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Target Corporation (NYSE:TGT) And Wal-Mart Stores, Inc. (NYSE:WMT) Problem: Shoppers

Wal-Mart Stores, Inc. (NYSE:WMT) and Target Corporation (NYSE:TGT) are about to find out whether their profit strategies are working to their advantage.

The two companies that have taken up a massive retail market are expected to reveal the results of their quarterly earnings for the first quarter period. The results from the previous periods had revealed a promising chance for improved future performance for both companies. This is after some hard times that Target and Wal-Mart had gone through.

Sales had been plummeting in the United States, and the two were starting to become less of a sensation compared to previous times. The slow and unattractive times now seem to be coming to an end following major strategies employed by the two firms.

Low fuel prices, growing employment rates, and better salaries are a sign of better times ahead. Unfortunately, the only thing standing between higher profit margins for Wal-Mart and Target is the Shoppers themselves. The companies have been making very little profits as a result of diminishing clientele.

The first few months have been characterized by low retail sales despite the encouraging conditions. Other rival companies have also reported weaker sales margins in the first operating months. A few issues have been cited to take the blame for the low sales.

Research has showed that the phenomenon is mostly as a result of the shift towards online sales. The wave of online retail has taken up a massive following making it a preferable trend. The news might be working in the favor of online retailers such as Amazon, but the retail stores have already started to feel the negative effects.

Apart from the online movement, it has been established that shoppers have resulted to less shopping during the off-peak periods. They usually shop more during the holiday seasons and save up the money during the rest of the year.

Target Corporation (NYSE:TGT) and Wal-Mart Stores, Inc. (NYSE:WMT) have resulted to a management reshuffle in an attempt to raise the level of sales and coming up with new strategies that will attract more shoppers.

Published by Steve Hackney

Steve Hackney is a corporate finance professional with over 14 years of experience in cash management and investing. He earned a Bachelor of Science in Finance from Florida State University and holds a Certified Treasury Professional certification. Steve lives in Orlando, Florida with his family.

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