Walmart CEO warns company will close stores if rampant theft continues
Walmart CEO Doug McMillon warns of possible store closures and price increases if the surging retail theft doesn’t slow down. The company’s boss issued this stark warning on Tuesday. Shoplifting cases were at an alarming rate in their retail stores.
Doug Macmillon has been running Walmart since 2015. He confirmed that the retailer has undergone a surge in “Shrink.” It is a business term that addresses losses due to fraud or in-store theft. The CEO also said they might shut down stores where local governments practice a soft-on-crime approach.
McMillon said during a CNBC interview, “Theft is an issue. It’s higher than what it has historically been. We’ve got safety measures that we’ve put in place by store location.”
Walmart CEO warns company will close stores if theft doesn't slow down. At the moment Walmart is losing roughly $3 Billion a year in theft‼️👀 pic.twitter.com/g8Mqpz7Cxt
— Daily Loud (@DailyLoud) December 9, 2022
The CEO added, “I think local law enforcement being staffed and being a good partner is part of that equation, and that’s how we approach it. If that’s not corrected over time, prices will be higher, or stores will close.” He confirmed that Walmart applies a “city by city” and “location by location” approach to how it deals with shoplifting.
During the interview, McMillon didn’t disclose how much money the company has lost to stolen items this year. However, the world’s largest retailer loses about 1% of its total US revenue.
It is roughly $3 billion worth of loss annually due to theft from customers and employees. Sticky fingers have been snatching from Walmart for decades, with so much revenue at stake. The company must protect itself as best as possible by putting necessary measures in place.
Walmart’s possible closures
The Walmart CEO did not discuss the number of stores potentially facing closure. Although he didn’t disclose specific numbers, this could have significant implications.
Walmart has over 10,000 stores across the globe and almost 5,000 in the US alone. McMillon didn’t elaborate on which locations might close. However, it will certainly impact the retail industry as a whole.
WALMART WARNING: CEO says retailer will close its stores if rampant theft doesn't stop@JoeGamaldi: Retail theft is pushing $95B. Yet some so-called journalists/politicians say it's, "just a victimless crime." They're either lying or just ignorant about how the real world works. pic.twitter.com/LlwHl4sgrX
— National Fraternal Order of Police (FOP) (@GLFOP) December 8, 2022
Walmart’s CEO just became the latest high-profile executive to sound the alarm over “organized retail crime.” It has staggering economic implications. In addition, Target CFO Michael Fiddelke recently revealed that losses due to theft had already wiped out nearly $400 million in profits. The company projected losses to jump to more than $600 million for the full year.
Target CEO Brian Cornell said that his company had already “seen a significant increase in theft and organized retail crime across our business.” Moreover, in The Post’s report, Rite Aid felt the effects too. Their executives complained about a $5 million headwind caused by shoplifting in NYC, with increased losses year-over-year.
