Former CEO says Walmart store closures are a good sign for e-commerce

Key Points
  • Former CEO of Carter Cast applauds Walmart's moves toward e-commerce.
  • He predicts Walmart will continue to close brick and mortar stores and grow online sales to more than 10 percent.
Former CEO: I'm 'impressed' by the retail giant's online growth
Former CEO: I'm 'impressed' by the retail giant's online growth

Unlike some retailers, store closures will be a marker of strength for Walmart, according to former CEO Carter Cast.

"I think there are store closures ahead of Walmart that are going to be good for the company and good for shareholders," Cast said on CNBC's "Power Lunch."

Cast, who worked with Walmart from 2000 to 2007, applauded Walmart's efforts to adapt to online commerce, in a time of change for retail.

Widespread restructuring in retail led to unprecedented job cuts across the sector in 2017. Pressure from online commerce in part contributed to the cuts and led to a rash of store closures, even among household names.

But where retailers like Macy's and Toys R US have struggled, Cast said Walmart has flourished. He predicted an uptick in online sales for the retailer.

"I believe Walmart will continue to use the internet and grow their e-commerce sales for about 4 or 5 percent now to well over 10 percent," Cast said.

His outlook for the rest of the industry wasn't quite so rosy, emphasizing that retailers just own too much brick and mortar space.

"There is no question, there is too much square footage in the industry now," he said.

And while Walmart certainly commands a lot of real estate, Cast seemed confident that even with more closures, the retailer could still keep much of its U.S. customer base within close range.