U.S. Retailers Already Announced 6,000 Store Closures This Year. More Than Last Year

[M II A II R II K]

American Retailers Already Announced 6,000 Store Closures This Year. That's More Than All Of Last Year


April 16, 2019

By Nathaniel Meyersohn

Read More: https://www.cnn.com/2019/04/16/busin...ies/index.html

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Bankruptcies in the retail sector are piling up and chains have aggressively closed under-performing stores. That has led to an uptick in store closures this year. Payless, Gymboree, Charlotte Russe and Shopko have all filed for bankruptcy this year and will close a combined 3,720 stores, according to the report. The majority of those are because of Payless, which filed for its second bankruptcy in February and said at the time it would shutter 2,100 stores in the United States.

- Other retailers, such as Family Dollar, GNC (GNC), Walgreens (WBA), Signet Jewelers (SIG), Victoria's Secret and JCPenney (JCP), are struggling and are shrinking their store footprints to save money. Family Dollar will close 359 stores this year, while Signet Jewelers, the parent company of mall stalwarts Kay, Jared and Zales, will close 159. — Even thriving retailers such as Target (TGT)and Walmart (WMT) are quietly closing a handful of their stores although those companies are opening some, too. And department stores such as Nordstrom (JWN), Kohl's (KSS) and Macy's (M) are shuttering a few stores each.
Thousands more store closings could be on the way in the coming years as online shopping replaces purchases at physical stores. "The flood of store closures will likely continue for quite some time," said Coresight Research CEO Deborah Weinswig.

- Online sales make up around 16% of retail sales today, but they will rise to 25% by 2026, UBS analysts estimated in a research report last week. That could force up to 75,000 stores to close by 2026, including more than 20,000 clothing stores and about 10,000 consumer electronics stores, UBS estimates. Thousands of home furnishings and sporting goods stores will also need to close as online shopping grows rapidly. Some retailers are opening stores, though. The Coresight report noted that this year, retailers have announced they will open 2,641 stores. The discount sector in particular is growing: Dollar General announced it will open 975 stores this year. — Meanwhile, eccentric discount chains like Ollie's Bargain Outlet (OLLI) and Five Below (FIVE) are expanding. Discount grocers Aldi and Lidl also plan to open hundreds of stores in the United States to reach customers who are shopping for cheap groceries.

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[Pedestrian]

https://www.wsj.com/articles/what-re...&page=2&pos=16

[M II A II R II K]

The loss of all those jobs could create more rust belt phenomena more widespread.

[JManc]

No. The Rust Belt became as such due to the loss of high paying manufacturing jobs. Store closings will have marginal effect. There will be other low paying service sector jobs. The high paying blue collar jobs never came back.

[Nite]

Originally Posted by Pedestrian

https://www.wsj.com/articles/what-re...&page=2&pos=16

The upside to these closures is that it should help the remaining stores get more businesses.

Personally I pretty much only go to Walmart physically and buy everything else I need online.

[dave8721]

Originally Posted by JManc

No. The Rust Belt became as such due to the loss of high paying manufacturing jobs. Store closings will have marginal effect. There will be other low paying service sector jobs. The high paying blue collar jobs never came back.

The low paying service sector jobs are being replaced by even lower paying "gig" jobs. Basically delivering groceries or driving for uber.

[Sun Belt]

I'm already feeling the sporting goods closure episode. Once Sports Authority and Sport Chalet went belly up, that really eliminated options. Dick's is still around, but it's like a ghost town in there every time I go. I have a feeling it won't be long before they announce closures/bankruptcy.

[Sun Belt]

Originally Posted by dave8721

The low paying service sector jobs are being replaced by even lower paying "gig" jobs. Basically delivering groceries or driving for uber.

Minimum wage retail workers will become independent contractor Amazon delivery drivers. It could be worse. One day Amazon will be broken up as the retail carnage continues and Amazon gets their fingers farther into other sectors like drug distribution.

[M II A II R II K]

If enough retail shuts down perhaps a benefit could be aiding with the affordable housing problem.

[JManc]

Originally Posted by dave8721

The low paying service sector jobs are being replaced by even lower paying "gig" jobs. Basically delivering groceries or driving for uber.

Do these Uber jobs really pay lower than working at Payless?

[iheartthed]

Originally Posted by JManc

No. The Rust Belt became as such due to the loss of high paying manufacturing jobs. Store closings will have marginal effect. There will be other low paying service sector jobs. The high paying blue collar jobs never came back.

There will be (or already is) an issue with an excess of commercial retail inventory. Malls are struggling in a lot of places, and the only good solution so far is to turn them over to the municipalities and tear them down.

[muertecaza]

Originally Posted by JManc

Do these Uber jobs really pay lower than working at Payless?

Depends, but they can. See e.g.:

https://www.ridester.com/uber-fees/

There are studies cited, including one where Uber drivers in Detroit were earning slightly above minimum wage after expenses.

[osmo]

GNC isn't surprising as even with the wellness and fitness boom we see their stores still feel dated. Here in Canada we have Popeyes supplements and the store are much better versus GNC. At Popeyes the staff try everything and will tell you honestly what is good and what is junk. They also let you try samples of almost anything and you can purchase a single serving to try for a workout. Everythjng GNC offers can be found online (for much cheaper).

[pdxtex]

interesting history lesson. prior to the early 50s, mall development wasnt that widespread, its wasn't until our own federal government changed a few of the corporate income tax laws in 1954. before then, developers were allowed to take deductions on their projects. it was assumed building had a 40 year life span so they could deduct 1/40th of the original buildings construction cost each year. then, in 1954, congress basically scrapped that and let developers take all of the depreciation deductions up front, basically making mall development tax free for many decades...and thats how america got malled.....

[tdawg]

I'm shocked Sears/KMart is still clinging to life.

[hauntedheadnc]

Sometimes you can't help but wonder that if the situation was allowed to reach its ultimate conclusion, we won't end up with nothing but Amazon and Wal-Mart for normal shopping, and ultra-specialized mom-and-pop boutiques for when you want something fancy or weird.

[suburbanite]

The death of bricks and mortar retail leaves a massive glut of low-skilled labor, with fewer and fewer jobs left to replace it.

Approximately 10% of Americans work in retail, and 2/3 of those are full-time. I do wonder if the demise of retail and things like the automation of long-haul trucking will be the triggers for something resembling a universal basic income.

[hauntedheadnc]

Originally Posted by suburbanite

Approximately 10% of Americans work in retail, and 2/3 of those are full-time. I do wonder if the demise of retail and things like the automation of long-haul trucking will be the triggers for something resembling a universal basic income.

Not before we devote about a decade or so to blaming and attacking minorities and immigrants for rising unemployment and societal breakdown.

[Busy Bee]

^A generation at a minimum.