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 McDonald's, Walmart Feel The Pinch 
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Location: Friendswood, TX
Post McDonald's, Walmart Feel The Pinch
McDonald's, Walmart Feel The Pinch As Low-Income Shoppers Struggle In The Slow Recovery

By Phil Wahba and Lisa Baertlein

Aug 16 (Reuters) - From Wal-Mart Stores Inc and Gap Inc to Macy's Inc and McDonald's Corp, chains that cater to middle- and lower-income Americans say they are feeling the pinch of an uneven economic recovery.

A host of retailers have reported tepid sales lately, highlighting the stress that consumers are feeling because of higher payroll taxes, expensive gasoline and a slow job market four years after the U.S. economy started to rebound.

"Everyone wants to talk about recovery - it's like the unrecovery," Susquehanna Financial Group analyst Bob Summers said following the Wal-Mart results. "The demographic that they cater to, not only has it not seen improvement, I would argue that things have gotten worse."

Look no further than Macy's for a snapshot of the consumer. For its namesake mid-tier department stores, Macy's reported the first decline in same-store sales in nearly four years this week, and said shoppers had been gravitating to its less expensive items. That's a contrast with Macy's upscale Bloomingdale's, which came in with strong results.

The trend also turns up in results posted on Thursday by Wal-Mart, which emphasizes low pricing. Its U.S. sales at stores open at least a year unexpectedly fell 0.3 percent last quarter, a second decline in a row, prompting the world's largest retailer to lower its sales forecast for the year.

Last week, a group of U.S. retailers including Costco Wholesale Corp and Gap reported modest gains in July same-store sales, thanks largely to bargains.

Adding to the pressure, Macy's said many shoppers are redirecting their spending to their cars, housing and home improvement.

Automakers reported a 14 percent U.S. sales increase in July from a year earlier, industry consultant Autodata Corp said.

Wall Street analysts expect home improvement chain Home Depot to report same-store sales rose 7 percent, the biggest gain of any major retailer Thomson Reuters tracks.

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Read more here: http://www.huffingtonpost.com/2013/08/16/mcdonalds-walmart-low-income-shoppers_n_3765489.html?utm_hp_ref=business

I have a few comments about this article - and it's tone.

First, too many folks in my area are sick to death of Walmart and its policies. We are tired of shopping with a retailer that a) takes massive state tax breaks; b) pays its employees a pittance; and c) costs the state taxpayers enormous sums in Medicaid and free school breakfasts, lunches and food stamps due to said HR policies.

As to Macy's - there is a huge boycott going on in Texas right now because Macy's had the audacity to write our Governator and ask that he veto (along with other retailers, I might add) a law passed by the Texas legislature that enables female victims of job discrimination to more easily sue for redress.

Thirdly, in my home, sweet, home too many folks have taken the Dave Ramsey financial classes at church. They are sick to death of buying junk and stuff they don't need. Folks I know are successfully paying down credit cards, saving for vacations and doing home improvement.

Lastly, I find the tone of this article offensive. The very idea that only "middle and working class" folks shop at Macy's, Walmart or McDonalds is simply untrue. I think the reporter(s) should have done their homework rather than sticking to a political line.

Jest my two cents...

_________________
The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little. - FDR


Sun Aug 18, 2013 8:16 am
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