What Retail Slump? Target And Lowe's Are Doing Just Fine

Target and Lowe’s cheered everyone up by announcing that they’re doing just fine in the “tough selling market” that Home Depot was so worried about.

From Reuters:

Retail stocks have been pressured in recent weeks as investors fret that the deteriorating housing market, rising U.S. mortgage defaults and higher gas and food prices are curbing consumer spending.

Wal-Mart reported a lower-than-expected quarterly profit and cut its full-year earnings forecast last week, saying “economic pressures” like higher fuel prices have depleted shoppers’ wallets.

But Target’s sales at existing stores continue to outpace those at Wal-Mart. Its sales of cheap but trendy clothing and home decor have helped to offset sales of lower-margin goods like groceries. Wal-Mart is struggling in both its clothing and home businesses.

The Associated Press said of Lowe’s:

The nation’s second-largest home improvement chain posted higher-than-expected second-quarter profit as it gained market share and said sales trends were improving in some regions despite the soft housing market.

Poor Walmart and Home Depot. Nobody likes you.

Lowes Among Big Movers in Stock Market [Forbes]
Target profit rises and reiterates full-year view [MSN Money]
(Photo:cmorran123)

Comments

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  1. gibsonic says:

    just wait until a chinese made hammer is recalled due to metal poisoning…who knew hammers were made of metal?!

  2. JayXJ says:

    Lowes should send me a Christmas card this year. I’ve spent soooooo much there fixing up our house. :)

  3. SaveMeJeebus says:

    It is always easier to be #2. And to have cleaner stores with more helpful employees. Every time I go to Wal-Mart (only if no other option) I feel like I walked in on a state penitentiary field trip and I try to get in and out as fast as I can.

  4. anatak says:

    I love when all of this analyst speculation about what is happening in the market is shown to be complete BS.

    Lower profits couldn’t be because your store sucks, could it? Nahhhh…. housing slump. Gas prices. Lead paint. Whatever it is, its not US.

  5. foghat81 says:

    @SaveMeJeebus: agree. Within 2 miles of my house I have Target, Wal Mart, Home Depot, and Lowes. 99% of the time it’s Lowes & Target winning the head-to-head fight. For the stuff we buy, pricing is +/- 2-3% of each other so it comes down to the experience. Lowes & Target win that by a SIGNIFICANT margin. I only end up at Wal Mart if I want to be punished or at Home Depot if i need something for my Rigid shopvac

  6. JMH says:

    @gibsonic: They need to put warning labels on these hammers! I hit myself in the thumb one time and it HURT! I blame China.

  7. papa_panda says:

    Where I live, there is a Target not half a mile from the Wal-Mart, and Wal-Mart gets most of the customers, I only go to Target for things I can’t find at Wal-mart, and it’s relatively empty. Across the highway is a Lowe’s with a Home Depot right next door and it’s about even. I usually go to Lowe’s first just because it’s closer to the entrance to the parking lot.

    However since my mom got layed off from her job at Wal-Mart a couple months ago we rarely go there anymore.

  8. CumaeanSibyl says:

    The Lowe’s here still has some ex-contractor types on staff that can tell you just about anything you need to know. Home Depot? I’ve never spoken to anyone like that there.

    As for Wal-Mart vs. Target, something about the former’s cheap flickery fluorescents and disorganized shelves gives me a headache that I don’t get from Target.

    It really does come down to the experience.

  9. timmus says:

    Yeah, the Home Depot experience all around Texas has consisted of surly service, noisy forklift activity, no one around when you need them, and constant PA/intercom racket. I’ve also seen some shouting matches at the customer service desks, especially in Oklahoma. I now shop exclusively at Lowes, though one store I frequented in south Austin (Stassney & I-35) is a cesspit.

  10. gibsonic says:

    walmarts have been a hit or miss ordeal for me. There is one walmart that is the closest of 3 that are 15 mins or less away that i have absolutely boycotted. The other two are actually decent in terms of organization, cleanliness, customer service etc. Ironically, the one that is so horrible has been one of the highest grossing stores for Walmart.

  11. Ncisfan says:

    my expernce is that Lowes and Target generaly sell higher quality goods than Walmart or Homedepot do. also the experence is better at Lowes and Target and their parrent companies are less curroupt

  12. mopar_man says:

    I love Lowe’s and Target (well, as much as one can love big box stores). It’s unfortunate there isn’t either of them in my town. I avoid Wal-Mart like the plague and I only go to Home Depot if I need something urgent afterhours when the local hardware stores have closed.

  13. bohemian says:

    Walmart is an experience in pain. The place is a mess, usually full of trailer trash and screaming kids. The flickering blinding lights actually make me physically ill. I get a screaming headache, dizzy and it really bothers my eyes. I only go in there if I can’t find said item anywhere else. I have driven to multiple stores across town and paid more for something in order to avoid going into Walmart.

