Lowe’s Shutting Down Stores, Slowing Future Openings
The flaccid economy continues to present problems for some of the nations largest companies. With less money available for home improvement-style projects, Lowe’s is forced to change their business model.
Home-improvement retailer Lowe’s Cos. says it will close 20 underperforming stores in 15 states and cut 1,950 jobs in a move that it says will allow it to focus on more profitable locations.
The loss of almost 2,000 jobs and 20 less stores is just the start; They also plan to slow expansion efforts to match demand.
Lowe’s, based in Mooresville, N.C., also says it will only open 10 to 15 stores in North America annually beginning in 2012. Previously the company expected to open 30 stores per year. It will open 25 stores this year.
Again, the cause is the sluggish economy. People are f0rced to spend their ancillary income on essentials – putting off major or even minor home improvement projects.
In August, Lowe’s said volatile weather and shoppers’ worries about the economy hurt demand. Its net income was nearly flat in the second quarter and the company lowered its yearly sales forecast.