Retail Industry News
Retail industry faces a rout as stimulus dries up
Friday, 23, April 2010
IF Gerry Harvey didn't provide enough warning earlier this week, then Wesfarmers yesterday underlined the fact that retail stocks are set to be in the doldrums for the foreseeable future because consumer spending has slowed markedly.The third-quarter numbers sales numbers released by Wesfarmers yesterday will prompt profit downgrades today, because they came in a touch under expectations, and finance boss Terry Bowen made it clear that profit margins in general merchandisers Kmart and Target will be down in the second half of the year.
Bunnings posted relatively strong growth, but at 3.9 per cent its comparable store sales were the lowest in recent memory.Guy `Superman' Russo was again the star performer with 4 per cent comp store growth, and it seems obvious he is taking share from his comrade Launa Inman at Target, even if Bowen was at pains to say customers were trading down within -- not across -- brands.That is, instead of paying $40 for a shirt at Target, they were paying $20.
