Walmart Inc. will close Store No. 8, a startup incubator and innovation hub for the big-box retailer, The Wall Street Journal reported Friday. It's the latest move by a retailer to cut expenses and protect profits as shoppers continue to grapple with high prices.
CFO John Rennie told employees in a memo that much of what Store No. 8 did was already integrated into the company's operations as a whole, the newspaper said.
“We have graduated capabilities from this operational approach that are now an integral part of our organization,” Rennie said in the memo, according to the newspaper.
He continued: “The responsibility for shaping the future of retail trade is now shared between all sectors.”
Walmart launched Store No. 8 in 2017 in an effort to experiment with new ideas, including augmented reality, artificial intelligence and new ways of presenting products, and to stay nimble in a retail landscape increasingly defined by online shopping. Scott Eckert, who led Store No. 8, was leaving the company, the newspaper said.
Walmart did not immediately respond to a request for comment. Shares rose slightly after hours, after closing down 0.5% on the day.
Some analysts believe Walmart can hold on to the high-income shoppers it has attracted during the past two years of high inflation. But in a possible sign of its priorities, the retailer on Thursday announced pay increases for store managers and a bonus program based more on store profits.
Walmart and other retailers have indicated they are rethinking what technology to invest in and which stores to stay open. These decisions will come after years of adoption of online selling, pandemic-related shopping disruptions, and a jump in prices for basics that began in 2022 and pushed people away from buying things like laptops and clothes.
Elsewhere on Thursday, Macy's Inc. M,
It said it would lay off corporate employees and close a few stores amid efforts to adapt to the “ever-changing consumer and market” and “evaluate the right mix of locations inside and outside malls.”
The Wall Street Journal, which first reported the news, said Macy's intends to bring more automation to its supply chain and invest “in areas that impact consumers,” such as visual displays in stores and efforts to streamline the online shopping experience.
CVS Company CVS,
Meanwhile, it said it would close some Target Corp. pharmacies. TGT,
Stores because they are moving towards health services.
