Costco, Wal-Mart Benefit From Downturn

To the surprise of few, wholesale clubs and discounters had the strongest sales in February, as the economy continues to smack down consumers. Costco’s same-stores sales rose 7% year over year, and Wal-Mart’s chains advanced a solid (for this environment) 2.6%.

But February’s results still left us with some questions.

Apparel chains and mid-priced department stores getting hit makes sense. But weren’t a lot of people saying the luxury chains were largely immune to a slowdown? That certainly hasn’t proven true in the case of industry-favorite Nordstrom, which posted a 5.8% decline last month to follow up a 6.6% January slide.

And what is going on with Target? The retailer, which regularly outpaced Wal-Mart in same-store sales growth has lagged behind the last three months, most recently inching up only 0.5%. Is the company just faced with tough comparisons to last year’s sales, or is its bigger rival better equipped to deal with a downturn?


2 Responses to “Costco, Wal-Mart Benefit From Downturn”

  1. 1 Husky Fan In New York March 7, 2008 at 11:03 am

    Buy Nordstrom on the decline. They know retail and it’s getting more oversold. Plus it pays a decent dividend.

  2. 2 klemons June 16, 2008 at 5:41 pm

    I think Target attracts a luxury spender rather than the neccessity spender, the way that Wal-Mart does. While i love to shop at Target for their clothes, accessories, shoes, etc. some people HAVE to shop at Wal-mart fo their food, shoes, clothes, etc. Perhaps this could explain the trend.

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