Retail watchers reveal ‘the real reason’ Walmart is closing stores amid retail bloodbath
Retail experts have revealed the real reasons Walmart is closing stores in a major city amid the unforgiving ‘retail apocalypse’.
As reports of theft have skyrocketed in recent months, industry analysts actually suspect that other issues led the department store to close its Portland stores.
Walmart has already issued warnings about their ongoing shoplifting problem, and their CEO Doug McMillon has admitted it could lead to price hikes.
Some political figures have taken the opportunity to attribute the closures of Walmart in Portland to the problem of theft.
“That’s what happens when cities refuse to enforce the rule of law. It allows the mob to take over. Businesses can’t operate in that environment and people can’t live there,” wrote Texas Governor Greg Abbott in a tweet last weekend.
Still, experts suggest the big box store has faced other financial tribulations that have nothing to do with crime.
“The decision to close a store is usually tied to sales,” Neil Saunders, general manager of the retail division at GlobalData told OregonLive.
He added that sales trends “often have nothing to do with theft or shoplifting.”
According to Saunders, Walmart may have struggled in Portland due to competition with other grocery chains such as Fred Meyer, which also sells general merchandise and groceries.
“Walmart generally needs to be where it can be a big player and capture all the action,” he said. “There are places where they struggled to get a firm foothold, and they left those places.”
Kevin Coupe, author of the food industry newsletter Morning News Beat, offered a few other factors that could have hindered business in the Portland area.
He explained that Portland no longer has the appeal of being the fast-growing city it once was.
“It’s a difficult economic environment for everyone. But also, Portland has become inhospitable to many businesses. It’s a city that desperately needs to be reinvented,” he said.
Coupe added that business taxes and strict city regulations can make it even harder for retailers who are already struggling to turn a profit.
Responding to Governor Abbot’s stab at the problem of theft in Portland, the city’s mayor, Ted Wheeler, explained that the problem was more related to the evolution of the retail sector.
In his response, Mayor Wheeler also pointed to “dozens of Walmart stores that have closed in Texas in recent years.”
Robbery or not, unfortunately nationwide store closures have become a stark reality.
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