Last year was not a good year for Walmart, and it now looks like 2016 might not be much better, as the retail giant is planning to close 269 stores. These locations include the company’s experimental small-store Express outlets and many locations in Brazil. In total, more than 16,000 jobs are expected to be eliminated.
In the United States, where Walmart is the nation’s single largest private employer, the company is planning to close 154 stores. Internationally, Walmart will close 60 stores in Brazil that were losing money. Overall, the closing of the stores will affect less than 1% of the company’s total square footage and revenue.
The decision was made by Walmart CEO Doug McMillon after he took the time to review the performance of the chain’s 11,600 stores. The move will put an end to the Walmart Express program, which consisted of an effort to create smaller corner stores starting in 2011. While the Walmart Express program will end, the company’s Neighborhood Market series will continue. However, a total of 23 of these medium-sized Neighborhood Market stores will be shut down.
McMillon stated, “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.”
A total of 12 of the company’s massive Walmart Supercenter stores will be shutdown. These stores employ about 600 people on average. The majority of these closings will occur before the end of January. Last year, Walmart closed three of its Supercenter locations.
Following the news, shares for Walmart fell by more than 2%. Over the past year, Walmart shares have lost nearly 30% of their value, largely because of slow growth and declining profits.
With the closures, more than 10,000 Walmart employees in the United States will be affected. The company will offer the employees the opportunity to relocate to other stores within their respective regions. The company will also provide the affected workers with 60 days of pay and one week of severance for each year that they spent with the company. Walmart currently has about 1.4 million American employees and 800,000 employees outside the United States.