Monday, 10 July 2017

What Happens When Walmart Decides To Close A Store?

At the beginning of 2016, Walmart did something unusual. The mega-retailer closed 269 stores, 154 of which were in the United States. While Walmart also opened hundreds of stores around the world last year, keeping its net store count the same, its pullout was devastating for rural communities where smaller retailers had closed their doors when Walmart came to town.

Walmarts rarely just close

When Walmart closes a store, it’s more likely to open a larger one next door or a few miles down the road than to leave town entirely. If you live in an area that hasn’t spent decades fighting off Walmart and its fellow big boxes, you can probably think of a handful of examples off the top of your head.

Just having a store move down the road can have devastating consequences for local governments and the chain’s strip mall neighbors. In an article published on Medium, Christopher Peak detailed the struggles of the former neighbors of Walmart in Seabrook, NH, when the store moved down the road, breaking a lease that kept the store from selling groceries.

Its neighbors were locked into long-term leases and couldn’t afford to move. Even an optometrist in the same plaza suffered: While the Walmart had a vision department, the locally owned shop benefited from foot traffic and customers who couldn’t be fitted at Walmart.

Move, or just threaten to move

Like other big-box stores, Walmart often uses the threat of closing stores to negotiate better property tax rates. These are called “dark stores,” where retailers use the threat of leaving town to lower property tax rates to what they would be if the store were vacant. After all, if the store moved to a new location just over the town or county line, it would be vacant.

Making things worse in rural West Virginia

The Guardian US looked at the fallout of Walmart’s departure in just one of those communities, McDowell County, WV. The county was home to a Supercenter in Kimball that closed on Jan. 28, 2016, and the community is still struggling a year and a half later.

The area peaked at 100,000 residents during its heyday as a coal mining town, and was proud to be the home of a Walmart when the chain put a Supercenter there in 2006.

“People welcomed it with open arms,” one resident told the Guardian.

Affordable fresh food

Yet one thing that the county lost when Walmart left was access to inexpensive fresh food. The county already has the lowest life expectancy [PDF] out of all counties in the United States, the Guardian points out. Yes, residents could grow their own vegetables, and many do, but one resident described long drives to stores where the ingredients for something as simple as a salad are available year-round.

When the Guardian asked a Walmart spokeswoman why the chain decided to leave its Kimball store and its customers behind, she said that reasons for the closure included “financial performance as well as strategic alignment with long-term plans,” and keeping Walmart profitable and growing.

“We look forward to continuing to serve our Kimball area customers when they visit our stores in Bluefield, Princeton, and MacArthur,” she wrote. Both of those stores are an hour’s drive away.

Some employees of the Kimball Supercenter accepted transfers to those stores and make the commute daily, while others moved to take jobs at more distant stores. Restaurants and the housing market around the store
are now suffering.

“It was a great social network”

One man even explained how the store served as a town square and place to socialize. “If you were lonely and had nothing to do, you’d go to Walmart to talk to folk,” he explained. “It was a great social network.”

Even the area’s food bank used to receive tons of “waste” fresh food from Walmart, and now has to do without those baked goods and vegetables.

Losing a Walmart meant losing a social center, a source of jobs, and a surrogate family for the store’s employees.

“We were all crying. It was a sad day for a lot of people,” one employee who helped set up the store at the beginning and stayed there for all ten years told the Guardian. “It was a sad day for me – I spent more of those 10 years at Walmart than I did at my own home.”


by Laura Northrup via Consumerist

No comments:

Post a Comment