Walmart has unveiled plans to close around 10% of its Sam´s Club branded wholesale stores and make thousands of workers redundant. The US retailing giant presented a bitter-sweet pill for its workforce as it also announced an increase in minimum wages.
Walmart is to close over 60 of the Sam´s Club cash-and-carry type stores, as part of plans to refocus the chain to target higher-earning households, those with incomes of between $75,000 and $125,000.
"Transforming our business means managing our real estate portfolio — we need a strong fleet of clubs that are fit for the future. After a thorough review, it became clear we had built clubs in some locations that impacted other clubs, and where population had not grown as anticipated. We've decided to right-size our fleet and better align our locations with our strategy,” said Sam Club chief executive John Furner.
News that Walmart was raising its minimum wage was seized upon by the US government as evidence that companies were sharing the benefits of the Trump administration´s recent cut in the top rate of corporate tax from 35% to 21%.
Walmart said it would increase the starting wage rate for all hourly associates in the US to $11, expand maternity and parental leave benefits and provide a one-time cash bonus for eligible associates of up to $1,000.
The company claimed the wage and benefit changes would benefit the company’s more than one million US hourly associates.