Tuesday, September 21, 2010

Monthly midnight trips to buy necessities are a sign of continued economic stress

Despite this week's announcement that the recession actually ended in June 2009, many Americans are still financially stressed. That effect may be most visible at a time and place you might not have reckoned: turn-of-the-month midnights at Wal-Mart.

Bill Simon, CEO of the company's U.S. business, said at a recent Goldman Sachs conference, "It is our responsibility to figure out how to sell in that environment, adjusting pack sizes, large pack at sizes the beginning of the month, small pack sizes at the end of the month — and to figure out how to deal with what is an ever-increasing amount of transactions being paid for with government assistance," which comes at the first of the month — at midnight, through electronic government electronic benefits cards.

"About 11 p.m., customers start to come in and shop, fill their grocery basket with basic items, baby formula, milk, bread, eggs,and continue to shop and mill about the store until midnight, when [the] cards get activated and then the checkout starts and occurs," Simon said. "And our sales for those first few hours on the first of the month are substantially and significantly higher. And if you really think about it, the only reason somebody gets out in the middle of the night and buys baby formula is that they need it, and they’ve been waiting for it." (Read more from The Wall Street Journal)

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