After years of financial difficulty, Walmart announced the closure of four underperforming locations in Chicago. Collectively, the Chicago stores have been unprofitable since the first one opened nearly 17 years ago. Despite numerous efforts to improve business performance and millions of dollars in investments, the fundamental challenges faced by these locations persisted.
The Chicago stores, which lost tens of millions of dollars annually, have seen their losses nearly double in the past five years. Walmart said in a statement that the decision to close the stores was not taken lightly, acknowledging the impact on employees, customers, and local communities.
Walmart said it will close four of its eight stores in Chicago as annual losses have nearly doubled in the past five years to “tens of millions” of dollars per year.
the DNC can rent out one of the empty stores, and also offer discounts on politicians.
— zerohedge (@zerohedge) April 11, 2023
Over the years, Walmart implemented various strategies to enhance the business performance of the stores, including constructing smaller locations, customizing product assortment, and providing services beyond traditional retail. In addition, the company invested hundreds of millions of dollars in the city, with $70 million spent in the last couple of years to upgrade stores, construct two Walmart Health facilities, and build a Walmart Academy training center. However, these investments failed to improve the stores’ performance significantly.
The company said it had worked closely with community and city leaders, who were open and supportive as Walmart shared the challenges faced by the stores. However, the company also concluded that city leaders could do nothing to help make the stores profitable.
Walmart expressed its commitment to helping the affected associates find new opportunities within the company, as they can transfer to other Walmart or Sam’s Club facilities. Hiring managers from nearby stores will assist employees in finding their next positions. In addition, Walmart will pay the associates until August 11, 2023, unless they transfer to another location before that time. Eligible associates who do not transfer will receive severance benefits.
The four locations will close to the public by Sunday, April 16, with pharmacies remaining open for up to 30 days to serve patients.
Despite these closures, Walmart emphasized its continued dedication to the Chicago community. The company has invested in local events such as Christmas in the Wards, the Always Giving Back Foundation Bike Giveaway, ChiGives Back MLK Day, and the Bud Billiken Day Parade. Walmart intends to work with local leaders to find new uses for the soon-to-be-vacant buildings, ensuring they remain important in their communities. In addition, the company plans to donate the Walmart Academy to the community to help strengthen the Chatham neighborhood and its surroundings.