The Real Reason Walmart, Macy’s, Kohl’s & Many Others Are Playing Retail Roulette

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It was about the damnedest couple of weeks the retail world has ever seen. And it ain’t over yet.

Unlike previous periods when certain channels of the retail pie did well and others struggled based on macro-economic and social trends, we instead saw performances all over the spectrum.

One big retail chain did very well, but the one at the other end of the mall tanked. One Big Boxer had outstanding numbers but across the highway it was an entirely different story. The only thing that was consistent was the inconsistency.

There’s a real reason for all of this dazed and confused activities in the retail sector. But first, here’s a quick look at what we’ve seen over the past few weeks as major public retail companies issued their financial results for their most recent quarters, which covered the late winter/early spring period.

Walmart/Target: Both giant discounters has rough quarters but Walmart got through it in relatively OK shape and is still fairly confident about the balance of the year. Target, on the other hand, had a rare setback on both the top and bottom lines. Its stock lost 25% of its value in one day, an insane drop for what had been one of retailing’s great ongoing success stories.

Home Depot/Lowe’s: Two more Big Boxers who showed slowdowns in business yet Depot still had some positive news while Lowe’s was far less optimistic for the rest of the year.

Macy’s/Kohl’s: Who would have guessed that Macy’s would be one of the highlights of the quarter? Well, they were, but it didn’t spread elsewhere in the department store channel with Kohl’s putting up dismal numbers and further jeopardizing its existence as an independent company.

TJX/Ross: With all the talk of the consumer being much thriftier one would have expected the entire off-price channel to excel. But that’s not what happened. TJX did just fine but Ross – Burlington too – did not and even reports of enormous amounts of goods available due to over-inventoried competitors didn’t create a lot of positive projections across the board.

Dollar Tree/Family Dollar and Dollar General: The dollar channel was a mixed bag with Dollar Tree comps up – largely because it is rolling out a higher $1.25 price tag for most of its merchandise – while both its Family Dollar subsidiary and its primary competitor Dollar General showing same store sales declines.

Other retail results in other channels were also inconsistent and when the numbers are added up at the end of the spreadsheet they show a pattern that is…well, not much of a pattern at all.

All of which raises the big question: Wazup? If we accept that the consumer is getting financially stressed and trying to economize, shouldn’t all value retailers benefit? And if the better market is holding up…well, better and consumers are spending more on clothing to wear out of their homes as they go back to the office and dress up for social occasions shouldn’t all retailers that cater to that customer be sharing in the good times?

And finally if the entire retail business is dealing with the same supply chain issues, cost increases and, more recently, inventory overload of potentially unsaleable goods, why aren’t the results more uniform?

All of these questions point to just one probably answer: Some retailing corporations are better run than others. That’s it, plain and simple. Some companies, from the CEO down to the logistics manager, the buyers and the store managers, are simply better managed and execute strategies and tactics better than others.

You have a better explanation?

And if you don’t, it’s a real eye-opening moment to judge the leadership of America’s big retailers. This Retail Roulette game is a tricky one, indeed. But this most recent financial quarter showed figuring out the winners and the losers is pretty obvious stuff.

No odds or evens, no black or red, no high or low numbers: just winning management.

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