Walmart Inc. (NYSE:WMT) is removing cigarettes from its stores in several states following a long-running debate on whether to ban tobacco products from being sold.
What Happened: According to a Wall Street Journal report citing unnamed “people familiar with the matter,” cigarettes are being removed in various markets, including the retailer’s home state of Arkansas in addition to California, Florida and New Mexico.
Walmart operates more than 4,700 stores in the U.S. and the termination of cigarette sales is not happening nationwide. In the markets where the product sales are being discontinued, new self-checkout registers and displays for grab-and-go food and candy are being added to the sections where tobacco products were previously placed for sale.
“We are always looking at ways to meet our customers’ needs while still operating an efficient business,” said a company spokesperson.
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Why It Happened: Walmart has been debating the question of tobacco products for years and had slowly begun to discontinue sales of these items before the COVID-19 pandemic. Part of the debate centered on revenue: cigarette sales are reportedly less profitable than other front-of-store items including candy and must be kept in a locked case or blocked from easy shopper access.
Then, there is the question of Walmart's expansion into the health care space. The company acquired the telehealth provider MeMD last year and it operates both an in-store pharmacy chain and is opening primary-care clinics in select markets.
Walmart is among the few major retailers still selling tobacco products — rival Target Corporation (NYSE:TGT) stopped sales in 1996 while CVS Health Corp. (NYSE:CVS) pulled the plug in 2014.
Photo: Mike Mozart / Flickr Creative Commons
