The Little Things
March 24, 2012-- Home Textiles Today,
Jennifer Marks Editor-in-Chief
The extent to which this is a positive signal for the country's home business generally links directly to whether one considers Walmart a bellwether for the health of overall retailing.
For the past three decades Walmart's fortunes served as a barometer for middle class buying habits. Walmart did well in a recession, the rule of thumb went, because it benefited from a shift to cost-consciousness. It did even better after a recession as consumers began to spend more freely.
So it's worth noting - as Walmart's chief financial officer did last week - that while the recession is technically over, Walmart's customer continues to live paycheck to paycheck. Heavy promotional activity during the fourth quarter put a $100 million dent in the company's margin.
Target, whose core customer has a somewhat higher average household income, said last week its better/best offerings in home are showing some momentum. Nonetheless, the retailer expects its home comps for the year will be flat to slightly up.
A few steps up the food chain, Macy's had a boffo fourth quarter, pointing to home textiles as one of its good performers. And at the top of the pyramid, Saks Fifth Avenue touted a "historically high gross margin rate performance."
Which brings us back to the question of whether Walmart any longer serves as the yardstick that best accurately measures the fortunes of the industry at large. Say what you will about cross-shopping, the Saks customer isn't the Walmart customer - nor is the Sam's Club customer the Family Dollar customer.
Clearly, some retailers are bouncing back more quickly than others. Formats serving the distressed lower-middle-income consumer are going to be slogging it out for a while longer.
Related Content By Author
Industry Related Content
New homes for Indo Count, Trident
Most Viewed Articles