Wednesday, February 26, 2014

First Walmart, then Target's earnings are down

Target today reported its profit fell 46 percent after a weak holiday season. Last week, Walmart announced its profit fell 21 percent.

Today, the Washington Post reported
The results don’t surprise retail analysts, but they signal the onset of a rough year for one of the nation’s biggest retailers while the industry is already facing setbacks. The extreme winter weather, weak holiday sales, sluggish labor market and low consumer confidence have hit most retailers’ profits.
Here's the problem: Huge retailers that pay their workers low wages create poverty. And poor people can't afford to spend much at retailers, which cuts into their profit.

Impoverishing your work force is not a good business plan.