Among the retailers who plan to close stores this year are the most battered chains in America. These include Bed Bath & Beyond, Gap and Party City. Even healthy retailers like Walmart will shutter some underperformers. A new study shows the total among all these will be at least 803. A brief economic downturn forecast for the second half of 2023 could worsen these numbers. (Click here to see which cities have the most Black-owned businesses.)
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Bed Bath & Beyond is expected to close over 400 locations. The retailer was close to bankruptcy until one of its investors threw it a lifeline recently. The sum involved easily could be too low, unless the retailer’s figures improve sharply. The modest cash lifeline allowed it to pay for inventory sold during the holiday. However, this lack of inventory means it had poor sales for the final quarter of 2022. Without a strong rebound early this year, bondholders will own Bed Bath & Beyond and the balance of the stores could be shuttered.
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Party City was another retailer that might have gone under. It will cut the 22 underperforming stores. Once again, the question about its future is whether a cash infusion can save it or if customers have abandoned it altogether.
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Gap has been closing stores for years. Its Old Navy brand, its largest, has stumbled. It could close nearly 80 stores, adding to the hundreds it has shut down over the past decade.
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Some large retailers make modest “tactical” shutdowns of very limited numbers of stores that underproduce. Walmart will close a few locations for this reason.
Home Depot and Walmart just announced earnings that were poor. Given their market share among all American retailers, this is bad news for smaller and financially weaker ones.
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