Walmart Releases Memo to Campus Employees
In mid-May, Walmart issued a company-wide memo announcing that significant layoffs would occur at the retailer’s campus offices over the next month, per NPR.
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The retail giant’s announcement will affect hundreds of corporate positions throughout the company and is part of an extensive relocation plan being ushered in by the company.
Walmart CPO Speaks on Layoffs
The memo from Walmart’s CPO, Donna Morris, that was shared with USA TODAY, further touched on the layoffs that are set to occur at many of the retail giant’s corporate offices.
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Morris said changes in “some parts of our business will result in a reduction of several hundred campus roles.”
Stores Are Starting to Close
News of the layoffs comes as the company announces that it will be closing Neighborhood Markets in Aurora, Colorado, and Milwaukee, Wisconsin, as well as a Bay Area store.
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This news confirms the closure of nine Walmart stores in the US in 2024.
Why Are These Stores Closing
Notices of layoffs filed with the states of Colorado, Wisconsin, and California follow the closures of four stores in California, one store in Maryland, and one store in Ohio earlier this year.
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According to Business Insider, these stores were not meeting the financial performance expectations that the company has for its supermarket stores.
Walmart Is Grateful to the Workers Its Laying Off
“We are grateful to the customers who have given us the privilege of serving them at our San Diego and El Cajon stores,” Walmart spokesperson Brian Little said in a statement to Business Insider in January.
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“We look forward to continuing to serve them at any of our many locations across the area, on Walmart.com, and through delivery to their home or business.”
Walmart Is Still a Mega Operation
Walmart workers are eligible to transfer to another location in cases where the stores are set to close.
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However, despite Walmart’s vast network of over 4,600 retail locations in the US, which includes 3,559 Supercenters, 357 discount stores, and 673 Neighborhood Markets, some locations are not meeting the standards of the mega-retailer.
Walmart Isn't in Danger
However, other locations are performing so well that the company plans to open a dozen more across the US this year. Four of these new locations will be in Texas—three in Dallas and one near Houston.
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Additionally, Walmart will build or expand more than 150 stores in the next five years.
Trying to Prevent Theft
Retailers are facing tough times as theft reaches record highs across the country.
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Some stores have resorted to putting high-interest and high-value items behind lock and key to prevent theft, while others, like Walmart, are increasing prices to offset losses.
Stores Are Losing Millions of Dollars
“These stores lose tens of millions of dollars a year, and their annual losses nearly doubled in just the last five years,” Walmart said in a press release.
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“We have invested hundreds of millions of dollars in the city [of Chicago]… It was hoped that these investments would help improve our stores’ performance. Unfortunately, these efforts have not materially improved the fundamental business challenges our stores are facing.”
Walmart CEO Threatens to Raise Prices
Walmart CEO Dough McMillion told CNBC’s “Squawk Box” that they will be increasing prices and security measures in stores to help limit loss of revenue.
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“We’ve got safety measures, security measures that we’ve put in place by store location. I think local law enforcement being staffed and being a good partner is part of that equation, and that’s normally how we approach it,” McMillon said.
Walmart Isn’t the Only Retailer to Raise Prices
Walmart isn’t the only retailer taking security measures to prevent revenue loss. Last month, Target Chief Financial Officer Michael Fiddelke said shoplifting has jumped about 50% over the last year.
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Organized retail theft comprises most of the shoplifting incidents, rather than petty theft.
Righting a Wrong
McMillion states that correcting most of the theft varies from city to city but requires implementing higher prices or closing store locations over time.
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“It’s really city by city, location by location. It’s store managers working with local law enforcement and we’ve got great relationships there for the most part,” he added.
Walmart Calls for Remote Workers to Return to Office
During the announcement, Walmart also announced its plan to bring almost all of the company’s current remote workers back to its primary offices. This includes corporate employees working in the Atlanta, Toronto and Dallas offices.
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The personnel have been requested to move to the retail giant’s main offices, which are situated in Hoboken, New Jersey, Bentonville, Arkansas and the San Francisco Bay Area.
Workers Required to Relocate
Walmart is requesting remote workers to relocate to offices, resulting in the elimination of hundreds of corporate roles as the company shifts staff to smaller locations.
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Many of these employees, currently situated in small offices in Dallas, Atlanta, and Toronto, will need to relocate to major cities, such as Walmart’s global headquarters in New Jersey or Arkansas.
Corporate Employees Relocated to Arkansas
During a portion of the memo, Morris touched on the subject of relocation for many of the Walmart corporate workers, revealing that most will move to the company’s home office in Arkansas.
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“Most relocations will be to our Home Office in Bentonville, but some will be to our offices in the San Francisco Bay Area or Hoboken/New York,” Morris said in the memo.
Reasons Behind the Layoffs and Relocations
While Walmart will continue to allow a small portion of staff to work remotely part-time, Morris explained that they will be expected to work from the principal corporate offices.
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The CPO went on to explain the reasoning behind the recent layoffs. “We believe that being together, in person, makes us better and helps us to collaborate, innovate, and move even faster,” Morris said. “We also believe it helps strengthen our culture as well as grow and develop our associates.”
Support for Those Affected by the Change
Walmart’s Chief People Officer, Donna Morris, stated that the retail store is trying to step up efforts to streamline its personnel workforce and cut costs.
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In the public message, Morris stated, “Although the number of positions lost is small in percentage, we are focused on supporting each of our associates affected by these changes,” (via GistFest).
Walmart Dedicated to Supporting Former Associates
Speaking on those affected by the playoffs, Morris said that while the number of jobs cut “is small in percentage, we are focused on supporting each of our associates affected by these changes.”
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She continued, “We have had discussions with associates who were directly impacted by these decisions. We will work closely with them in the coming days and months to navigate the best path forward.”
Getting Workers Back to the Office
Walmart, currently the largest employer in the United States, is one of many companies in the nation trying to get the majority of its workers to return to work.
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According to Business Insider, the return-to-office mandate “is a way of getting rid of employees without conducting mass layoffs.” Many refer to this method as quiet firing, as it is a subtle way to make job roles less appealing and ultimately motivate workers to quit.
Retail Giant Axes Health Care Business
Walmart’s announcement of concurrent layoffs comes just a few days after the retail giant revealed it planned to shut down its virtual healthcare service, which began in 2019.
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In a statement released to the public, Walmart revealed its plans to close all 51 healthcare centers as it realized that it was “not a sustainable business model.”
Senior Analyst Suggests Restructuring Is Occurring at Walmart
During an interview with USA Today, Blake Droesch, a senior analyst covering retail and e-commerce at research firm eMarketer, suggested the layoffs and closure of Walmart’s health program were connected.
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Droesch theorized the closure of the health clinics could be “part of a restructuring that would allow Walmart to allocate additional resources to more profitable revenue streams, like advertising and fulfillment.”
Walmart Aims to Prioritize Corporate Strategy
According to Droesch, Walmart is hard at work prioritizing its corporate strategy, which also included closing several stores located in underperforming regions. They also acquired Vizio, a smart TV manufacturer.
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“Walmart has also been laser-focused on creating alternative revenue streams that go beyond its retail business,” Droesch said.
Walmart Aims to Increase Entry-Level Positions
Droesch alluded to Walmart’s apparent restructuring of the business in an attempt to increase entry-level positions. He said, “By reducing their corporate headcount, the retailer could allocate more resources to its store and warehouse staff.”
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“These jobs are the true lifeblood of the retail business, and Walmart has prioritized workforce retention in what has become an increasingly competitive labor market.”
