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."
Walmart claimed that there was no action city leaders could take to help the solve the issue.
"Community and city leaders have been open and supportive as we met with them over the years to share these challenges. As we looked for solutions, it became even more clear that for these stores, there was nothing leaders could do to help get us to the point where they would be profitable," Walmart said.
The four locations to be shut down "will close to the public by Sunday, April 16," Walmart reported. "The pharmacies at these locations will remain open to serve patients for up to 30 days."
The company is offering employees the opportunity to transfer to another store.
"All associates will be paid until Aug. 11, 2023, unless they transfer to another location during that time," the company noted. "After Aug. 11, if they do not transfer, eligible associates will receive severance benefits."
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