WalMart To Fire 16,000 As It Closes 269 Stores Globally
The last 12 months have not been kind to WalMart.
When the world's largest retailer bowed to pressure to raise wages for its lowest-paid employees, the living wage crowd cheered. In short order, it became apparent that the reverberations from the $1.5 billion endeavor would spell trouble for the company.
When a series of ill-fated efforts to squeeze the supply chain failed to plug the gap, the company resorted to store closures (or "plumbing" as WalMart calls it), job cuts in Bentonville, and reduced hours.
Finally, in October, WalMart threw in the towel and cut guidance. Its shares plunged.
Now, we learn the retailer is set to close nearly 300 stores, affecting some 16,000 employees worldwide.
- WAL-MART TO CLOSE 269 STORES
- WAL-MART SAYS 10,000 ASSOCIATES AFFECTED IN U.S.
- WAL-MART SEES ABOUT 16,000 ASSOCIATES AFFECTED
- WAL-MART SEES FINAL EFFECT 20C-22C ON EPS CONT OPS
- WAL-MART EXITS WAL-MART EXPRESS PILOT
This time around, "plumbing" was not cited as a factor.
Behold: the effect of an across the board minimum wage hike...
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Full PR
Wal-Mart Stores, Inc. (WMT: NYSE) today announced plans to close 269 stores in the U.S. and globally.
In October 2015, the company said an active review of the portfolio was underway to ensure assets were aligned with strategy. Today’s action follows a thorough review of Walmart’s nearly 11,600 worldwide stores that took into account a number of factors, including financial performance as well as strategic alignment with long-term plans. In total, the impacted stores represent less than 1 percent of both global square footage and revenue.
“Actively managing our portfolio of assets is essential to maintaining a healthy business,” said Doug McMillon, president and CEO, Wal-Mart Stores, Inc. “Closing stores is never an easy decision, but it is necessary to keep the company strong and positioned for the future. It’s important to remember that we’ll open well more than 300 stores around the world next year. So we are committed to growing, but we are being disciplined about it.”
Store Closings/Openings
As part of today’s action, the company will close 154 locations in the U.S., including the company’s 102 smallest format stores, Walmart Express, which had been in pilot since 2011. Walmart instead will focus on strengthening Supercenters, optimizing Neighborhood Markets, growing the e-commerce business and expanding Pickup services for customers. Also covered in the closures are 23 Neighborhood Markets, 12 Supercenters, seven stores in Puerto Rico, six discount centers, and four Sam’s Clubs.
Internationally, the company is following a disciplined strategy of actively managing its portfolio. Consistent with this strategy, the company is closing 115 stores outside the United States. This includes 60 recently-closed, loss-making stores in Brazil, which represents only 5 percent of sales in that market. The company has already been able to relocate many affected associates in Brazil to other stores. The remaining 55 stores are primarily small, loss-making stores in other Latin American markets. Walmart will disclose more detail about those actions, including the number of stores per market, after completing local associate and community outreach.
Walmart will continue to invest in its future, with plans to open stores worldwide in the coming fiscal year. Domestically, Walmart intends to open 50 to 60 Supercenters and 85 to 95 Neighborhood Markets in Fiscal 2017, which begins Feb. 1. In the same period, Sam’s Club plans to open in seven to 10 new locations. Internationally, Walmart intends to open between 200 and 240 stores during the coming year.
Financial Impact
The financial impact of these closures is estimated to be approximately $0.20 to $0.22 of diluted earnings per share from continuing operations, with approximately $0.19 to $0.20 expected to impact the fourth quarter of fiscal 2016. The remainder of the impact will fall into the first half of fiscal 2017. Approximately 75 percent of the impact relates to U.S. closings and the remaining portion involves Walmart International, with a large majority of the international impact relating to the closures in Brazil. Walmart will report its fiscal 2016 fourth-quarter and full-year results on Feb. 18. The estimated financial impact is not included in the company’s fiscal 2016 fourth quarter and full year earnings guidance.
