Discount retail giant Walmart is only the half the giant it once was in Chicago, saying this week that it will shutter four of its eight locations there. The Washington Post says the move signals “urban struggles.”
Outgoing mayor Lori Lightfoot, who has overseen a massive spike in murder and other crimes, said in a statement, “Unceremoniously abandoning these neighborhoods will create barriers to basic needs for thousands of residents.”
According to Walmart’s official statement, their eight locations “lose tens of millions of dollars a year.” The company has apparently never made a profit at its Chicago locations. “The remaining four Chicago stores continue to face the same business difficulties,” the statement reads, “but we think this decision gives us the best chance to help keep them open and serving the community.”
Translation: If closing half our stores doesn’t quickly drive traffic to the survivors, we’ll have to shutter them, too.
Honestly though, I’m more interested in WaPo reporter Jaclyn Peiser’s skewed take than I am in any problems Walmart has in one of the nation’s most violent cities.
Peiser compared Walmart’s troubles to Home Depot’s, noting “that shoppers are feeling the strain of inflation and continuing to cut discretionary spending from their budgets” and that “Both companies are seen as bellwethers for consumer behavior.”
OK, fair enough — but after that, Peiser’s story goes off the rails, mentioning that “Whole Foods closed its flagship store in downtown San Francisco” on Monday. We don’t know if Whole Foods was losing money at its massive (and pricey) Market Street location. Most retail stores don’t start making money until they’ve been in business for at least a year, and that Whole Foods flagship store had barely been open for a single year.
The store was closed, as the company noted in its announcement, in order “to ensure the safety of our Team Members.” The Market Street location was across from the city’s United Nations Plaza, which the city has allowed to morph into a skeevy homeless camp and open-air fentanyl bazaar.
But perhaps the comparison is more apt than Peiser intended.
She quoted Neil Saunders, an analyst at GlobalData, who tried to explain away Walmart’s problem in urban areas.
“Where Walmart works best is really in the suburbs,” Saunders said. “It’s where they can have a massive store, they can have massive parking lots, people can drive up to the store, they can load up the car.” Except that three of the four locations being shuttered are “Neighborhood Market” stores that are much smaller and sell mostly groceries.
Target, Saunders explained, is “much more successful in urban areas because Target is much more of an inspiration-type shop, especially in urban areas.” While that’s true, Saunders left out one very important detail: Target is closing urban locations, too.
Beginning next month, Target will close stores in Minneapolis, Philadelphia, and metro Washington, D.C. Previously, Target had to temporarily close 175 locations nationwide due to mostly peaceful George Floyd riots.
Other, more urban-friendly chains like CVS and Walgreens have closed multiple locations since 2020 — particularly in San Francisco — due to organized shoplifting rings and local district attorneys who have stopped prosecuting so-called “lifestyle crimes.”
After 17 years of losing money and a looming recession — actually, we’ve been in one already — you can’t blame Walmart for pulling the plug on half its Chicago stores. It isn’t even remotely surprising that they hinted rather broadly that the surviving four might soon find their way to the chopping block.
But Chicago’s (and San Francisco’s and Minneapolis’s and… etc.) “urban struggles” aren’t due to the same macroeconomic troubles faced by folks from the suburbs to the exurbs to our farming communities. These are self-inflicted wounds caused by bad governance enabled by kamikaze-minded voters.
Recommended: ‘Dementia Joe’ Needs Hunter to Help Him Answer a Question from… a Child?
Join the conversation as a VIP Member