For a few months now, supermarkets in the United States have not had a good time and have had to face difficult scenarios. The pandemic was a critical point for this business model, since although during this coronavirus crisis millions began to increase their consumption of products and services, the reality is that in certain cases consumption was reduced and in turn, the profits of supermarkets.
Rising transportation, production and storage costs have been some of the problems that this business model has had to face. These costs have increased significantly due to the increase in energy prices and fuel prices worldwide.
Likewise, a much more competitive terrain has hit the finances of these businesses, as hard discount alternatives have conquered the market and banished several brands.
Walmart Closes 12 stores
The famous and huge supermarket chain Walmart, which anticipated a policy of store closures several months ago, has now announced that by 2024 the company will close a total of 12 stores in seven states of the country.It is important to note that Walmart has 4,600 branches throughout the United States, making it one of the largest chains in the country.
One of the reasons that may be driving the closure of stores is due to the fact that there is a lower profitability of the aforementioned locations, in addition to thefts that have occurred in several locations and the transition from in-person sales to online exchanges, which makes the operation of some branches unsustainable. Currently, it is estimated that Walmart serves around 225 million customers a week, in its more than 10,500 branches and websites.
According to the Gestión portal, these are the venues that will close this year:
- San Diego, California, at 2121 Imperial Avenue
- El Cajon, California, at 605 Fletcher Parkway
- Columbus, Ohio, at 3579 S. High Street
- West Covina, California, at 2753 E. Eastland Center Dr
- Granite Bay, California, at 4080 Douglas Blvd.
- Dunwoody, Georgia, at 4725 Ashford Dunwoody Road
- Marietta, Georgia, at 3101 Roswell Road
- Norwalk, Connecticut, at 680 Connecticut Ave.
- Fremont, California, at 40580 Albrae Street
- Aurora, Colorado, at 10400 E Colfax Avenue
- Milwaukee, Wisconsin, at 7025 W. Main Street
- Towson, Maryland, at 1238 Putty Hill Avenue
- US outlet also announced bankruptcy and impact on its customers
Similarly, in 2023, Walmart closed 24 stores and in 2022 it also carried out the same action at several locations. Best Life indicated that it could be part of a marketing strategy, in order to boost other stores and continue growing.
Some analysts say the closures may be part of a broader marketing strategy. The idea would be to reinforce the stores that remain open, focusing on those that generate the most profits. This strategy could also benefit Walmart by reducing operating costs and improving its profitability.
In recent years, Walmart has struggled in some urban areas, where operating costs are higher and sales do not justify keeping stores open. It has also closed stores in rural areas, where low population and sales volume are not sufficient to sustain operations.
The COVID-19 pandemic exacerbated many of these closures as many retailers faced additional challenges related to changes in demand, supply, and the need to modify their operations to comply with new public health regulations.
While Walmart remains one of the largest and most successful retailers in the world, the store closures demonstrate its focus on restructuring to focus on more profitable locations, expanding its e-commerce and optimizing its supply chain.
