Friday, August 1, 2014
Big Box Stores are so Yesterday ?
By Krystal Steinmetz
Big-box discount retailers like Target and Walmart are not as popular with shoppers as they once were. It appears the domination of big-box stores might be coming to an end.
Goldman Sachs recently downgraded Walmart stock from “buy” to “neutral.” Meanwhile, the investment banker upgraded Costco stock to “buy,” Forbes said.
In a note to clients, the firm explained the rise of e-commerce has prompted customers to see less value in general merchandise stores with large product assortments. Shoppers now prefer a combination of value and convenience, which analysts said they have found in narrow-assortment retailers like dollar stores, drugstores and warehouse clubs.
The migration of shoppers to Amazon, Costco and smaller stores appears to be taking its toll on both Walmart and Target. Arkansas-based Walmart has experienced declining sales for five straight quarters, and its U.S. CEO was recently replaced, according to Business Insider.
Meanwhile, Target’s profit fell 16 percent in the first quarter, compared with one year earlier, The Huffington Post said.
Charles Fishman, author of “The Walmart Effect,” told HuffPo:
Everybody needs diapers and everybody needs toothpaste. People have figured out that buying it online is easy and inexpensive and you don’t have think about it.
While Walmart had $10 billion in Web sales last year, Amazon had $68 billion, HuffPo said.
Read more at http://www.moneytalksnews.com