Walmart Closing Four Chicago Stores
Walmart has announced it will shutter four Chicago area stores this Sunday, citing poor business performances as the reason for the closures.
“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 said in a statement.
The closures will take place at the Chatham Supercenter, Kenwood Neighborhood Market, Lakeview Neighborhood Market, and Little Village Neighborhood Market. While the stores themselves will close this upcoming weekend, the pharmacies will remain open for 30 days. The retail giant says all associates at the affected stores are eligible to transfer to any other Walmart or Sam’s Club facility.
Trouble may not be entirely over for Walmart stores in Chicago, but the company reportedly hopes that shuttering half its stores in the city will go some way to saving the remaining stores. “The remaining four Chicago stores continue to face the same business difficulties, but we think this decision gives us the best chance to help keep them open and serving the community,” the retailer said in a statement.
A Weaker Than Expected Outlook
The Chicago closures are part of a bigger story on Walmart’s future strategic priorities.
The retail giant posted strong revenue growth globally, but gave a weaker-than-expected outlook for the year ahead, in its Q4 2023 report. The company has also homed in on store remodels recently in an attempt to capture shopper attention for longer and have a positive impact on sales.
For example, the newly-remodeled Supercenter store in Teterboro, NJ opened earlier this year and included a refreshed interior and exterior, new signage; a reconfigured store layout; additional associate-operated register lanes; and access to top brands, and cutting-edge entertainment technology.
Digital sales were up both globally and in the U.S., and CEO Doug McMillon noted in the retailer's earnings call that e-commerce now represented more than $80 billion in sales and over 13% of Walmart's total sales. E-commerce growth was 17%, and 18% on a two-year stack. Walmart's U.S. e-commerce sales grew 12% and 23% on a two-year stack. Sam's Club's e-commerce sales were up 21% year-over-year with contributions from both curbside and ship-to-home.
