What has been called the retail apocalypse continues to ravage the brick-and-mortar retail industry. New research shows American retailers closed more than 9,300 stores in the first 50 weeks of the year. There is no sign that the pace will slow.
Coresight Research tracks the retail store sector in the United States. It reports that 9,302 locations have been closed over the period, up 59% from the full-year count of 2018. That means the 2019 total could increase more in the final two weeks.
The only reason the news is mixed for the industry is that most of the shuttering is due to the collapse of a handful of retailers. That does not, by any means, point to the survival of other retailers next year. There are already forecasts that some of America’s largest chains will need to downsize early in 2020.
Payless, the most prominent example in 2019, closed 2,100 locations, mostly in the first half of the year. A creditor liquidated the shoe retailer’s inventory. Ascena Retail closed 781 stores, mostly Dress Barns. The company recently announced a one-for-20 reverse stock split to keep its Nasdaq listing. The other retailer that had massive location shutdowns was Gymboree, which closed 749 stores. Famous retailers Gap and Sears made the list as well. These are the retailers closing the most stores this year.
Unspoken in the Coresight report are the ongoing struggles of once-great American retailers. Based on balance sheet debt loads, previous location shutdowns, revenue and profit figures, and same-store sales, Gap may close more stores. Disappearing Sears and Kmart may as well. J.C. Penney continues to struggle hopelessly. Macy’s troubles linger.
Retail location shutdowns will number in the thousands again next year. It would not be irresponsible to forecast that between 2019 and 2020, the total could reach 20,000, a figure unimaginable just a few years ago.
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