Store Associates and Transition Assistance
In total, approximately 16,000 associates will be impacted by the decision, about 10,000 of them in the U.S. More than 95 percent of the closed stores in the U.S. are within 10 miles on average of another Walmart, and the hope is that these associates will be placed in nearby locations. Where that isn’t possible, the company 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.
“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 are supporting those impacted with extra pay and support, and we will take all appropriate steps to ensure they are treated well.”
Walmart will continue to serve the shopping needs of U.S. customers in the markets affected by today’s announcement through other Walmart locations and online at www.walmart.com. Customers can find the nearest Walmart store through the store locator function on the company’s website. A list of U.S. stores that are closing will be available today on the company’s website at approximately 11 a.m. CST.
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Is anyone suprised? We live in a Philip K Dick reality now.
Is anyone suprised? We live in a Philip K Dick reality now.
I would say banning the rebel flag was the more serious offense.
Welcome to Wal Mart. NOW GET THE HELL OUT !!
Welcome to Wal Mart.
U are soooo fvked.
Yeah, how dare they be the largest private employer on the planet.
I'm glad everything is starting to blow up on OBummers watch. Though I suspect there is still a few Bush strawmen to attack.
Interesting they are closing 7 stores in Puerto Rico. Have you been to Puerto Rico? The stores are already hard to find there, and the island is not that big (few hours to drive across). How many stores do they have there...
Ah just looked it up... 16 stores. So they are closing almost half. I would wager it won't be long until they exit Puerto Rico entirely due to their predatory tax structuring to effect Wal-Mart alone. Good job guys, you already have a dying economy now you are taking away affordable options for people who can barely afford anything to begin with.
Hope & Change.
"Fuck the Waltons...."
SO tired of the company bashing.
Would you have them go out of business and take 2.2 million worldwide jobs with them?
Walmart sells cheap Chinese made products that people want to the tune of $482B in sales. They have a profit margin of 7% which means 93% of all revenue is redistributed in the form of wages, cost of goods sold to vendors, etc... Do you have ANY idea how this money trickles through the economy?
So, if you don't like how a certain company operates, don't shop there. I don't particularly care for Walmart...and it's not because of their business acumen, tactics, ethics, etc.. I just don't like cheap Chinese made products. What they pay their employees if of no concern to me. I don't second guess their processes. If their employees don't like what they're being paid, they're free to apply their skills to another job.
The Waltons should be celebrated for creating and sustaining an amazing American Icon of a business.
I'm with ya, Max - So far, we still have a loose form of the freedom to associate in the U.S.
Don't like Big Retail? Don't shop at Big Retail. Problem solved.
heeeeeeeerrrrrreeeeeeee's da list:
http://news.walmart.com/news-archive/2016/01/15/walmart-continues-sharpe...
Good Night John Boy!
And so it begins, for real this time. This is not, "just a correction".
Oh they fixed the plumbing issues I take it?!
THAT is not good.
Ho LEE PHUk this is 10 dead canaries in the coal mine
How many total stores does Walmart have ?
"It has over 11,000 stores in 28 countries, under a total 65 banners."
so the minimum wage was raised in all the countries?
The fuck REALLY?
Maybe it's the depression, not the wages? But hey, blame it all on the peasants, the fsa, crony capitalists - choose your poison.
sorry, double-post
Obama's economy: where not even effin WalMart can make a go of it selling plastic crap off a conveyor belt from China to people with revolving credit.
I knew they'd have a problem when they removed all those Confedrate flag items and replaced them with Al Sharpton Hasbro action figures ... free purple Escalade included.
I guess those aren't selling as well as the flags.
That's odd.
Walmart are committed to growth and are opening 300 stores NEXT year !! LMAO - There won't be a NEXT year for retail and Walmart KNOW it !
Wheres' the FSA commenters here to bitch about big bad corporations? Or perhaps we can get LTER to grace us with his accounting genius again on their stock buyback program, along with other enlightened ZH commenters who can't read a balance sheet.
