/Society; News/Current Events; Politics/Elections
KEYWORDS: cronyism; jobs
20% of Wal-Mart shoppers are on FOOD STAMPS??
1 posted on 02/20/2014 7:14:28 AM PST by SoFloFreeper
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To: SoFloFreeper

Uh, two things to take away from this:

1. If Wal-Mart isn’t doing well, the REST of the economy isn’t doing well.

2. If Wal-Mart depends that heavily on government subsidized shoppers for income, the subsidies need to be cut....Wal-Mart needs to sink or swim in the PRIVATE sector.


2 posted on 02/20/2014 7:17:14 AM PST by SoFloFreeper
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To: SoFloFreeper

In my experience (and I worked in this industry for a number of years), if a Retail Exec misses his numbers forecast, he will grasp at ANY straw to try and explain that away.

Food stamp cuts, bad weather, political turmoil in Turkmenistan, Project HAARP, Chemtrails, Martians....whatever.

It’s all about “hang on to my job until annual bonuses are paid” and “keep stockholders from dumping their shares”.


3 posted on 02/20/2014 7:17:52 AM PST by Buckeye McFrog
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To: SoFloFreeper

Every time I go in the place it looks like 90% are in that category. That’s one reason I don’t go in that place very often.


4 posted on 02/20/2014 7:18:18 AM PST by brownsfan (Behold, the power of government cheese.)
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To: SoFloFreeper

What’s the percentage of voters on food stamps?


5 posted on 02/20/2014 7:19:13 AM PST by tgusa (gun control: deep breath, sight alignment, squeeze the trigger .......)
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To: FReepers

Click The Pic To Donate

Support FR, Donate Monthly If You Can

6 posted on 02/20/2014 7:20:17 AM PST by DJ MacWoW (The Fed Gov is not one ring to rule them all)
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To: SoFloFreeper
re: 20% of Wal-Mart shoppers are on FOOD STAMPS??

If you go to Walmart at the beginning of the month when the people on food stamps get a new infusion of funds on their EBT cards, you would think it is more like 80%. If you have to shop their at this time, the trick is to go there in the morning since most of them don't get up until noon.

7 posted on 02/20/2014 7:20:22 AM PST by Nevadan
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To: SoFloFreeper

That’s probably about right figuring around 15% of the country is on food stamps. Poor are more likely to shop at Walmart than at more expensive retail stores.


8 posted on 02/20/2014 7:22:03 AM PST by Domandred (Fdisk, format, and reinstall the entire .gov system.)
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To: SoFloFreeper

Another Walmart problem is their generic foods are dreadful... and known companies give them the bottom of the barrel of their production. Walmart’s slipping.


9 posted on 02/20/2014 7:26:18 AM PST by GOPJ ( America's drifting into totalitarianism because the left's exploitation of social failures.Greenfi)
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To: Domandred

When 1 out of 6 Americans are on food stamps or EBT, the Walmart % data in the ball park.

“Why are 47 million Americans on food stamps? It’s the recession ... http://www.washingtonpost.com/blogs/wonkblog/wp/2013/09/23/why-are-47-million-americans-on-food-stamps-its-the-recession-mostly/ - -

“There’s a fairly basic question at the core of the current food-stamp debate in Congress. Why has the program grown so rapidly over the past few years — to the point where 47 million Americans, one-sixth of the country, now receive food stamps?”


10 posted on 02/20/2014 7:32:07 AM PST by Grampa Dave ( Obozo Care is a Trinity of Lies! Obozo Care is probably a serious Black Swan event.)
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To: Buckeye McFrog
Maybe they are trying to get the sympathy of the lefties by the food stamp excuse?
11 posted on 02/20/2014 7:33:58 AM PST by celmak
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To: brownsfan

Depends on where one is. In some areas Wally World is the only large grocery store around. You can find almost anyone shopping there. In other locations that are more options and people shop by price.


12 posted on 02/20/2014 7:34:15 AM PST by Nifster
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To: SoFloFreeper

I can see Obammy and Soros in a meeting on how to cripple the World Economy. “We must cripple Wal-Mart to achieve complete control over the economy. I’ve got it! Raise the minimum wage and force them to provide Obamacare care! It will kill their profits overnight!”

“Yes Master”

“BTW I sent you another check and am working on destabilizing some other governments so you can intervene and start another war you can’t afford. Just increase taxes to pay for it. Soon my son, the Middle Class (your only opposition) will be decimated, homeless, without food, and weak if not dead. Then and you can rule as you please, unopposed”

“Yes Master. Thank you Master”


13 posted on 02/20/2014 7:37:59 AM PST by jsanders2001
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To: SoFloFreeper

If Wal-Mart isn’t doing well, the REST of the economy isn’t doing well.

*********
Not to worry. Recovery Summer 5.0 will fix everything. Happy Days will be here again soon. Let the good times roll. /sarc


14 posted on 02/20/2014 7:38:53 AM PST by Starboard
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To: SoFloFreeper
A lot of people who shop WalMart do so because they can get evertying they need there on one monthly bus ride per month. If they have less money to spend on things other than food, why go to WalMart ?

