McDonald's Is Closing Hundreds of Walmart Locations
At the end of last month, some Walmart shoppers in Ammon, Idaho were surprised when they noticed that the in-store McDonald's had closed after 18 years of serving customers who got hungry pushing their carts up and down the aisles. Lindsay Rainey, a spokesperson for McDonald's USA, told East Idaho News that two of its other restaurants inside Idaho Walmarts would also be closing.
"Our people are one of our highest priorities, and with the closure in Ammon, all employees of the restaurant have been offered positions at [other McDonald's locations]," Rainey said. "Closing a restaurant is a difficult decision in any town but we look forward to continuing to serve our customers at our other McDonald's restaurants in the neighboring communities."
The McDonald's inside a Walmart in Camden, Delaware—the town's only McD's—also closed last month, as did three in-Walmart locations in Bradenton, Florida. According to The Wall Street Journal, these closures aren't the only ones: McDonald's is reportedly shuttering all but 150 of its Walmart-based restaurant locations between now and this summer. (Walmart's website says there are currently 4,743 Walmarts scattered throughout the United States. If you took AP Math, you've already calculated that just over 3 percent of Walmarts will still have an in-store McDonald's.)
McDonald's and Walmart have had a symbiotic relationship since 1994 and, at one point, 1,000 Walmarts had their own McDonald's locations. That number had slipped to around 875 by 2012, dropped to 638 in 2017, and fell to about 500 by the beginning of 2020. The fast-food giant went through two rounds of Walmart-related closures last year, which were both planned before the pandemic—although the Journal reports that McDonald's "sped them up" when things took an unprecedented turn.
Last July, McDonald's announced that it would be closing 200 restaurant locations—including 100 that were inside Walmart stores—due to decreases in sales volume. Analysts noted that capacity restrictions inside retailers and an increase in grocery deliveries and curbside pickups likely contributed to a decline in demand for those locations. And then there was our newfound preference for the drive-thru. Kevin Ozan, McDonald's Chief Financial Officer, said that a super-sized 90 percent of the chain's sales were made through drive-thru windows during the second quarter of last year.
Walmart is now trying to figure out what to do with those now-empty spaces where a McDonald's used to be. The Journal reports that it is giving Taco Bell a trial run in some locations, others may get a Domino's Pizza (some 30 Walmarts already have a Domino's), and it plans to open at least 10 Charleys Philly Steaks in some stores. It is also giving smoothie vending machines a try. "We took a turn to make sure what we are doing matched up with the strategy for the company," Linne Fulcher, Walmart's vice president of customer strategy, said.
If you're a loyal McCustomer, this shouldn't affect your ability to get a Big Mac meal at all: McDonald's still opened around 500 restaurants worldwide last year, and has plans to open another 1,300 new locations before the end of 2021.