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Happy meals will soon be harder to find at Walmart.
| Ticker | Safety | Last | Alter | Alter% |
|---|---|---|---|---|
| MCD | MCDONALD’S CORP. | 231.58 | +1.49 | + 0.65% |
| WMT | WALMART, INC. | 139.73 | -0.02 | -0.01% |
This summer, hundreds of McDonald’s eateries in Walmart stores across the U.S. will be closed due to sluggish business – a trend accelerated by the pandemic.
The decades-old partnership between the largest restaurant chain and the largest retailer in the world has been weakening for years. There were about 1,000 McDonald’s restaurants in Walmart stores during their heyday, but by 2020, there were half as many McDonald’s stores, Walmart confirmed.
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In July, McDonald’s said in its second-quarter earnings report that it would close 200 restaurants by 2020 and that more than half of them were in Walmart’s “lower sales volume.”
By the end of the summer, only 150 McDonald’s stores will remain at Walmart, the retailer confirmed.
The accelerated pace of store closures was first reported by the Wall Street Journal.
Happy Meals will soon be harder to find at Walmart. This summer, hundreds of McDonald’s eateries in Walmart stores across the U.S. will be closed due to sluggish business – a trend accelerated by the pandemic.
McDonald’s is doing a significant amount of business via its drive-thrus – more since the pandemic began – and Walmart does not have that option, sources have pointed out. The margins at McDonald’s Walmart locations were also hit as ‘customers who sometimes loaded and loaded spices’, according to the Journal. Walmart has also largely stopped building new stores, but to remodel them, which, according to the newspaper, has created awkward situations.
“You can not do a million-dollar renovation in a store and then have a 1980s McDonald’s up front,” one source told the Journal.
According to the newspaper, subway eateries are also moving into Walmart stores. The franchise faces its own challenges, as The Post reported, with stores closing across the country.
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Walmart, which has long relied on rents from restaurants and other in-store tenants to clinch its core, said its stores will switch to more grab-and-go options. In addition to food, Walmart also rents space to banks, hair and nail salons, and veterinary clinics. In Texas, he has a number of tool rental stores in his stores, the company said.
“We have a wonderful opportunity with our leased space business to help our stores become even more convenient and relevant to local communities,” the company said in a statement. “We are excited to continue to bring in new businesses that make sense for our customers and their changing needs.”
Walmart is testing smoothie vending machines in stores and opening Charleys Philly Steaks locations, which is a chain of 600 stores, and Walmart is also working on a Sushi concept in its home state of Arkansas and a concept called Ghost Kitchens, which is attracting customers in enables you to order food from other restaurants.
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The company is also in talks with Domino’s to add more locations to the existing 30 eateries at Walmart. However, the pizza chain had to convince Walmart that it would not harm Walmart’s frozen pizza business, according to The Journal.
McDonald’s declined to comment on the story, pointing to his previous statements about slow business at Walmart locations.