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Wal-Mart pulls plug on smallest stores, shuts 269 locations

(Agencies) Updated: 2016-01-18 14:00

Wal-Mart pulls plug on smallest stores, shuts 269 locations

Shoppers look at towels while walking through a Walmart store in Secaucus, New Jersey, Nov 11, 2015. [Photo/Agencies]

Wal-Mart Stores Inc has said that it would pull the plug on its smallest store format, Walmart Express, and close 269 locations as it contends with higher costs in its home market of the United States and disappointing results overseas.


The world's largest retailer said it hoped to transfer many of the 10,000 US and 6,000 Latin American workers in the closed stores to other locations.

Wal-Mart's earnings have been under pressure due to last year's decision to raise entry-level wages as well as higher investments aimed at closing the gap online with Inc. At the same time, Wal-Mart is struggling overseas, where a strong US dollar reduces the value of local sales.

The closings come three months after Chief Executive Officer Doug McMillon disclosed plans to review global operations and shut underperforming stores. Friday's announcement marks the first step in that restructuring effort.



Moody's retail analyst Charlie O'Shea described the closures as a long-overdue "pruning."

"I've always wondered why it's taken so long to cull the US store base because they really haven't done much of it over the past several years," O'Shea said.


The company's shares fell 2.6 percent to $61.39.

The other 52 US stores to be closed are a mixture of Supercenters, Wal-Mart's largest format; discount stores; Neighborhood Market groceries; and outlets in the company's Sam's Club bulk-selling wholesale chain.

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