In case any other retailers are looking at Chicago, Walmart is a good barometer.
Want to get your ass handed to you. Try to open a large retail store in Chicago.
Walmart fought hard to open the stores it’s closing Sunday on the South Side, West Side
Four Walmart locations are set to close, a shock to those who remember the retailer clawing its way to do business in the city.
By Natalie Moore | WBEZ and Clare Lane | WBEZ Apr 14, 2023
After saturating rural and suburban America, Walmart heralded a new strategy in the early 2000s, opening stores in Chicago and other cities.
But the world’s largest retailer faced a daunting challenge as it sought to plant a flag in Chicago, a union town. Activists protested, jobs coalitions pressed for living wages, and owners of small businesses worried Walmart would squeeze them out.
Then, 17 years ago, Walmart prevailed with promises of amenities and economic development when it opened its first big-box store in Chicago on the West Side.
After that, Walmart set its sights on the South Side to build a supercenter on a vacant piece of land at 83rd Street and Stewart Avenue. Again, community pushback demanded better wages from a company known for being anti-union.
Walmart courted a reluctant Chicago and waged a public relations campaign, sponsoring a farmer’s market, passing out free watermelon and promising diversity and jobs for the formerly incarcerated.
In 2012, a Walmart Supercenter opened in Chatham, with 350 jobs.
At an opening celebration, Ald. Howard Brookins (21st) said: “It was worth the fight. Chicagoans who live on the South Side deserve to have the same economic opportunities Chicagoans on the North Side take for granted.”
On Sunday, though, that supercenter and three smaller Walmart convenience stores — neighborhood markets in Lake View and Little Village and another on the Grand Boulevard-Kenwood border — will close for good after less than a week’s notice, a shock to customers and those who remember Walmart clawing its way to do business in Chicago.
South Siders slam Walmart over plan to close stores, threaten protests at other Walmarts
Announcing the closings, company representatives said: “The simplest explanation is that collectively our Chicago stores have not been profitable since we opened the first one nearly 17 years ago — these stores lose tens of millions of dollars a year, and their annual losses nearly doubled in just the last five years. The remaining four Chicago stores continue to face the same business difficulties, but we think this decision gives us the best chance to help keep them open and serving the community.”
Walmart also said community and city leaders have been open and supportive over the years but that there was nothing the company could do to make the stores that are being closed profitable.
Nedra Sims Fears, executive director of the Greater Chatham Initiative, was surprised to hear that.
“Everything was so short notice that you really don’t have an opportunity to plan,” Fears said. “Walmart said that they had worked with the community, but I don’t know who they worked with in the community to let us know that they were struggling, that they weren’t profitable. I know, from cellphone data, 270,000 people visit that store every year.”
Brookins said Walmart alerted him about the closing of the store in Chatham two hours before the announcement, which surprised him because the store reopened and renovated after the civil uprisings of 2020.
But the outgoing Chicago City Council member said company officials told him the store was losing money because of higher security costs and theft.
Brookins said he has no regrets and said pushing for Walmart to come to his community was the right thing to do. Lowe’s opened by Walmart and across the street a Studio41 Home Design store opened, which he points to as evidence that business begets business.
“There were a dearth of shopping outlets in the African American community,” Brookins said. “Clearly, we can’t, as a community, expect to have to leave the community to get any types of goods and services we need.”
But he said national retailers like Walmart haven’t figured out how to operate in an urban market.
Private companies, of course, don’t have to open their books to prove that stores aren’t profitable. But some Walmart shoppers are dubious.
“This place is never a ghost town,” Chatham resident Marlon Lacey said of the store in her neighborhood. “Something just doesn’t sound right, but I wish that we had someone independent to actually do the numbers to find out the money that they really were making. My son’s barber is here. My daughter’s school is around the corner. So, if I needed anything from Walmart, I could just come right here. But not now.”
Lacey was among shoppers at the Chatham supercenter’s busy parking lot a day after Walmart announced the shutdown. People were loading up on groceries, televisions and workout equipment. They hugged employees as Pace buses dropped off customers with disabilities.
“It sucks because a lot of people are losing jobs because of this,” shopper Jermell Conwell said. “This is the neighborhood I grew up in. And, when we heard this was coming, it was exciting. And now it’s sad. And they’ve done a lot of remodeling to it. And what was the point of doing all the remodeling if you knew you were all going to close down?”
Walmart employee Anneka Ellis said two older customers cried to her.
“They were saying that they don’t have a way to get to another store,” Ellis said. “They stay in the neighborhood, and I understand … This is their neighborhood store, and they need it,” Ellis said. “It’s sad. I’ve been here for nine months, and now it’s like what do I have to do with such late notice?”
Walmart still has stores in Chicago. But its legacy is tied to jockeying for a presence on the South Side and West Side and energizing a labor movement that had been in opposition.
“Walmart coming in to Chicago and their low-wage-worker model, big-box way of doing business has influenced our policy agenda,” said Bob Reiter, president of the Chicago Federation of Labor.
In 2006, the Chicago City Council defied Mayor Richard Daley by passing a big-box ordinance that upped wages for employees. In 2009, other labor groups pushed for even higher wages and health care. Even after smaller stores opened in the city — like the one closing in Lake View — organizers locally and nationally kept after Walmart for better pay.
“The fight with Walmart helped lead to us building a foundation for higher minimum wage, earned sick leave, predictive scheduling — all those things sort of flow out of those initial fights with Walmart,” Reiter said.