Walmart is absorbing much of the tariff cost, raising prices on only about 10% of its US imports|Ben Schumin|CC BY-SA 2.0

In the tariff-driven economy, budget-conscious shoppers are reshaping retail competition.

Walmart, Amazon, and T.J. Maxx’s parent company are gaining ground by keeping prices low and offering convenience, while rivals like Target struggle.

Walmart’s strategy
Walmart is absorbing much of the tariff cost, raising prices on only about 10% of its US imports. Groceries, which remain essential even for cash-strapped households, have helped drive its US comparable sales up 4.6% last quarter.

Amazon’s advantage
Amazon streamlined its delivery network, cutting costs and speeding up shipments. That efficiency fueled an 11% jump in online sales, with executives noting tariffs haven’t yet hit its pricing.

TJX’s buying power
TJX, owner of T.J. Maxx, Marshalls, and HomeGoods, is thriving by snapping up excess inventory that other retailers over-ordered before tariffs. Same-store sales rose 4% last quarter, prompting the company to raise its outlook.

Consumers, however, remain cautious. Spending is shifting toward essentials, with many shoppers trading down, comparing prices, and holding off on big purchases as inflation and higher interest rates weigh on household budgets.