Walmart CEO: 'Stores will close' if theft at retailer doesn't slow down
AP
- Doug McMillon told CNBC that theft is 'higher than what it has historically been' at stores
- He said that along with stores closing if theft doesn't slow down, prices could be higher.
- Reuters previously reported that Walmart loses roughly $3 billion in theft each year.
Walmart CEO Doug McMillon issued a stark warning Tuesday: If theft does not slow down, the retailer will close stores across the country.
"Theft is an issue," he told CNBC. "It is higher than what it has historically been."
He added: "If that's not corrected over time, prices will be higher, and/or stores will close."
McMillon did not say during the interview how much money Walmart has lost in stolen items this year. Walmart did not immediately reply to an Insider request for that number.
But the world's largest retailer likely loses about 1% of its US revenue — or roughly $3 billion every year — to stealing by customers and employees, Reuters reported in 2015.
McMillon said the key to reducing theft is Walmart working with local law enforcement agencies and ensuring that those agencies are fully staffed.
The Bentonville, Arkansas-based retail giant is not the only retailer that has recently sounded the alarm on theft.
Missing inventory has reduced Target's gross margin by more than $400 million in 2022 compared with last year, and Target expects those profit losses to grow to $600 million by the end of the fiscal year, Target CFO Michael Fiddelke said in November during a company earnings call.
Target predominantly blamed the inventory shrink on organized crime.
"Along with other retailers, we've seen a significant increase in theft and organized retail crime across our business," Target CEO Brian Cornell said during the earnings call.
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