Target
We Want to Hear From You: Are Retailers' Stimulus Measures Persuading You to Spend?
Faced with a wheezing economy that can't seem to heal, big U.S. retailers like Target Corp. (NYSE: TGT) and Office Depot Inc. (NYSE: ODP) are creating their own stimulus measures to lure hesitant shoppers back into stores.
Through such tactics as loan programs, credit card rebates and gift card giveaways, top retail chains are rolling out promotional strategies, hoping to break consumers out of their anti-spending doldrums.
"A lot of the government programs have come to an end," David Bassuk, an expert from financial consultancy AlixPartners, told The New York Times. "So retailers are taking it upon themselves to do everything they can to get the consumer to spend, even opening up their wallets to give money back to the consumer."
Sam's Club is taking an unusual approach: It's offering loans of $5,000 to $25,000 to its members, backed by the Small Business Administration. Superior Financial Group is managing the loans and will give Sam's members a $100 discount on the loan application fee and lower interest rates.
Unexpected Drop in Retail Sales a Sign of Trouble For Economic Recovery
Sales at U.S. retailers unexpectedly dropped in May for the first time since September, the Commerce Department said Friday, raising worries that the economy is struggling to recover from the worst financial meltdown since the Great Depression.
Americans slashed spending on everything from cars to clothing to building materials, as retail sales plunged 1.2% last month, following a 0.6% April gain that was larger than previously estimated. It was the largest decline in eight months.
Retail sales were projected to increase 0.2%, according to the median estimate of 76 economists in a Bloomberg News survey.
We Want to Hear From You: Are U.S. Consumers Finally Willing to Spend Again? Are You?
Recent reports show U.S. consumers are spending again; some are actually even ditching the whole discount mentality in favor of luxury brands, while others are making long-delayed big-ticket purchases.
Individual spending rose for the sixth consecutive month in April, this time by 0.6%, or $36 billion. Personal income was up 0.3%. U.S. gross domestic product climbed at a 3.2% annual rate for the first three months of 2010, and U.S. factory output has risen.
"A lot of manufacturers may be struggling to keep up with demand," Russell Price, a senior economist at Ameriprise Financial Inc. in Detroit, told Bloomberg News. "We're seeing clear demand improvements from both consumers and businesses that should provide a strong tailwind for several months at least."
Shoppers Expected to Bounce Back After Snow Storm Wipes Out "Super Saturday"
After a massive snowstorm blew away "Super Saturday," last-minute shoppers are expected to make up for the lost weekend and keep retailers' holiday sales even with forecasts, the National Retail Federation (NRF) announced yesterday (Monday).
The trade group stuck to its previous projections for a 1% drop from last year's levels, saying the weather wasn't bad enough to deter shoppers from bouncing back in the last days before Christmas.
"There are more than enough shopping days to make up any challenges due to weather in the east," Matt Rubel, chief executive officer of Collective Brands Inc. (NYSE: PSS), said in an e-mail to Bloomberg News. Kansas-based Collective Brands is the owner of the Stride Rite and Payless ShoeSource chains.
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