Walmart to close its final two locations in Portland | Hacker News Reader

Walmart to close its final two locations in Portland

news.yahoo.com

49 pointsElement_42 comments

This headline (note it was originally published by the conservative rag National Review) is misleading. The executive quote from Walmart alluded to theft as a contributing factor, but the actual cause was underwhelming financial performance. I’ve been to one of those Walmarts. It was a dump, even before the pandemic. I also can’t think of many people in Portland that shop at Walmart— many better options.

An earlier publishing of the Walmart Company Statement was made by KPTV and referenced by the later National Review article (echo'd in full by the linked Yahoo! copy pasta).

KPTV made no mention of theft, National Review "linked" that to Walmart closures via a throw to a contextless statment made by Walmart CEO Doug McMillion in December 2022.

The official specific statement (as quoted by KPTV) was:

    Walmart says they are closing the stores because they were not meeting financial expectations.

    “The decision to close these stores was made after a careful review of their overall performance. We consider many factors, including current and projected financial performance, location, population, customer needs, and the proximity of other nearby stores when making these difficult decisions."

https://www.kptv.com/2023/02/23/2-portland-walmart-stores-cl...

https://www.nationalreview.com/news/walmart-set-to-close-all...

Thank you for that additional info. Indeed-- there was not even a mention of theft in relation to these particular closings in the announcement. National Review disingenuously connected this announcement with other comments related to theft.

Context:

“It is at a crisis level,” explained Jeremy Girard of the Oregon Retail Crime Association. Girard estimates some of the hardest hit stores in the Portland-area are losing between $1 million to $5 million annually to theft. Retailers across the city have been forced to hire private security guards, lock down valuable items, change store layout, reduce hours or simply close their doors.

https://www.kgw.com/article/news/investigations/shoplifters-...

I wonder how those numbers compare to the wage “shortages” those stores collect from e.g. requiring employees to do some work off the clock.

Regarding the theft issue at Walmarts in Oregon. A few years ago, the Walmarts in my area switched from 24-hour to 6-11. I asked a security guard at one and he said it was because of the tweakers who would throng through the store at night doing massive shoplifting. He said Oregon law prohibits private guards from checking people's personal bags as they exit the store. A group of employees standing around as we had this conversation said they were all relieved they didn't have to deal with the night crowd any more.

The Walmart in my area also switched from 24 hours to 6-11, I doubt theft was the primary factor. The store was always practically empty when I would go there overnight.

I suspect COVID made it clear staying open those hours didn't increase their profit, as several other local stores open late made similar changes.

This was a year or two before COVID. I think the reason why supermarkets stay open through the night is that they use the night hours for restocking shelves and figure they might as well be open for business. For the big stores like Winco, I think they all went back to 24-hour when allowed to by the state government. During COVID, they didn't switch to shorter hours by choice.

In my area of CT the walmarts will use cashiers assigned to door duty to prompt customers for bag checks.

It’s got to be scary for them and frankly it seems like poor use of a person. They can affect no change at that point in the transaction.

> In a similar vein, Nike and Cracker Barrel locations closed in 2022 with companies citing similar reasons.

… Cracker Barrel?

Apparently they also cited crime problems with the neighborhood when they closed: https://www.kgw.com/article/news/local/jantzen-beach-cracker...

If Cracker Barrel is surprising because it is nominally a restaurant, the ones I’ve been in have an extremely densely packed retail store with a sizable fraction of the floor space of the dining area.

This is kinda awesome

Hopefully local businesses weren't shouldered out by Walmart. Good news for local stores.

Wouldn't that be bad if they were closed due to crime? The local stores would be robbed too?

How many stories are there about retail theft vs. employer wage theft?

Good point. I wonder about self-checkouts instead of cashiers, also.

Sounds a lot like using a "downturn" do layoffs, while really just to reducing expenses under pr cover. Does anyone believe anything that any giant corporation says any more?

Good riddance

Portland's government divested from Walmart in 2014, a year after the closing Delta Park location opened: https://www.newyorker.com/business/currency/the-walmart-free...

Gresham, a city part of the east metro area, repeatedly repelled Walmart Supercenters and proposed regulating or even banning big-box stores in 2010 because of the push: https://www.oregonlive.com/gresham/2010/11/greshams_new_reta...

So did Oregon City, after a 12-year opposition: https://www.oregonlive.com/oregon-city/2014/03/wal-mart_bail...

Hillsboro rejected a 210k-sqft Supercenter in 2003; a smaller 48k-sqft store didn't open there until in 2016, the same time Walmart closed stores in Lake Oswego and SW Portland: https://www.oregonlive.com/washingtoncounty/2016/01/hillsbor...

The Hillsboro, Lake Oswego, and SW Portland stores were all 40-60k-sqft Neighborhood Markets, a different format pioneered for big-box resistance and deployed in Portland throughout the 2010s. The first of those anywhere on the West Coast opened in 2012 in the west metro suburb of Beaverton. (Gresham, which blocked a Supercenter, eventually approved two.): https://www.oregonlive.com/beaverton/2012/02/wal-mart_to_ope...

The 25-year-old Eastport Supercenter is 4 blocks from a 50k-sqft employee-owned WinCo chain bargain supermarket, which opened in 2016 and isn't closing: https://www.oregonlive.com/window-shop/2016/05/winco_opens_s...

