MEXICO - Lowe’s stores in Mexico closed their doors on April 10th making effective its withdrawal from the country.
Although the news surprised the market, the home improvement retailer had announced in November 2018 its intention to analyze leaving Mexico, where it operated 13 stores and for which it was evaluating different alternatives.
The arrival of Lowe’s to Mexico occurred in 2010, opening its first two stores in Monterrey, Nuevo León. Less than a year ago Lowe’s opened its last stores in Aguas Calientes (July 18, 2018), León, Guanajuato (July 15, 2018) and Santa Catarina (June 26, 2018).
Information provided by an internal source to Milenio Monterrey, explained that Lowe’s did not achieve the levels of sales necessary to maintain its operations in the country, as it could not compete with the predilection of Mexicans for its competitor, Home Depot.
Lowe’s strategy of streamlining its operations with the closure of underperforming stores has not only affected Mexico. In 2018 the company announced the closure of 51 underperforming stores in the United States and Canada, which followed with the closing of 99 Orchard Supply stores in California.
During the third quarter, USD 22 million of long-lived asset impairment was recognized on certain assets in Mexico as a result of the strategic evaluation. During the fourth quarter, an additional USD 222 million of impairment was recognized. Total charges for fiscal year 2018 were USD 244 million of Mexico impairment charges.