(Bloomberg)—Wal-Mart Stores Inc. plans to close hundreds of stores, including its experimental small-format Express outlets, as it refocuses on its e-commerce site and better-performing locations. The move will eliminate 16,000 jobs.
The move affects 154 locations in the U.S., the Bentonville, Arkansas-based company said in a statement Friday. Overseas, the streamlining effort includes the closing of 60 money-losing stores in Brazil, a country where Wal-Mart has struggled.
CEO Doug McMillon took the step after reviewing the chain’s 11,600 stores, evaluating their financial performance and fit with its broader strategy. The move also marks the end of its pilot Wal-Mart Express program, a bid to create a network of small corner stores that began in 2011. Wal-Mart, No. 3 in the Internet Retailer 2015 Top 500 Guide, will continue its larger-size Neighborhood Markets effort, though 23 poor-performing stores in that chain also will be closed.
“We invested considerable time assessing our stores and clubs and don’t take this lightly. We are supporting those impacted with extra pay and support, and we will take all appropriate steps to ensure they are treated well.”
Wal-Mart’s decision underscores the changing retail landscape, says Neil Saunders, CEO of research and consulting firm Conlumino.
“The blunt truth is that while stores remain a vital part of the retail mix, they are not quite as relevant as they used to be,” Saunders says. “In some areas of the U.S. there was a time when a local Wal-Mart would be the go-to destination for certain products, mainly because of an absence of alternatives. The growth of online, and especially of Amazon, has undermined that advantage and has given almost all consumers easy access to a comprehensive and relatively cheap assortment of products.”
Amazon.com Inc. is No. 1 in the Top 500.Favorite