Major U.S. Retailers Are Closing More Than 6,000 Stores

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Major U.S. Retailers Are Closing More Than 6,000 Stores (Economic Collapse, May 1, 2015):

If the U.S. economy really is improving, then why are big U.S. retailers permanently shutting down thousands of stores?  The “retail apocalypse” that I have written about so frequently appears to be accelerating.  As you will see below, major U.S. retailers have announced that they are closing more than 6,000 locations, but economic conditions in this country are still fairly stable.  So if this is happening already, what are things going to look like once the next recession strikes?  For a long time, I have been pointing to 2015 as a major “turning point” for the U.S. economy, and I still feel that way.  And since I started The Economic Collapse Blog at the end of 2009, I have never seen as many indications that we are headed into another major economic downturn as I do right now.  If retailers are closing this many stores already, what are our malls and shopping centers going to look like a few years from now?

The list below comes from information compiled by About.com, but I have only included major retailers that have announced plans to close at least 10 stores.  Most of these closures will take place this year, but in some instances the closures are scheduled to be phased in over a number of years.  As you can see, the number of stores that are being permanently shut down is absolutely staggering…

180 Abercrombie & Fitch (by 2015)

75 Aeropostale (through January 2015)

150 American Eagle Outfitters (through 2017)

223 Barnes & Noble (through 2023)

265 Body Central / Body Shop

66 Bottom Dollar Food

25 Build-A-Bear (through 2015)

32 C. Wonder

21 Cache

120 Chico’s (through 2017)

200 Children’s Place (through 2017)

17 Christopher & Banks

70 Coach (fiscal 2015)

70 Coco’s /Carrows

300 Deb Shops

92 Delia’s

340 Dollar Tree/Family Dollar

39 Einstein Bros. Bagels

50 Express (through 2015)

31 Frederick’s of Hollywood

50 Fresh & Easy Grocey Stores

14 Friendly’s

65 Future Shop (Best Buy Canada)

54 Golf Galaxy (by 2016)

50 Guess (through 2015)

26 Gymboree

40 JCPenney

127 Jones New York Outlet

10 Just Baked

28 Kate Spade Saturday & Jack Spade

14 Macy’s

400 Office Depot/Office Max (by 2016)

63 Pep Boys (“in the coming years”)

100 Pier One (by 2017)

20 Pick ’n Save (by 2017)

1,784 Radio Shack

13 Ruby Tuesday

77 Sears

10 SpartanNash Grocery Stores

55 Staples (2015)

133 Target, Canada (bankruptcy)

31 Tiger Direct

200 Walgreens (by 2017)

10 West Marine

338 Wet Seal

80 Wolverine World Wide (2015 – Stride Rite & Keds)

So why is this happening?

Without a doubt, Internet retailing is taking a huge toll on brick and mortar stores, and this is a trend that is not going to end any time soon.

But as Thad Beversdorf has pointed out, we have also seen a stunning decline in true discretionary consumer spending over the past six months…

What we find is that over the past 6 months we had a tremendous drop in true discretionary consumer spending. Within the overall downtrend we do see a bit of a rally in February but quite ominously that rally failed and the bottom absolutely fell out. Again the importance is it confirms the fundamental theory that consumer spending is showing the initial signs of a severe pull back. A worrying signal to be certain as we would expect this pull back to begin impacting other areas of consumer spending. The reason is that American consumers typically do not voluntarily pull back like that on spending but do so because they have run out of credit. And if credit is running thin it will surely be felt in all spending.

The truth is that middle class U.S. consumers are tapped out.  Most families are just scraping by financially from month to month.  For most Americans, there simply is not a whole lot of extra money left over to go shopping with these days.

In fact, at this point approximately one out of every four Americans spend at least half of their incomes just on rent

More than one in four Americans are spending at least half of their family income on rent – leaving little money left to purchase groceries, buy clothing or put gas in the car, new figures have revealed.

A staggering 11.25 million households consume 50 percent or more of their income on housing and utilities, according to an analysis of Census data by nonprofit firm, Enterprise Community Partners.

And 1.8 million of these households spend at least 70 percent of their paychecks on rent.

The surging cost of rental housing has affected a rising number of families since the Great Recession hit in 2007. Officials define housing costs in excess of 30 percent of income as burdensome.

For decades, the U.S. economy was powered by a free spending middle class that had plenty of discretionary income to throw around.  But now that the middle class is being systematically destroyed, that paradigm is changing.  Americans families simply do not have the same resources that they once did, and that spells big trouble for retailers.

