Walmart, the world’s largest retailer, has announced the abrupt closure of four of its underperforming stores in Chicago, citing millions in annual losses.
The company said that the eight Chicago stores, collectively, have not been profitable since the first store opened 17 years ago. The losses have been adding up, amounting to “tens of millions of dollars a year,” according to a press release, with the losses nearly doubling over the last five years.
The four Walmart stores that will be closed are in the Kenwood, Lakeview, Little Village, and Chatham neighborhoods of Chicago. The company stated that all employees at these four stores are eligible to transfer to other Walmart locations and will be paid through Aug. 11. Walmart’s other four stores in Chicago will remain open, the company said.
Walmart said in a press release that it had tried different strategies to improve the business performance of these locations, including building smaller stores, localizing product assortment, and offering services beyond traditional retail. “As we looked for solutions, it became even more clear that for these stores, there was nothing leaders could do to help get us to the point where they would be profitable,” the company said in a release.
The stores will close on April 16, but their pharmacies will remain open for up to 30 days. Walmart’s decision to shut down these stores comes as part of its broader restructuring plan, aimed at improving its retail operations, reducing costs, and enhancing customer service.
This is not the first time that Walmart has closed stores. According to media reports, the company announced in March that it would close a dozen or so stores. The company also announced in March that it would lay off hundreds of employees at e-commerce fulfillment centers across the country.
Walmart, as of Jan. 31, operated more than 5,300 retail locations worldwide, including Supercenters, discount stores, Sam’s Clubs, and small-format stores. The company’s total revenue in 2020 was $524 billion, with net income of $14.9 billion.
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