Good, now maybe some small businesses can return and fill the spots they destroyed.
You mean the small businesses that went out of business because they couldn't compete? Yeah, the government should have instead proactively subsidized inefficiency instead, we all now what a bang up idea that is.
I know of several towns who kept walmart out of their area and even county. It isnt about subsidy it is about your local government. Local government has the power to keep them out. This is why you go to town hall meetings. Strange how sometimes a republic works.
sometimes.
right down to your municipality your elected reps work for a corporation.
easily verifiable on dun & bradstreet.
everything is captured.
power will continue to consolidate.
Local government has the power to shit on private property rights and subsidize losers - yes, you're correct. That's a republic working, punishing success from envy and their inability to compete. Such a mindless, loser mentality.
Our local government gave away $50 Million to FaceBook in order get a datacenter constructed and create 25 jobs...fools...that building will be abandoned, and the taxpayers on the hook for it, long before we recoup that $50M.
No I mean how Walmart bribed local governments with wads of cash to get sweethart deals to build new stores. Yes you are correct, the small businesses died because they couldn't compete with corruption and graft. Now we return you to our regularly scheduled programming.
Please provide links to the bribery cases. This will make great reading.
in a country where Hillary Clinton is considered presidential material, you still want proof of corruption?
Of course the walmart CEO's are beyound corruption, quasi-saints!
You've got the right, .gov just came back and said "no bribery here in Mexico" . I'm sorry Walmart is as clean as a whistle and is the savior to the US economy.
"...you still want proof of corruption?"
Yes. But I want proof of the bribery that Mr. Universe claims occurred.
Sorry, I'm not part of the group-think (non-think, actually) crowd. I want to see the bribery cases that involved Walmart. It doesn't bother me that I've decided to think for myself.
And no, "you're stooooopid" is not a convincing "argument."
Glad to see "slower" in your name; cause you're definitely a bit slow in the brain.
Bribes are now totally legal, so no one breaks laws buy accepting a modern day bribe…which is not like the old days of an envelope full of cash…in 2016, you “agree” with the Corporations position and you “aid” them in “creating jobs"; and then they invite you to all the best parties…and when you “retire” from Government, they "hire you" or put you on a board somewhere with a fat salary and an expense account...all perfectly legal and ALL HIGHLY incentive for you to "vote" as is expected...
~~~~~~~~~~~~
Look at ObamaCare:
The "Chief Architect" came from Corporate America to "advise" the Government on the ACA's design..and once passed, she went back to Corporate America..Johnson & Johnson.
LOL. I did predict that the "you're stooooopid" posts would come along and... then one appears.
Considering inefficiency is the one thing fedgov excels at...
Standard Disclaimer: And winning the participation award for the 20th straight time...
Blacksmiths and sword makers? When no one can afford cheap chinese plastic, how in the hell can a broke small businessman have any chance and what are the tapped out consumer going to want?
Food, shelter, clothing and yes, guns and ammo...
hmmm and Walmart don't sell these things? Or are you saying that is all Walmart should sell?
Tapped out consumers will want horse and buggy, some goats and chickens, a few cows and pigs and some ink and paper, a saddle and a knife and some string and fish hooks and beaver pelts.
Don't forget machete, axes, shovels, rakes, straight shooters...
..and a pair of scissors and desk to crawl under in case of an emergency or riot.
Food, shelter, clothing and yes, guns and ammo...
blacksmiths and sword makers sounds pretty damn cool right now...
Good luck getting a loan from TBTF bank or even a local bank. They are not giving loans to Mom & Pop and Mom and Pop have been stripped of all their assets trying to stay in the not so middle class. Welcome to the Obamanation.
I learned the hard way how to give my banker a good solid laugh when I walked in and asked for a small business laon. He leaned over the desk and informed me, 'if you're not a diverse person or a vet, forget it!"
There's many reasons to vote for Trump; that's one of them.
The infernal shitcan of your Presidency will be yours to hold soon
This should be great opportunity for them to execute a stock buy-back.