As you read this article, the United States still has more retail space per person than any other nation on the planet.  But as stores close by the thousands, “space available” signs are going to be popping up everywhere.  This is especially going to be true in poor and lower middle class neighborhoods.  Especially after what we just witnessed in Baltimore, many retailers are not going to hesitate to shut down underperforming locations in impoverished areas.

And remember, the next major economic crisis has not even arrived yet.  Once it does, the business environment in this country is going to change dramatically, and a few years from now America is going to look far different than it does right now.

5 thoughts on “Major U.S. Retailers Are Closing More Than 6,000 Stores

  1. I am only giving my take on those stores with which I have personal knowledge.

    180 Abercrombie & Fitch (by 2015)
    Higher end discretionary spending…..much can be bough online at better cost. There is nothing they sell that cannot be found online.

    223 Barnes & Noble (through 2023)
    Amazon and Kindles are killing the book stores I love……Printed media is in danger of becoming obsolete. It isn’t just economics, it is the drive to put all information online. A Kindle publication is cheaper, takes a minute to download……..as a rare book collector, this trend is like a nightmare to me.

    120 Chico’s (through 2017) Pity. It is a wonderful clothing store for the women who travel. The clothes are distinctive, they don’t wrinkle in a suitcase, and they offer many mix and match quality items to round out a wardrobe for travel. The problem in travel is to have enough clothes yet carry as little as possible. As I don’t travel as I did….and millions of others are in the same boat, Chico’s is suffering. It is a great niche provider. Also, Costco now offers some of the same high quality clothes at a cheaper price……..
    This is one example of how the slow economy has really hurt the consumer and the retailer. It has been going on for years, the myth the next recession will hurt is a joke. We never got out of the last one.

    70 Coach (fiscal 2015)For the last 30+ years, I have never carried any purse that was not Coach. The straps are weighted properly, they stay on the shoulder, and the understated elegance of the purses had me paying full retail for years. Fine leather, no brand name blaring from them…..
    But, in the last few years, they have changed their line to garish bags with Coach written every few inches. I already have a closet full of the leather bags created in the earlier years, and it is a good thing. I have no interest in the ugly new bags.
    Also, high end purses are an investment. Buy enough as I did, and the need for more decreases over time. Also, Coach bags can be found for less money online. I could sell some of mine for a good price, but what would I carry then?
    Coach is a market for people who are earning good money as I used to do. Today, there are far fewer people with the extra money to spend at a Coach store.

    70 Coco’s /Carrows: Ugh, good riddance.

    340 Dollar Tree/Family Dollar: I have no idea why these stores are closing.

    31 Frederick’s of Hollywood: All can be bought online.

    50 Guess (through 2015) Brand name is what sells, and it can be had online for less money.

    40 JCPenney: Another of the last middle class stores to bite the dust…..pity.

    127 Jones New York Outlet: Selling this lovely dress line as a discount outlet was a big mistake. I always favored JNY, but the junky discount numbers leave me cold. I guess I am not the only one.

    14 Macy’s: Quality and selection has dropped dramatically, and I don’t shop there any longer……it is junk.

    400 Office Depot/Office Max (by 2016): Costco and other big box stores offer more for less money.

    100 Pier One (by 2017): Stores full of pretty but cheap foreign goods. Nothing essential, such a store does well in a good economy, not one where people watch their spending carefully.

    1,784 Radio Shack: Going bankrupt. They have not kept up with the times….too bad.

    77 Sears: Another middle class store sinking into the abyss.

    55 Staples (2015)Overpriced.

    200 Walgreens (by 2017) Parts of a bigger monopoly….no sympathy.

    The mood of consumers have changed.
    Thrift stores are cropping up all over American towns…….this doesn’t happen in a good economy.
    It is a pity our broadcasters are too mendacious to tell the truth…..

  2. Of course the great American public will reject this, then, as it manifests into reality, ostrichitis will prevail as the internet takes over, destroying more jobs in the tidal wave of automation, until finally as reality sinks in that the economy really has collapsed, the ensuing panic will enable the elite’s desired effect of Martial Law to take place.

    It will be interesting to see how close this forecast becomes.

    http://theeconomiccollapseblog.com/archives/a-third-of-all-u-s-shopping-malls-are-projected-to-close-as-space-available-signs-go-up-all-over-america

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