Walmart Closes 4 More Urban Locations In Retreat From City Centers
Walmart is closing four of its eight Chicago stores, the company announced Tuesday, the latest in a wave of urban-area closures: It plans to close 19 U.S. locations across 11 states, from Hawaii to Wisconsin.
Walmart attributed its decision in Chicago to poor economic performance citywide, especially in recent years.
"We know the community will have questions about why we are closing these locations," the company said in a release. "The simplest explanation is that collectively our Chicago stores have not been profitable since we opened the first one nearly 17 years ago — these stores lose tens of millions of dollars a year, and their annual losses nearly doubled in just the last five years."
Walmart's other four Chicago stores are facing these same issues, it said, but the company hopes the closures will help bolster demand for those locations.
Chicago’s closings are part of a shuttering surge. Just last month, Walmart closed stores in Washington, D.C., Albuquerque, New Mexico, Pinellas Park, Florida, and Portland, Oregon.
In February, Walmart announced the closure of three technology hubs in Portland, Austin, Texas, and Carlsbad, California, forcing workers there to relocate if they wanted to keep their jobs.
This year, the company has already laid off thousands of employees in warehouses that serve e-commerce fulfillment, and it is closing the last of its pickup locations in Arkansas and Illinois, a program it piloted in 2014.
E-commerce in general, though, is retaining its pandemic-era momentum. The National Retail Federation predicts nonstore and online sales to grow between 10% and 12% this year, to a range of $1.41T to $1.43T.
The company’s downsizing and reorganizing coincides with a wage increase to workers. Beginning in March, the company raised its hourly minimum wage from $12 to $14 per hour, a move Walmart predicted would lift its average hourly pay from $17 to $17.50 an hour.
Post-pandemic inflation is a major hindrance to companies like Walmart, whose marketing revolves around its affordability. The Bureau of Labor Statistics’ consumer price index out Wednesday shows all items up 5%, and food prices are up 8.5% year-over-year.
Walmart is known for keeping its prices relatively consistent across locations, and it recently pushed back on price hikes from suppliers.
As of Jan. 31, Walmart operated 5,317 stores in the U.S.
