Walmart Closes 4 Chicago Stores After Years of Losses
Walmart has reportedly shuttered half its Chicago stores while facing heavy competition for grocery customers.
The move, reported Wednesday (April 12) by Bloomberg News, brings the number of Walmart stores in America’s third largest city from eight down to four, and is happening as the country’s largest brick-and-mortar retailer is working to strengthen its digital presence.
“The simplest explanation is that collectively our Chicago stores have not been profitable since we opened the first one nearly 17 years ago,” Walmart said in a statement to Bloomberg. “These stores lose tens of millions of dollars a year, and their annual losses nearly doubled in just the last five years.”
PYMNTS has contacted Walmart for comment but has not yet received a reply. The stores — three Neighborhood Market locations and one Supercenter — are set to close by April 16.
The Bloomberg report notes that Walmart faces stiff competition in Chicago from retailers such as Target, Aldi and Albertsons’ Jewell-Osco chain, all of which have dozens of stores in the city.
The company told Bloomberg it had tried unsuccessfully to bolster its performance in Chicago with smaller stores and localized merchant offerings, to no avail. And while there was a lot of online chatter Wednesday morning about the closures being related to crime and theft, Walmart said those weren’t deciding factors.
According to Bloomberg, the decision was condemned by Chicago Mayor Lori Lightfoot, who called on Walmart to work with the community to repurpose its shuttered stores.
“Unceremoniously abandoning these neighborhoods will create barriers to basic needs for thousands of residents,” she said.
Walmart’s retreat from Chicago is happening as the company is trying to hold onto the higher-income customers who began shopping with it as inflation ticked up, as PYMNTS reported following the company’s recent investors day presentation.
“We haven’t always been able to hold on to those customers,” Walmart US CEO John Furner said earlier this month.
“Now I’m confident it can be different because we offer so many more solutions in terms of flexibility with omni-source solutions. Having these flexible options paired with great products, great prices, and great value gives us confidence in our ability to retain these customer groups.”
Walmart also recently unveiled redesigned versions of its app and website in a bid to compete with rival Amazon.
“The closest store to our customers is the one in their pockets, and we’re giving that digital storefront a revamp,” the company said last week.
“Walmart’s redesigned homepage looks sleek and attractive — and quite a bit like Amazon’s homepage, a resemblance that is likely intentional,” PYMNTS wrote following the launch. “Whether this move by Walmart will translate into meaningful gains is the key question.”
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