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The retail superstore closed over 20 stores in 2023 and continues to shutter more in 2024.
Author:
Jena Warburton
Now that we're three months into the new year, we're starting to get a firmer idea of what retailers are having an easier time and saw success during the busy Q4 holiday shopping timeframe, and which are struggling.
Macy's (M) , for example, announced it would close 150 more stores among declining sales and foot traffic. Kohl's (KSS) has turned to inviting other stores into its own brick and mortar locations in an effort to gin up excitement about the brand. And budget-friendly retailers Dollar Tree and Family Dollar (DLTR) announced they would shutter approximately 1,000 locations in 2024 among declining economic conditions.
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It's understandable why so many retailers are having a tough time right now. Inventory shrink, or the industry term for theft, has reached record highs across the country. Some stores have been forced to put high interest and high value items behind lock and key to prevent theft.
And stubbornly high prices everywhere, from food to apparel to energy, forced many customers to cut back on both discretionary and sometimes necessary spending, opting instead for cheaper retailers or pinching pennies at home and cutting down on certain higher priced items, like meat and eggs.
The most recent Consumer Price Index (CPI), released on Tuesday, was up 0.4% for the month of February and 3.2% compared to the same period one year ago.
Here's a look at some key items that changed in price during the month of February:
- Food: 0%
- Energy: 2.3%
- Gasoline: 3.8%
- Fuel oil: 1.1%
- New vehicles: -0.1%
- Used vehicles: 0.5%
- Apparel: 0.6%
- Shelter: 0.4%
- Transportation services: 1.4%
- Medical care services: -0.1%
Walmart closing more stores in 2024
Since things are more expensive for just about everyone, it's no surprise that even budget-friendly retailers like Walmart (WMT) are seeing an impact.
The retail giant closed approximately 24 stores in 2023 due to a mix of factors, including lower-than-expected performance, inventory shrink, and economic downturn.
"These stores lose tens of millions of dollars a year, and their annual losses nearly doubled in just the last five years," Walmart said in a press release, adding, "We have invested hundreds of millions of dollars in the city [of Chicago]... 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."
And in 2024, the retailer already announced the closure of two California stores in January alone, including:
- Walmart Neighborhood Market on Imperial Avenue, San Diego
- Walmart at Fletcher Parkway, El Cajon
Now, it's saying it will shutter two more locations, bringing the total store closure tally in 2024 to six.
Those stores are in the Baltimore area of Maryland and California. So far, the total tally is:
- 2121 Imperial Ave. in San Diego CA)
- 605 Fletcher Parkway in El Cajon (CA)
- 2753 E. Eastland Center Dr in West Covina (CA)
- 4080 Douglas Blvd in Granite Bay (CA)
- 1238 Putty Hill Ave in Towson (MD)
- 3579 S. High St. in Columbus (OH)
Walmart cited poor performance as the reason for the two most recent closures, though it did not go into further detail.
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