Is it a coincidence that Walmart has announced it will close four of its eight stores in Chicago after the city recently elected Brandon Johnson as its next mayor? Johnson pushed to shift funds from police departments to social services in 2020 in a city where crime has been raging for years. Now, Walmart, which has seen its losses at Chicago stores double in the last five years, is retreating from areas of the city where it can’t make a profit. Alex Nitzberg of The Blaze reports:
Walmart announced that it will shut down four Chicago locations, noting that while four other locations will remain open, its Chicago stores have been losing money for years.
“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,” Walmart explained in a press release.
The company claims that it has endeavored to remedy the profitability problem, but to no avail.
“Over the years, we have tried many different strategies to improve the business performance of these locations, including building smaller stores, localizing product assortment and offering services beyond traditional retail. We have invested hundreds of millions of dollars in the city, including $70 million in the last couple years to upgrade our stores and build two new Walmart Health facilities and a Walmart Academy training center,” Walmart wrote. “It was hoped that these investments would help improve our stores’ performance. Unfortunately, these efforts have not materially improved the fundamental business challenges our stores are facing.”
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