Walmart Canada is investing over $500 million this year in its store network, focusing on refurbishing and refreshing stores across the country and making it the largest ever yearly investment in store upgrades.
But the retail giant also announced Monday it is closing six stores: Malton, ON, Hamilton (County Fair), ON, Calgary (Deer Valley), AB, Edmonton (Abbotsfield), AB, Kitchener East (ON), St. John’s South, Nfld. Each of these locations is in a market that is already well served by other Walmart stores, it said.
“We are on a mission to modernize all aspects of our business and that includes our stores,” said Horacio Barbeito, President and CEO of Walmart Canada, in a statement.
“Investing in our stores is a major priority. In so many cases our stores are pillars in the community, and we want them at their best – especially as we serve our customers in more omnichannel ways.”
The investments include:
- Upgrading Supercentres by enhancing the look and feel of the store for example with improved lighting, repairs, paint, new signage, and a refreshed exterior front look;
- Upgrading and improving staff lounges;
- Enhancing some of its highest e-commerce volume stores with an improved picking space for online orders;
- Revamping sales floor layout in select stores;
- Walmart Canada’s first automated market fulfilment centre inside the Scarborough West Walmart Supercentre; and
- The Calgary Northland Walmart and the Kitchener Walmart will be converted to Supercentres, and will feature an assortment of fresh groceries, general merchandise, and services available.
The company said the work is expected to create more than 2,000 construction jobs in Canada.
“The Walmart Canada store modernization announcement is a major affirmation of the importance of bricks and mortar retail and a vote of confidence in communities across the country,” said Michael Kehoe, a national retail expert and broker/owner of Fairfield Commercial Real Estate in Calgary.
“This significant investment by Walmart and the related construction jobs will reverberate across the Canadian economy as the country emerges from the recent pandemic era challenges. Retailing now more than ever is a Darwinian struggle and innovative omni-channel retail models that are both contemporary and efficient are essential especially for a gorilla-sized merchant like Walmart with over 400 stores nationwide.”
Walmart said that more than 60 percent of all its stores in Canada will be improved by the investment. It is all part of the retailer’s planned $3.5 billion investment over the next five years to make the online and in-store shopping experience simpler, faster, and more convenient.
“When a customer chooses to shop at our stores we want to do everything we can to ensure they are met with the best and most modern experience possible,” said Sam Wankowski, Chief Operations Officer, Walmart Canada. “We are making a lot of improvements, including digitizing the experience to be more contemporary and creating a more efficient store to serve our customers regardless of how they choose to shop with us.
“Over this past year we’ve certainly seen the customer behaviour has really dictated the experience that they want in a retail store. So as we’ve seen our stores, and what our customers expect, really transform and bringing together all the great products that you would expect at a Walmart at obviously unbeatable prices equally we’re thinking about the stores changing and clearly a focus on digitizing what we do, opening up obviously more services like online groceries and delivery to our customers. Something that they told us really clearly that they’re enjoying. Clearly, our investments this year really, really enforce the fact we feel really strongly about our business here in Canada. We want to continue to play an important role in supporting Canadians in the communities that we serve and we want to do that obviously with the best and most modern experience that we see possible.”
Wankowski said the retailer reaches essentially about 80 percent of the Canadian population within a 10-kilometre radius. But the company is always evaluating where there is potentially a community that may be under-served.
When asked about the closure of the six stores, he said: “We’re always continually evaluating our store network to ensure that we continue to meet the very expectations our customers and community have. As we’ve done that evaluation, we’ve made the tough decision to close those locations. And look, those are not easy decisions. My focus and the team’s focus right now is supporting all of the associates who are obviously impacted in these stores and I’m pleased to say all of associates will be offered positions at nearby Walmart locations and we already have stores in each of those markets where we will be closing those stores. But equally we made that decision knowing that we’ve got stores in those markets that we believe we’ll still be able to serve that customer really well right now and in the future.”
The company has more than 400 stores across Canada with about 1.5 million customers every day. It employs more than 100,000 people. Wankowski said about 90 percent of the company’s Canadian stores are now classified as Supercentres.
“I think these investments by Walmart are desperately needed to keep them competitive in the new normal of retail. With COVID-19 and its acceleration of trends such as the growth in online shopping, Walmart has no choice but to make their shopping experience more user friendly for a growing group of consumers who demand more,” said Bruce Winder, author of RETAIL Before, During & After COVID-19 and President of Bruce Winder Retail.
“These investments come with controversy as suppliers are being asked to fund a portion of them at a time when margins are being squeezed on the vendor side as a result of higher operating costs due to shipping mayhem and other costs associated with the pandemic. Over time, Walmart’s virtual monopoly in discount in Canada is at risk of being further eroded with incumbents such as Amazon and Costco offering strong go-to-market strategies.”