NEW YORK – Wal-Mart, the world's largest retailer, raised prices on hundreds of toys this month, squeezing more out of sales during the biggest shopping period of the year.
Wal-Mart managers received instructions to mark up an average of 1,800 types of toys per store, according to a company e-mail dated Nov. 30 obtained by Bloomberg News. The e-mail didn’t disclose specific increases. The prices were changed “to better enable your store and the company to have a successful financial month,” according to the email.
The directive from Wal-Mart, which has about 3,800 U.S. stores, told managers to do the markups as soon as possible. The move may help Chief Executive Officer Mike Duke fulfill his October prediction that sales in stores open at least a year will be positive this quarter, after six straight drops.
“In previous years, Wal-Mart has come out and hammered everyone with unbelievably low toy prices,” said Eric Johnson, director of the Center for Digital Strategies at the Tuck School of Business at Dartmouth in Hanover, N.H. “They stepped away from that this year, and after Thanksgiving their prices have crept back up.”
Never miss a local story.
The price increases were due to temporary discounts on products, including toys, that ended Nov. 30, Ravi Jariwala, a spokesman for Wal-Mart, said in an interview. He declined to elaborate on the message’s reference to a successful financial month.
“Once a rollback ends, the item returns to its original everyday low price,” he said in an e-mail. Wednesday, the retailer announced discounts on toys that begin the night of Dec. 17, with savings such as $5 off Kung Zhu Hamsters and a $9 reduction on the Paper Jamz AC/ DC toy guitar.
Wal-Mart, the biggest toy seller in the U.S., is vying with Target Corp., Toys “R” Us and Amazon.com for sales of playthings, which may advance as much as 3 percent this year, according to market researcher NPD Group in Port Washington, N.Y. About 40 percent of annual toy sales occur in November or December, NPD said.