Around here, there's a local chain with better prices and better quality.

15 posted on 02/20/2014 7:41:18 AM PST by grania
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To: Nevadan

the trick is to go there in the morning since most of them don’t get up until noon.

***********
LOL!!!! But I’m sure there’s a lot of truth to that.


16 posted on 02/20/2014 7:41:42 AM PST by Starboard
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To: SoFloFreeper

Just can’t bear to go near our local Wal-Mart and tried out a store now owned by Safeway last night. If their sales are up I would have to say it is because the cost of their groceries are up. Buying fewer and fewer items each week and the cost keeps creeping upward.


17 posted on 02/20/2014 7:44:04 AM PST by Grams A (The Sun will rise in the East in the morning and God is still on his throne.)
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To: SoFloFreeper

My county has 30,000 residents. 6,000 are on SNAP. If they get SNAP, they get TANF, AFDC (or its equivalent), Section 8, EITC, ObamaPhone, heating assistance, electricity assistance, food banks, and all the other giveaway mess too.

You can drive by most any trailer in the county and the cars are there every morning until 10 or 11 AM....they can’t get up earlier than that because they are cranky when it’s that early. It upsets them.

The best time to go shopping at WalMart is in the morning before they wake up.


18 posted on 02/20/2014 7:45:09 AM PST by Gaffer (Comprehensive Immigration Reform is just another name for Comprehensive Capitulation)
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To: SoFloFreeper
20% of Wal-Mart shoppers are on FOOD STAMPS??

That's why Walmart opened grocery stores, to get on the government gravy train.

19 posted on 02/20/2014 7:45:25 AM PST by Moonman62 (The US has become a government with a country, rather than a country with a government.)
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To: GOPJ

Their teriyaki beef jerky, honey-roasted peanuts, flavored waters and some bakery goods are top notch, better than any name brand imo. Most other stuff is junk like their soups which are 2c cheaper than same size Campbells but markedly inferior in quality.


20 posted on 02/20/2014 7:55:37 AM PST by Justa
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To: SoFloFreeper

More crony capitalism.

Essentially tax payers are subsidizing Wal Mart’s profits by providing things called “benefits” to Wal Mart workers, and cash to Wal Mart customers


21 posted on 02/20/2014 7:59:58 AM PST by MadIsh32 (In order to be pro-market, sometimes you must be anti-big business)
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To: brownsfan

Same here. I stay as far away from our Walmarts as I can.


22 posted on 02/20/2014 8:04:52 AM PST by sheana
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To: SoFloFreeper

20% of US residents, including legal and illegal immigrants are on food stamps.


23 posted on 02/20/2014 8:06:37 AM PST by Eagles6 (Valley Forge Redux)
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To: jsanders2001

“I can see Obammy and Soros in a meeting on how to cripple the World Economy.

“We must cripple Wal-Mart to achieve complete control over the economy. I’ve got it! Raise the minimum wage and force them to provide Obamacare care! It will kill their profits overnight!”

“Yes Master”

Makes one wonder how much the anti Walmart Trolls on FR get paid for each of their posted anti Walmart whines.


24 posted on 02/20/2014 8:06:58 AM PST by Grampa Dave ( Obozo Care is a Trinity of Lies! Obozo Care is probably a serious Black Swan event.)
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To: SoFloFreeper

There has been no cut in food stamps. The “cut” was a reduction in growth and hasn’t gone into effect yet.


25 posted on 02/20/2014 8:41:05 AM PST by tom paine 2
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To: MadIsh32

“More crony capitalism.

Essentially tax payers are subsidizing Wal Mart’s profits by providing things called “benefits” to Wal Mart workers...”

____________________________________________________________

Yep. And there are people who will say...Why not? WalMart should take advantage of every angle the government is willing to give them....yadda yadda.

I’m getting a bid tired of subsidizing so many people and so many corporations. :)


26 posted on 02/20/2014 8:46:07 AM PST by conservaKate (R got it wrong in 2012. We must get it right in 2014 & 2016.)
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To: Eagles6

If you think food stamps are a waste, your biggest problem is not the Left nor the welfare class. It’s the army of K Street lobbyists in the employ of Armour, Kraft, Heinz, Campbells, Kroger, Safeway, Walmart, Piggly Wiggly, etc. etc. etc.


27 posted on 02/20/2014 9:05:14 AM PST by Buckeye McFrog
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To: Buckeye McFrog

LOL!

Buckeye, you win post of the day :-)


28 posted on 02/20/2014 9:29:48 AM PST by KC_Lion (Build the America you want to live in at your address, and keep looking up.- Sarah Palin)
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To: All

The fed has pumped trillions into the economy and credit is ‘tighter’? I don’t understand that.


29 posted on 02/20/2014 10:00:22 AM PST by pluvmantelo (The thing of it is, we must live with the living- Michel de Montaigne)
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To: tom paine 2
re: There has been no cut in food stamps. The “cut” was a reduction in growth and hasn’t gone into effect yet.

