Retailers tend to close stores because they are not profitable

NY Times:

Walmart Raised Wages. Then It Closed 63 Stores.

The company cited the new tax law in unveiling better pay and benefits, but within hours it had undercut that triumphant message with another announcement.
Stores can be unprofitable for several reasons. Consumers can reject the marketing concept of the retailer, or the location does not capture enough of the right kind of traffic.

The bulk of the closures are not Walmart stores, but Sam's Club which I saw as a concept meant to compete with stores like Costco. I think the problem with Sam's is they package their products for bulk sales. I once bought coffee stirrers in Sam's Club and it took me 20 years to eventually use all of them. That was one of the reasons I prefer to shop at Walmart and get things in reasonable quantities. I suppose a large family or restaurants can use the bulk item but I can't.

The tax law was not meant to cure the marketing headwinds of a concept that is not working. The tax cuts plus the reduction in an unprofitable venture appears to have made it possible for Walmart to improve the salaries and benefits for employees at more profitable locations. That is just good business judgment, which appears to be a concept that evades many liberals.


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