They are saying the stores are not financially successful. Why not? Are there too many stores, are they in dangerous areas? And where are people without a lot of money shopping there, if not Walmart?
3 of the 4 closing are not regular Wal-mart’s, they’re “Neighborhood Markets”. Basically grocery stores. So the answer to where people are shopping is “other grocery stores.”
People who would have shopped at these Walmarts will probably switch to Dollar Stores, which are pervavise in low and moderate income neighborhoods.
Walmart said the closings are due to a lack of profits, theft and security issues.
So apparently dangerous for Walmart.
Yes, there are a lot of Dollar Generals and Family Dollar stores here. They sell basic groceries, some basic clothes, and I heard they might experiment with selling fresh produce.
I notice one of the stores on North Broadway doesn’t have free parking (and being Chicago, there’s not even on-street free parking), and while it’s on a bus line, it’s blocks away from the nearest El. In addition, there’s a Mariano’s a short walk north, which not only has better meat and produce, but isn’t that much more expensive than WM on the basics. And has free parking.
It’s not just Chicago or Wal-Mart:
Stranger
I honestly had no idea they had Wal-Marts here in Chicago proper – and I live just south of Little Village, where one of the closing Wal-Marts is. (Looks like it’s a Neighborhood store, as is the one in Kenwood, which I must have passed more than once and just not noticed.) All the ones I’ve ever been to were just outside the city.
Even if they are not in dangerous areas, the neighborhood markets are about 1/5 the size of a Walmart supercenter and in an urban area. And the size, urban vs suburban and car vs public transportation are going to make a difference in what people buy and how profitable the store is. I’m not sure what the most profitable department at Walmart is - but I know it’s not groceries and I suspect it might be the pharmacy. But maybe a neighborhood market doesn’t get as much pharmacy business as a supercenter for whatever reason. Or maybe it’s gardening and outdoor furniture that is most profitable.
Just out of curiosity I checked the Aldi locations in Chicago and there are 18 of them located south of the Stevenson Expressway. Obviously it’s possible to make money in lower socioeconomic urban neighborhoods. I suspect WalMart just hasn’t learned how yet.
As someone who used to live very near there, this is true. The Mariano’s replaced a Dominick’s supermarket, the actual building had burned down in some electrical fire and it was a bit of a grocery desert for a bit.
The Walmart near there is stuck in an impossible situation. For some crazy reason, there was a decision made to try to shoehorn big box stores in the north side of Chicago from around Belmont to Diversey from Broadway to Clark.
Whereas if they’d drawn the circle around approximately Sheffield and Clark they could have had all those stores anchor a transit hub.
The #1 question when planning urban retail should be, "how far is someone willing to walk carrying shopping bags? With Chicago, you can add Question #2: In the winter?
It was newsworthy at the time (2006) but I wouldn’t have been able to identify any stores in the city, either.
From what I’ve seen, not even to the back of a small parking lot. And that’s with a grocery store cart.
I didn’t have a car for the first 20 years I lived in Chicago. That would have been approx. 1987 - 2007. I managed just fine and never lived particularly close to a grocery store. The bus or the train were always close enough to be useful.
If I needed a couple of things there was always a bodega/corner store close to me.
I find the protests curious, as though community residents have some right to force a private corporation to keep open unprofitable businesses. Seems like if the community wanted the store to stay open, then the object of their protest ought to be fellow residents who did not shop there (I’ve also seen allegation software theft and other crime - tho I’m not sure how warranted those were.)
It seems like Walmart has never been “comfortable” in urban environments. Their suburban development pattern is so normative that they lose one of their efficiencies when pounding their round peg into the square hole of a multi-story multi-tenant building, or into a smaller-format store than their logistics system is optimized for. Those urban rents require higher sales targets than their disposable buildings out in the burbs. The first Walmart didn’t open within the city limits of Chicago until 2006, as @jnglmassiv said. Union labor requirements, city minimum wage laws, and a relative disdain for Walmart (and some other pillars of suburbia like Applebee’s, Olive Garden, your typical “mall” stores) is a factor too. Even when they are in cities, they seem to be at the periphery where land is cheaper and they can implement their suburban development typology, or in some large brownfield redevelopment where the land is cheap. When your margins are low single-digits, any one of these factors being slightly off-kilter can kill profitability.
Part of the argument is that when the Walmart (or whatever) opened, it killed off businesses that served that neighborhood. Now there’s going to be nothing left, so Walmart etc. are looked at as something like a monopoly whose taken on a burden of responsibility, which changes the rules somewhat, at least perceptually. After all, back when corporations were invented as a concept, they had to prove they had some sort of public benefit. Enriching shareholders wasn’t enough, but that ship as long since sailed away.
There aren’t any Walmarts in NYC as far as I know, but there are some Targets and other big box stores. They are mostly in areas that are not typically urban and they can implement at least some of their suburban style development but they don’t often change that style even a little to accommodate an urban environment. For example, parking is either in front of the building or surrounds the building so that someone on foot must walk through the parking lot to get the the store rather than putting the store closest to the street and the bus and putting the parking behind it. Or there are two separate stores next to each other, and the way things are arranged you have to leave Big Box store #1 , walk through the parking lot to the sidewalk , walk over to store #2 and then walk through the parking lot to the store. Which I’m guessing causes a lot of people to shop elsewhere - I know I avoid that sort of setup when I am on foot.
Meanwhile, Chicago has 22/23 Targets in the city proper (from my count on their website – their Bedford Park location is listed as Chicago, but I think it’s properly Bedford Park.) Plus a slew in the burbs. Chicago seems to be the city with the most Targets.
I quickly looked at New York City, and it lists 12 locations in Harlem, Tribeca, East Village, Hells Kitchen, Times Square, and a few others. Why both are cities are fine with Targets and not Walmarts – I’m not exactly sure. Walmarts do tend to be a bit bigger, but there’s still space around the city to put full-sized stores. Chicago doesn’t need quite the amount of vertical room NYC does. Things are definitely not quite as cramped here.
Many of the Chicago Targets are actually two-stories to save space. Looks like the NYC ones are the same. I’ve never seen a two-story Wal-Mart. Not sure if they’ve tried.