According to an August 31st story from Reuters, people on Wall Street are asking: What’s wrong with retailing these days? “Too many stores,” the article began, “too much merchandise sameness, too many financial types instead of merchants running retail companies and, especially, too many choices for consumers.” The story notes the “decline of the nation’s retail business at a time when the economy is still booming.” Many stores reported weak same-store sales growth in August, including Wal-Mart. Same store sales (sales in stores which have been open for at least one year), dropped to a 5.7% increase at Wal Mart, compared to 8.7% in August of 1999. In the early 1980s, by comparison, Wal-Mart same stores sales were has high as 18%. One Wall Street investment banker said “the real problem is that many of the old charges — too much sameness of goods, too much retailing square feet, not enough innovation — are now coming to pass and hurting…The answer is to stop opening so many stores and show some real creativeness.”
“The answer is to stop opening so many stores.” Even the analysts on Wall Street see the handwriting on the WAL. As of the end of August, Wal-Mart had 3,055 stores in the U.S., including 825 superstores. They also have more than 300 empty stores at any point in time. The US retail market is overbuilt, and even as the need for new capacity grows smaller and smaller, Wal-Mart keeps trying to expand its store count. As more stores are proposed, more community sprawl-busters organize to stop them.
