Dive Brief:
- U.S. retailers are expected to close more stores than they open again this year, according to Coresight Research. Last year, 5,970 stores opened and 7,325 closed, a net loss of 1,355 as of Jan. 10.
- In 2025, Coresight expects about 15,000 U.S. stores to shutter, as openings remain steady at about 5,800.
- As of Friday, Coresight tracked more than 2,000 closures slated for this year, which represents a year-over-year increase of more than 334%, compared to nearly 30% fewer openings.
Dive Insight:
As Coresight notes, these trends reflect liquidations where retailers shutter all locations; distressed companies scaling back their fleets, sometimes due to restructuring or bankruptcy; and changes in brick-and-mortar strategy.
The closures announced for this year have been largely driven by announcements from Party City, Big Lots, Kohl’s and Macy’s, the firm said.
At the end of last year, for example, Party City filed for bankruptcy for the second time in about two years. This time, the retailer is in the process of liquidating and has said it will close all of its nearly 700 stores.
Big Lots, also in bankruptcy, has plans to salvage some of its store operations. In late December, the discounter said it would be forced to close all locations and began going-out-of-business sales, but days later announced a deal with Variety Wholesalers to acquire at least 200 stores and as many as two distribution centers.
Kohl’s doesn’t appear to be near bankruptcy, but has been struggling to gain traction in its turnaround. Earlier this month, amid traffic, sales and profit declines, the department store said it would close 27 underperforming stores by April. This was an about-face from a few years before when it had insisted that it would not only refrain from closing any locations but would actually add to its fleet.
Macy’s Inc., which runs Macy’s, Bloomingdale’s and Bluemercury, is probably the most financially healthy company in this group, but also has arguably scaled back its store footprint the most. Via a series of mergers and acquisitions in the late 20th century, the department store began the 21st with nearly 900 locations. Within 15 years, however, the conglomerate began shuttering many of them. Earlier this year, the company confirmed the first 66 stores that will close this year, part of its plan, announced a year ago, to close 150 Macy’s stores over three years.
