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Walmart to close 269 stores around globe, massive lay-offs

Closing Walmart stores

The closures will begin at the ending of this month and do not entirely come as a surprise. Back in October the company’s CEO, Doug McMillon, had told investors that they were looking at their portfolio with a view to becoming more streamlined and competitive.

“No doubt our business has become both large and broad,” CEO McMillon told investors three months ago. “It is more important now than ever that we evaluate our portfolio.”

With competition from Amazon.com and other online companies, Walmarat, also sometimes written as ‘Wal-Mart’ is making efforts to increase its Internet sales presence. Diverting attention and resources to doing so will temporarily affect its profit margin and Wal-Mart said earnings may be down 12 percent next year.

Walmart opened smaller-format stores in the U.S. in 2011, called Wal-Mart Express, that were convenience stores. That experiment is deemed a failure and 102 of the store closures will be Walmart-Express stores. Overall, the store closures in the U.S., Brazil and other countries (no closures in Canada) represent but 1 percent of Walmart’s global revenue and square footage.

Store associates

To the 16,000 workers — Walmart calls them associates — affected by closures, Walmart will “provide 60 days of pay and, if eligible, severance, as well as resume and interview skills training. Whether with Walmart or elsewhere, the company’s objective is to help all associates find their next job opportunity.”

In the next fiscal year, which begins Feb. 1, the company plans to open as many as 300 new stores worldwide, focusing on Supercenters and Neighbourhood Market stores.

“The decision to close stores is difficult and we care about the associates who will be impacted,” McMillon said. “We invested considerable time assessing our stores and clubs and don’t take this lightly…we will take all appropriate steps to ensure they (affected workers) are treated well.”

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