In addition to that fact is the fact that the number of people on food stamps has increased exponentially, so Walmart complaining about food stamp cuts makes no sense whatsoever. Their customer base purchasing with food stamps should be increasing, not decreasing. Of course, it is very probable that a lot of the food stamp money is being used to buy burgers & fries at McDonalds & Burger King as well as food at convenience stores. It has been my observation after having worked with welfare recipients and others with low incomes that most of them have no clue about how to stretch their money to get the most out of it. You can easily witness this fact at any Walmart at the beginning of the month when they have their food stamp money. Check out the carts. The overwhelming number will be filled with convenience foods, snacks, sodas, sugary cereals, and expensive meats. Very few will have actual staples in their carts such as rice, beans, or potatoes. If Michele Obama was really interested in Americans cutting back on the crap and eating more healthy diets, she could easily start by having her husband mandate (by executive order of course as he typically does) that recipients of food stamp money can no longer purchase fast food and junk food with their EBT cards. But that's not gonna happen. They won't want to get their base mad at them.

30 posted on 02/20/2014 10:01:23 AM PST by Nevadan
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To: Nevadan

I think the Execs at Wal-Mart are covering their asses for the Wall Street analysts, which is typical for publicly traded companies that miss forecast.


31 posted on 02/20/2014 10:09:53 AM PST by tom paine 2
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To: SoFloFreeper

Perhaps-—but the cut in food stamps was only 1%.

Since Wal-Mart sells many, many, many items that are not eligible to be purchased with food stamps, I think this is a bogus calculation.


32 posted on 02/20/2014 10:48:43 AM PST by ridesthemiles
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To: SoFloFreeper

Also:

I see people at the local Family Dollar purchasing items with food stamps that are more expensive than Wal-Mart.

Only reason I go there is for milk. It is closer than Wal-Mart. About 12 miles closer one way.


33 posted on 02/20/2014 10:50:07 AM PST by ridesthemiles
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To: celmak
Maybe they are trying to get the sympathy of the lefties by the food stamp excuse?

Ding ding ding... we have a winner.

34 posted on 02/20/2014 10:52:55 AM PST by Cementjungle
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To: SoFloFreeper

My “give a crap” capacity for freeloaders is exhausted.


35 posted on 02/20/2014 11:02:33 AM PST by Organic Panic
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To: Nifster
Depends on where one is. In some areas Wally World is the only large grocery store around. You can find almost anyone shopping there.

That's almost the situation in the town near me - Smith's is their only competition, and they do a good job - especially in the produce department.

36 posted on 02/20/2014 11:19:15 AM PST by Oatka (This is America. Assimilate or evaporate.)
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To: SoFloFreeper

If the Bolshies knew it was this easy to destroy Wal-Mart, they would have cut food stamps more before.


37 posted on 02/20/2014 11:28:35 AM PST by depressed in 06 (America conceived in liberty, dies in slavery.)
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To: Oatka

Folks need to look around for opportunities to purchase their groceries. Sometimes you have to shop where you have to shop


38 posted on 02/20/2014 12:54:57 PM PST by Nifster
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To: SoFloFreeper
The updated article has a lot of contradictions.
The world’s largest retailer, which gets more than half its sales from groceries, on Thursday gave a disappointing full-year forecast. It blamed sharp cuts in food stamp benefits and higher payroll taxes that will hit disposable income for its core customers. Wal-Mart shares fell 2.2 percent in morning trading. …
Good old al-Reuters could not evade reporting the truth here while trying to hide it in plain sight.

And for a company supposedly doing “bad”, they sure are expanding aggressively:
To combat sluggish sales, broaden its customer base and fend off aggressive rivals, Wal-Mart said it was doubling the number of smaller new stores it originally planned to open this year. […]

Wal-Mart now plans to open between 270 and 300 small stores this fiscal year, in addition to the 346 currently in operation, and is spending an extra $600 million to do so. It had planned to open 120 to 150 new small stores this year. Wal-Mart operates 4,000 super-centers. …
A company that is truly in retreat would not blow a significant piece of capital on such aggressive expansion.
39 posted on 02/21/2014 12:20:57 AM PST by Olog-hai
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To: SoFloFreeper

Safeway just shut down all its stores in Chicago, so of course their sales figures are up. What a dumb comparison...or intentionally misleading.


40 posted on 02/21/2014 3:37:15 AM PST by 1010RD (First, Do No Harm)
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To: GOPJ

Aldi’s!


41 posted on 02/21/2014 3:38:24 AM PST by 1010RD (First, Do No Harm)
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To: Buckeye McFrog

Spot on. It’s a gravy train, literally.


42 posted on 02/21/2014 3:39:44 AM PST by 1010RD (First, Do No Harm)
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To: 1010RD

“Safeway just shut down all its stores in Chicago, so of course their sales figures are up. What a dumb comparison...or intentionally misleading.”

Apparently, Safeway is looking for buyers, and they will be selling separately their successful gift card program for other merchants/stores.


43 posted on 02/21/2014 6:08:50 AM PST by Grampa Dave ( Obozo Care is a Trinity of Lies! Obozo Care is probably a serious Black Swan event.)
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