Why is Walmart closing some locations?
In Overland Park, Kansas, customers said they were shocked after the Walmart Neighborhood Market shut down this spring. Dozens of people parked their cars in the Walmart lot and walked up to the doors only to find a sign that told them the store was closed permanently.
Walmart customer Robb said it was a “total shocking surprise,” while customer Camille Tague said the closure was “really sad.”
The Overland Park Walmart had been there since the early 2000s, and customers who spoke with Nexstar’s NewsNation said it was always packed. Still, the location is part of a series of closures announced earlier this year.
And given that Walmart’s earnings are up this year, people have said the closings just don’t make sense.
“Never in a million years did you think this would close or see a Walmart closing. Why? It’s just Walmart,” Antonique Flemmons said. “Walmart has been around my whole life and you go there for things you need and you don’t think twice about it being open or closed.”
In the Chicago area, the company shuttered four locations, with the company citing poor performance.
“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. 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,” company representatives said in a press release earlier this year.
Walmart had announced plans to close the following locations as of April:
- 3701 SE Dodson Road, Bentonville, Arkansas
- 99 H Street NW, Washington D.C.
- 6900 US Highway 19 North, Pinellas Park, Florida
- 1801 Howell Mill Rd NW, Atlanta, Georgia
- 835 M.L.K. Jr Drive NW, Atlanta, Georgia
- 1032 Fort Street Mall, Honolulu, Hawaii
- 8431 S. Stewart Avenue, Chicago, Illinois
- 4720 S. Cottage Grove Avenue, Chicago, Illinois
- 2844 N. Broadway Street, Chicago, Illinois
- 2551 W. Cermak Road, Chicago, Illinois
- 17550 South Halsted Street, Homewood, Illinois
- 12690 South Route 59, Plainfield, Illinois
- 840 N. McCormick Boulevard, Lincolnwood, Illinois
- 3701 Portage Road, South Bend, Indiana
- 10303 Metcalf Ave, Overland Park, Kansas City
- 1200 Shingle Creek Parkway, Brooklyn Center, Minnesota
- 301 San Mateo Boulevard SE, Albuquerque, New Mexico
- 1123 N. Hayden Meadows Drive, Portland, Oregon
- 4200 SE 82nd Avenue, Portland, Oregon
- 24919 Westheimer Parkway, Katy, Texas
- 11400 Hwy. 99, Everett, Washington
- 10330 W. Silver Spring Drive, Milwaukee, Wisconsin
Other big box stores have tightened their belts as well. Target, Best Buy and Macy’s have all reported some brick-and-mortar closures.
Target financials show fewer people have been visiting the store, and executives expect store theft to cost them about $500 million.
And as more shoppers turn to online retail, more companies may close their storefronts.
“We are going to see that continued pressure on retailers to close their doors, especially in those urban areas,” economist Dan Roccato said. “By and large, we’ve got too much retail space in this country right now.”
By contrast, dollar stores are ramping up.
Dollar General reportedly plans to open more than 1,000 stores this year and Dollar Tree expects to open more than 600.
Despite Dollar General’s plan to open more stores nationwide, the company saw its shares fall this past week. It’s a sign that inflation still has a tight grip on Americans in this economy, and even the most cost-conscious stores may not be enough.