    Our Home Depot just quit giving a damn. Larger items are never in stock and they won’t sell the display. We were practically begging them to sell us a generator last winter and finally went looking elsewhere. Nobody is every around to help.

    Target is a much less miserable experience and the products are generally far better than Walmart.

    Lowes has a nicer store, bigger aisles and better products.

    When will businesses learn that making your customers miserable drives them away?

  14. gibsonic says:

    i think it’s time to stop kidding ourselves that the big box stores are actually trying to get ALL types of consumers. They are (secretly?) going after specific dynamics. They know they may get some percentage of other dynamics but they know where their bread is buttered.

    There is more than enough demand for the walmart experience to keep the walmart experience basically the way it is. Every few years they may freshen up a store and replace management but the thing that doesn’t change is the corporate management that dictates certain deliverables from each store which in many cases drives good store managers either away or up the ladder.

  15. bigTrue says:

    Gotta put my vote in for Target and Lowe’s. There’s a Wal-Mart a bit further then the Target, but I rarely go there unless I know something is on super sale. The store hurts my eyes.

    There’s a Home Depot and Lowe’s right next door to each other. HD has been there for years and Lowe’s just opened a few months ago. We started redoing our house with HD, so some things, like BEHR paint, we just go there for to match everything. Lowe’s feels more open, cleaner, and just friendlier. I can tell HD has felt the service hit too, since Lowe’s has been opened, I now see a ton more orange aprons running around and actively asking me if I need help finding something instead of having to hunt and beat one down for the same service.

    Since they don’t carry exactly the same thing, it depends on what I buy. I just spent 50 bucks on plastic cable raceways for the surround sound speakers I hung, but I tried Lowe’s first. Home Depot had smaller sized ones perfect for speaker cable.

  16. elf6c says:

    Maybe if Home Depot didn’t gut their customer service under their last idiot in charge (now set up to run a second rate domestic car company into the ground taking lots of Private Equity Fund money with it- which deserves a Nelson Muntz laugh on its own, but I digress. . .) they would be doing as bad as they are.

  17. mac-phisto says:

    well target’s success is definitely NOT attributable to the fact that they have one of the largest growing credit portfolios in the industry. & there is definitely no concern whatsoever that their delinquency rate is also double the national bank card average.

    nope. definitely nothing to see there. move along, please.

  18. persch5 says:

    Having been a big box manager for the last 15 years I find that the stores that are focused on employee moral first and foremost are the ones that lead the charge in great customer service. The effect had by top management at companies is that of pressure being rolled down hill into a huge snowball. That gets thrown on to the little part time associates that have boots on the ground with customers. Hence the lying to get people to by service plans or just not caring enough to learn the products they are trying to sell.

    I am now at Lowe’s. I must say that their customer complaint processing is by far the best I have found in retail. When you complain online or by phone to corporate, it immediately gets routed to the inbox of the managers and the response is timed and tracked by the manager inputing the resolution given to the customer.

    If all big boxes were truly focused on the customer instead of the shareholders, everyone’s shopping experience would be better.

  19. iKnow says:

    @gibsonic: what the f#ck does China got to do with this post.

  20. Grrrrrrr, now with two buns made of bacon. says:

    I’ve spent enough at either one that I’m pretty sure I can claim them as dependents.

  21. allthatsevil says:

    @persch5: “…stores that are focused on employee morale first and foremost are the ones that lead the charge in great customer service.” Amen to that.

    I remember when I was a kid and Wal-Mart employees were happy. They started every morning off with an employee meeting that ended in a group cheer; they hosted community gatherings; we even knew the greeter by name. Then Sam died and it all went to shit.

    As of today, I haven’t set foot in a Wal-Mart in at least two, maybe three years. I practically live at Target, and I cannot tell you how excited I was to see a sign right down the street from me announcing the location of a new SuperTarget.

    I worked at a Target over the Christmas holidays a few years ago, and while not my favorite job, it was certainly not the worst. Just the fact that I’m still willing to shop there says a lot. On the other hand, I worked at Home Depot about 8 years ago and still prefer Lowes for my home improvement needs.

  22. MrEvil says:

    Lowe’s I think is far better than Home Depot. My washing machine gave up the goat halfway through a load (started leaking onto the floor) and having saved up anticipating the purchase of a new washer. A half-hour at Lowe’s and I have a nice Maytag that is a welcome change from my 1970’s model Kenmore (no kidding, it was that old).

    The only thing I’ve bought from Home Depot was a plastic roll-away toolbox I bought to haul my computer to QuakeCon.