It's also 8 blocks from the Fubonn food market mall, and 10 from a Shun Fat chain supermarket, all on SE 82nd. The Shun Fat took over the site of a former Kroger-owned Fred Meyer store on SE 82nd and Foster that closed in 2017, after both the Walmart and WinCo opened.

Chains have blamed closures on shoplifting for 20 years, going back to the pre-Kroger-buyout Fred Meyer closing one in Rockwood, a reputation that set back development efforts in the neighborhood for more than a decade: https://www.oregonlive.com/gresham/2012/09/rockwood_woman_de...

Bonus: A Multnomah County jury issued a $4.4M racial profiling judgment against Walmart in 2022 for an video-recorded incident in the suburban Wood Village Supercenter that allegedly involved loss prevention: https://www.oregonlive.com/business/2022/08/shopping-while-b...

Walmart reports US$3B of shrinkage annually on 10,586 stores, or $283,393 per store: https://www.businessinsider.com/walmart-ceo-stores-will-clos...

So the $4.4M judgment plus legal fees would be about 8 years' worth of inventory losses for both stores combined.

I...have no sympathy.

No sympathy for whom? This is going to negatively impact the purchasing power of a lot of low/middle class shoppers.

Unlikely. Winco is by far the cheapest grocery store chain in the area, and no Walmart is far from a Winco. In other areas, this would absolutely be true but in Portland the impact is likely to negligible if at all. I’d honestly assume, like the others have said poor performance is the reason for closing not theft.

Most populated areas have cheaper grocery stores than Walmart. Walmart is usually only the cheapest option in rural communities.

They still have Walmart.com

You obviously can't ship regular groceries through traditional carriers, and grocery delivery relies on local stores being able to fulfill.

Even if they kept the stores open as a form of a delivery and pickup hub, it's still disadvantages low income individuals or families that do not use technology heavily enough to be able to use the app, or the delivery fees/tip structure could make the cost prohibitive for low income folks.

Well shit. Wal-mart oughtta open up their stores again and quit letting thieves take all the dang groceries this time, if you ask me.

Agreed. Boo frigging hoo.

Wal-Mart didn't design itself to fit into major cities or local economies but to change them in a way that serves their purposes.

I wish they would give numbers. What is the current amount of shrinkage in dollars and how does that compare vs historical. After Walgreens[0] confessed to over-stating the problem, I would like to see more data. Especially since Target has also seen large spending declines as it has been dealing with excess inventory and consumer spending changes (necessities vs luxuries).

[0]: https://www.cnbc.com/2023/01/05/walgreens-may-have-overstate...

For sure they are lumping in a bunch of closings together that are not necessarily related. The original link mentioned other closings Walmart announced in February and most of those are due to Walmart giving up on a specific format that they were testing. But, by lumping in some of these types of closings they can blame "criminals" for their own financial failing

You don’t need a multinational company to tell you shoplifting is rampant in Portland. You can just visit there.

Actually, you do? Anecdotes are insufficient to understand the real magnitude of issues. Is the rate of shrinkage at a Walmart in Portland different from a similarly sized/neighborhood in Austin? How does it compare vs historical trends? Is Target showing similar? Are these numbers more or less than following the 2008 crash?

I wouldn’t take anyone’s word for it.

There are too many actors with an agenda and a free political PR machine spewing hate about SF, Portland, Seattle, NYC, etc.

Even Walgreens publicly admitted in Jan that they had made far too big a deal about shoplifting as the cause for their SF closings in 2022. I expect there is corporate ass-covering happening by painting bad news as caused by factors external to the company and the market.

When this happened in SF with Walgreens people said that the stores that were closed were actually under performing to begin even without theft factored in, and that theft was used as an excuse to cover it up. Is it a similar situation here?

Note that all 3 of the first sentences of the article say this exactly in slightly different ways.

> “While our underlying business is strong, these specific stores haven’t performed as well as we hoped.”

This doesn't exclude theft as the reason of the performance.

Walmart's last quarter sales were about 115 Billion [1]

There are about 4700 stores in the US [2]

That means Walmart has per-store-daily-sales in excess of 200k. According to [3] I'm actually down an order of magnitude (3 million in sales a day for the "average" store)

That would have to be a hell of a lot of theft.

[1] https://www.marketplacepulse.com/stats/walmart-us-retail-sal...

[2] https://www.statista.com/statistics/269425/total-number-of-w...

[3] https://www.zippia.com/answers/how-much-does-the-average-wal...

The theft amount doesn't need to equal the total sales of the store to be a problem. I don't know Walmart's margins, but grocery stores have on average a 2% profit margin.

If average daily shoplifting increases by 0.5% of average daily sales (an additional $1 of product stolen for every $200 of product sold), the profit of a grocery store drops by 25%. If average daily shoplifting increases 2% of average daily sales, the profit of the store drops to zero.

(Typically in these kind of stores employee theft of merchandise is non-zero, so the customer merchandise theft is impacting the business on top of the baseline employee theft numbers. If you're interested in this sort or thing, it tends to be discussed under the heading of "lossage")

"Walmart net profit margin as of January 31, 2023 is 1.91%."

https://www.macrotrends.net/stocks/charts/WMT/walmart/profit...

It's not like stores with big levels of shoplifting are likely to perform well, unless in some very specific situations

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