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We reported last week that “Wal-Mart’s April same-store sales, which were down 3.5 percent compared to a year ago, are said to be the worst in at least 28 years, and were even worse than expected; the company had forecast that at best its same-store sales for the month would be flat, and at worst they would be down two percent. Wrong on both counts. ”

In our commentary, we asked: How long until the “Lee Scott must go” drumbeat starts? Because there must be an increasing number of folks out there who believe that, whether or not Wal-Mart’s problems are CEO Scott’s fault, there will come a point where the company may need new leadership, new energy, and a new face at the top.

There seemed to be a general feeling that we were overstating the Wal-Mart problem, especially because its same-store sales numbers – while declining – were actually better than those generated by, say, Target during the same period.

One MNB user wrote:

Should Wal-Mart be concerned? They continue to build hundreds of new stores, sales continue to grow by the billions, and their market share is always improving.

Eventually something has to give and its going to be same store sales. I think when their market share and overall sales start to head south, that’s when they need to be concerned. Both Wal-Mart and Whole Foods have taken a beating in the stock market but both companies got way overvalued from years of hype. I think same store sales will continue to take a beating. Especially if Wal-Mart rolls out more Neighborhood Markets as they pick off A&Ps, Bi-Los, Winn Dixies, and others as they drop out. Either buy them out or run them out, Wal-Mart's market share will continue to climb.

Another MNB user wrote:

If you look at WM sales down this much for the first time you can jump to conclusions. We can talk about WM and trump "Lee Scott must go" but let's look at the timeframe.

If you look at Wal Mart and Target together . . Suddenly -3.5% does not look as bad. Now neither assumption is probably right, but I think we if have the same facts in the same day, we should look more broadly.

MNB user Bob Vereen wrote:

I'm surprised you didn't mention that so many other retailers had even greater same-store declines than Wal-Mart…While Wal-Mart can't be happy with its performance, it fared better than many others.

And still another MNB user wrote:

Let's keep April in perspective, as even Target posted a 6.1% same store sales decline for the month, and they have been outperforming Wal-Mart same store sales for the last several months. Target's overall sales for the month were down 1.8% as well, which you wouldn't expect either. I think both companies expected the soft month, but clearly not as much as actually delivered.

MNB user Tom Thomas had a thought:

Re: Same store sales dropping to 30 year lows at Wal-Mart in April…was there any offset in online sales with people opting to avoid consuming $3.40/gallon gas by shopping on the laptop?

Wal-Mart didn’t say, to the best of our knowledge. But it is an excellent point.

One of the things that we thought was interesting, and that we pointed out last week, was that Wal-Mart blamed bad weather for some of the decline.

Which prompted one MNB user to write this email…which may be as illustrative as anything we’ve heard or read about the current situation at Wal-Mart:

I wore a red white and blue badge in Bentonville for 12 years attending hundreds of the famous Saturday morning meetings and countless shareholder meetings where sales results are reviewed by all. Not once during those 12 years was anyone at any level ever able to use weather as an excuse. If you brought it up and if Sam, David Glass, Lee Scott, Tom Coughlin or any other senior level executive heard it, you were in for a butt chewing and chastised for “making excuses”.

Things must be really bad for them to trot out this worn excuse. You never hear Wal-Mart (or any other retailer) discount good result by sighting weather as the reason. I held onto my stock for several years but with zero gain I finally unloaded it. The question is not when will we start hearing calls for Lee’s ouster but rather when will Rob Walton succumb to the pressures of Wall Street and do what should have been done years ago. He is probably trying to talk Glass into coming out of retirement forget about his baseball team.

Perhaps there is a storm of change brewing in Bentonville and we are only now beginning to see the effects.

“Bad weather” seems like such a Kmart or A&P excuse. That’s why we pointed it out. It always has seemed like Wal-Mart is better than that.
KC's View: