Walmart Closes 269 Stores in Giant's Biggest Single Culling
Walmart is closing 269 stores globally, including 154 in the U.S., as part of a single wave of store closings.
The move covers mostly smaller stores in the U.S., including 102 Express stores that were part of a small-format pilot aimed at taking on dollar stores and hard discounters, but which never became sufficiently profitable for Walmart to expand aggressively. The U.S. closings also include 12 supercenters, six of the older-format "Division 1" discount stores, 23 Neighborhood markets, seven stores in Puerto Rico and four Sam's Clubs.
Walmart had already stopped expanding the Express pilot and moved it under the umbrella of its supermarket-size Neighborhood Markets. As Walmart has added smaller stores in recent years, efficiency has suffered. An analysis by eMarketer found Walmart's sales per store declined nearly 11% so far this fiscal year, with the metric worsening since 2011, when sales per store fell 2.5%.
In all, the move affects less than 1% of square footage, which will still likely increase for the year as Walmart adds 300 stores globally, including 50 to 60 bigger supercenters in the U.S., which have become a renewed focus for the company, and 85 to 95 neighborhood markets next fiscal year, which starts Feb. 1. Walmart has 11,600 stores globally, including around 5,200 in the U.S.
Of the affected U.S. stores, 95% are within 10 miles of another Walmart store, and they're heavily concentrated in southern states where the retailer has the greatest store density. They'll mostly close on Jan. 28, before Walmart's current fiscal year ends. The retailer is looking to place as many of the 10,000 affected employees as possible at nearby stores.
"Actively managing our portfolio of assets is essential to maintaining a healthy business," said CEO Doug McMillon in a statement. The company said the closings aim to help it better focus on strengthening supercenters, "optimizing" Neighborhood markets, growing e-commerce and expanding store pickup options. Executives in October already has said they were considering store closings, as they look to overhaul older supercenters.
The global closings include 60 money-losing stores in Brazil and another 55 unprofitable units in other Latin American countries, Walmart said.