Who Wins and Who Loses When Every Dollar Counts?

Thursday morning, Wal-Mart (WMT) reported that December holiday sales were much less than expected. It comes on the heel of reports that Americans actually cut back holiday spending this year.

Bed Bath & Beyond (BBBY) reported lower sales as consumers clearly “did not have the time,” or the money. It joined a growing list of retailers who saw sales and income drop this Christmas.

Retail outlets are having great difficulty maintaining their levels of profitability as consumers cut back - massive sales and promotions don’t seem to be doing the trick. And for investors looking to profit, the outlook doesn’t look good.

But that doesn’t mean there weren’t companies with products that didn’t fly off the shelves. Nintendo’s (NYDOY.PK) Wii consol and Apple’s (AAPL) products like the iPod and the iPhone were both in short supply in many stores.

Consumers have cut back spending, but it hasn’t dried up. Innovative and “hot” products may see the lion’s share of sales simply because consumers are trying to make every dollar count.

Comments

[brewer:]

I knew walmart was the wrong idea. WM shoppers are probably the hardest hit. Look for APPLE to have blow out sales.

Nintendo is the innovative on in the game space, and also Apple with the stunning success of the app store.

Jan 09 09:25 AM

[Zoltan L. K...:]

Consumers might cut back, but selling to businesses is the real nightmare. This is even true for former dream industries like energy, or some commodities.

Jan 09 11:47 AM

[brewer:]

Agreed Zoltan, which is precisely why Dell, HP, MSFT, etc... are going to be much harder hit than Apple. And it doesn't hurt that Apple is finally starting to sell reasonably well in business (without even trying).

Jan 09 03:14 PM

[Zoltan L. K...:]

This is it precisely, Brewer. And it was very wise from Apple not to push harder for the enterprise market, although most of those "creative" analysts argued for selling to businesses. They ment, Apple was missing a chance. Well, Apple was missing unrecoverable investments, meaning losses.

Jan 10 05:22 AM