Bix Box Retailers + US No Longer the Prime Market for stuff??

Target stock has been doing worse than Wal-Mart’s for a while in a role reversal where Wal-Mart now has a higher P/E (18) than Target (13). The consumer spending slowdown and anticipated price hikes during holiday season thanks to inflation in Asia and a relatively low dollar might hit the bottom-line for retailers soon. Both Wal-Mart and Target recently started offering installation for electronics in a bid to draw more customers. Target’s installation lets you select an hour rather than a four hour slot for the installation.

Some manufacturers have started selling less in the US and concentrating more on Europe where they can charge more and margins are higher. A few months back there were rumors that Europe was getting a lot more Wiis. I can say from my personal experience that it is a lot easier to get your hands on one of the new netbooks (MSI Wind, the latest EEEPC, Acer Aspire One) etc. in Europe than in the US. Am acquaintance in UK could get her hands on all three of these in store!! I’m trying to find myself a six cell one and they are all out of stock at most online retailers in the US and the brick and mortars don’t even carry those items.

A recent article in Forbes mentioned GM shifting focus abroad because it is losing money in the US while profits are decent in the rest of the world.

The only solution out of this mess for manufacturers and retailers is raising prices to match the prices in the rest of the world and/or focusing more on foreign markets. So be warned, everything will look more expensive soon!

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