Retail giant Walmart announced it will close stores considered to be underperforming in five states.
The total of Walmart stores now scheduled to be shut down jumped from five to seven in one week. The news follows warnings from the company’s chief executive officer about potential price hikes due to shoplifting.
Walmart confirmed on Feb.16 that stores in Albuquerque, New Mexico; Milwaukee, Wisconsin; Bentonville, Arkansas; and Pinellas Park, Florida will close this year as well as stores in three Illinois cities – Homewood, Plainfield, and Lincolnwood.
The retail chain has been testing a pick-up and delivery location model in Bentonville since 2017 and in Lincolnville since 2019. A Walmart in Metairie, Louisiana was also a testing location and was closed in 2021.
“This decision was not made lightly and was reached only after a thorough review process,” said a Walmart spokesperson in a statement to Nexstar. “We have nearly 5,000 stores across the U.S. and unfortunately some do not meet our financial expectations. While our underlying business is strong, these specific stores haven’t performed as well as we hoped.”
On Feb. 8, Milwaukee’s city council confirmed the Walmart on Silver Spring Drive was closing.
"It's infuriating that such a massive, resource-rich, and wealthy Fortune 100 enterprise like Walmart cannot keep such an important location open,” said Milwaukee Alderman Mark Chambers Jr. in a news release, per WISN12. “The move not only negatively impacts shoppers, pharmacy customers and store workers, but I fear it will only add to the food desert issues that we are seeing in that area.”
Walmart is regularly lauded as an anti-poverty institution because of its inexpensive food prices and for providing employment in poor countries.
"Subsistence farmers earning about $1 a day can take a low- or no-skill job in a factory making products for Walmart and afford electricity and running water for the first time. Walmart not only affects their living standard but their longevity as well," wrote Forbes contributor Richard Kestenbaum in 2017.
According to digital marketing collective JungleTopp, 90% of Americans live within 10 miles of a Walmart. Over 2,000 locations include T-Mobile or Metro by T-Mobile retail centers.
Walmart's business has been challenged by the increasing popularity of online shopping as well as the demands of COVID-19-era retail requirements. The company shuttered a number of locations in recent years.
In 2022, the company closed stores in Louisville, Kentucky, Forest Park, Ohio, and Bellevue, Washington. At least 440 employees were terminated as a result. The company closed 22 stores in 2019.
CEO Doug McMillion said in December of 2022 that a rise in shoplifting has presented another significant burden for the company which would lead to more closures as well as increases in prices.
“We’ve got safety measures, security measures that we’ve put in place by store location. I think local law enforcement being staffed and being a good partner is part of that equation, and that’s normally how we approach it,” McMillon told CNBC.
“If that’s not corrected over time, prices will be higher, and/or stores will close,” he added. “It’s really city by city, location by location. It’s store managers working with local law enforcement and we’ve got great relationships there for the most part.”
