When Walmart CEO Doug McMillon went to the White House last week, he said he had sent a clear message: Americans desperately need another round of stimulus checks.
Walmart’s stores and websites reflect consumer spending patterns, the retail chief said in an interview with CNBC’s Courtney Reagan on Squawk Alley. The company was able to tell when they stocked up on food and detergents at the start of the pandemic, and got interested in bikes, puzzles, and hair colors while stuck at home.
When buyers received the last stimulus checks at the end of the year, a new pattern emerged: more buyers are using the additional dollars to buy necessities.
“We can see from our customer behavior that some customers – when they received this latest incentive – are spending more on basics, more on private label, smaller pack sizes, etc., unlike some of the stimulus dollars that came out earlier last year, these were more like Tax refund checks issued where people bought televisions and things to entertain themselves at home, “he said. “There’s been a small shift in the mix now and we think this reflects the fact that customers out there need help.”
McMillon met with President Joe Biden and Treasury Secretary Janet Yellen last Tuesday along with JPMorgan CEO Jamie Dimon, Gap CEO Sonia Syngal, Lowe’s CEO Marvin Ellison and Tom Donohue of the US Chamber of Commerce. He said he asked for help to American families and small businesses during that meeting.
Congress and the Biden administration are working on a coronavirus relief bill that could send another direct payment to millions of Americans to keep families alive and fuel an economy hampered by the global health crisis. On Thursday, the Ministry of Labor reported that the number of first time jobless claims rose to a total of 861,000 last week. That was higher than the Dow Jones estimate of 773,000.
Current bill calls for direct payments of $ 1,400 per person or $ 2,800 per couple and $ 1,400 for dependent children and adults – but lawmakers are still working on a deal and the numbers could change.
If approved, it would be the third direct payment to Americans since the pandemic began and the largest check to date. The government sent payments up to $ 1,200 in the spring and payments up to $ 600 in December. However, the amounts and eligibility were based on an individual’s income.
As a large retailer, Walmart would benefit if customers had more cash in their pockets. CFO Brett Biggs told CNBC that fourth quarter earnings were up on the stimulus payments and that he would expect similar results if consumers received another check.
However, McMillon said he pointed out stimulus checks during his visit to the Oval Office because he saw and heard in the company’s stores. He said some families are in increasingly poor financial circumstances as they have difficulty finding work.
He said he recently spoke to a client who was trying to stretch $ 20 to cover all of his expenses for the last week of the month, from groceries to gasoline.
“These customers are the ones that the stimulus package needs to help quickly,” he said.
– CNBC’s Courtney Reagan contributed to this report.