You know things are bad when Walmart is struggling.

Here’s the story about how their U.S. chain stores are doing:

Walmart, the world’s biggest retailer by sales, racked up an eighth consecutive quarter of falling sales at its established US stores as it struggles to boost its domestic business.

The US company said sales at Walmart-branded stores open at least a year fell 1.1 per cent in the first quarter from the same period last year, as analysts said high fuel prices were deterring some shoppers from driving to Walmart outlets.

However, the company’s net profit rose 3.1 per cent to $3.6bn as international sales growth outperformed the US business.

Earnings per share were 98 cents, above market forecasts and up from 87 cents a share in the first three months of last year.

The company’s shares were slightly lower, down 0.4 per cent to $55.47 in afternoon trading in New York.

Mike Duke, Walmart chief executive, said: “We recognise we still have work to do and . . . sales growth [at stores open at least a year] remains the greatest priority for me and the entire Walmart US team.”

Global net sales increased 4.4 per cent to $104.2bn from $99.8bn in 2010, led by an 11.5 per cent surge in the company’s international sales to almost $28bn.

Net US sales, which include new stores open less than a year, edged up 0.6 per cent to almost $63bn.

Mr. Duke has previously acknowledged mis-steps in narrowing Walmart’s product range and losing its focus on low prices, which the company is now seeking to correct.

Deborah Weinswig, an analyst at Citigroup, said: “The company’s initiatives . . . at the Walmart US division appear to be gaining traction, although traffic is still negative.”

Walmart’s international business accounts for about 20 per cent of sales.

Mexico, China and Chile had the highest percentage sales increases in the first quarter compared with last year.

In the UK, sales from Walmart’s Asda stores open at least a year slowed in the first three months of this year as consumers reined in spending on groceries and products such as electronics and clothing.

Asda said like-for-like sales rose by 0.1 per cent in the three months to March 31, excluding fuel and value added tax.

Removing the benefit of Easter from the year-earlier period, like-for-like sales rose 0.8 per cent.

Nevertheless, this represents a slowdown from the fourth quarter of 2010, when like-for-like sales increased 1.6 per cent.<<

Walmart is still one of the least expensive places to shop around. That they are suffering is a very bad sign for the economy, in my opinion.

Here’s an appropriate video:

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