Retail giant Walmart announced Tuesday that it is closing down of its stores in the Chicago area because none of the stores have been profitable and “lose tens of millions of dollars” annually, according to a news release.
After about two decades of continual losses, Walmart said that it also invested “hundreds of millions” of dollars into the four locations, according to the release. However, that still hasn’t helped the firm turn a profit in the area, it said.
“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 press release said. But Walmart said that after millions of dollars in investments and “many different strategies,” it has to cut its losses in the area.
“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,” Walmart’s release said. “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 said that the four locations will be shut down on Sunday, April 16, “to the public.” Pharmacies at the four locations will remain open for another 30 days, the Arkansas-based company added.
The locations that are being closed are as follows: #5781 Chatham Supercenter, the Walmart Health center, and the Walmart Academy, 8431 S. Stewart Ave.; #3166 Kenwood Neighborhood Market, 4720 S. Cottage Grove Ave.; #5645 Lakeview Neighborhood Market, 2844 N. Broadway St.; and #5646 Little Village Neighborhood Market, 2551 W. Cermak Road.
“We will work with local leaders to help find reuse options for these buildings, so they remain important parts of their communities, including the Walmart Academy, which we intend to donate to the community to help further strengthen Chatham and the surrounding neighborhoods,” the news release said.
Walmart still has at least four other stores located around Chicago, the firm said. However, those locations may not remain there much longer, the news release suggested.
“The remaining four Chicago stores continue to face the same business difficulties,” Walmart said, “but we think this decision gives us the best chance to help keep them open and serving the community.”
The news release said that workers at the soon-to-be shuttered locations are now eligible to transfer their jobs to “any other” Walmart or Sam’s Club location and that all associates will be paid until Aug. 11, 2023—unless they transfer. Representatives from other Walmart or Sam’s Club facilities “will be in each of these stores to help” workers transfer, it said.
The head of Citadel, billionaire Ken Griffin, specifically cited Chicago’s crime rate as a reason to leave during an interview with the Wall Street Journal last year. Citadel and Griffin ultimately relocated to Miami, Florida.
“If people aren’t safe here, they’re not going to live here,” he told the paper. “I’ve had multiple colleagues mugged at gunpoint. I’ve had a colleague stabbed on the way to work. Countless issues of burglary. I mean, that’s a really difficult backdrop with which to draw talent to your city from.”
Earlier this year, former Chicago Mayor Lori Lightfoot, a Democrat, lost her bid for reelection amid claims that she could not address the city’s high crime numbers. Chicago has reported around 700 murders each year for 2020, 2021, and 2022.
Outside of Chicago, Walmart closed its final two stores in Portland, Oregon, due to a wave of retail theft. And on Tuesday, Whole Foods said it was shutting down its flagship store in San Francisco due to soaring thefts.
The Epoch Times has contacted the mayor’s office for comment.
