The big-name stores disappearing across America in 2018
Daniel Coughlin
27 November 2018
Mall and shopping street favorites downsizing to survive
Analysts are calling it the retail apocalypse. Across the nation, stores are shutting down in their thousands with 50% of the malls in America expected to close by 2023. We take a look at the reasons behind the bricks and mortar meltdown and fill you in on all the key recent and upcoming store closures.
Middle-class squeeze
A number of factors are behind this unprecedented retail crisis. Increased housing, healthcare, education and other costs, coupled with sluggish wage growth, mean middle-class Americans have less disposable income to splash on consumer goods.
Changing spending habits
At the same time, Americans are changing how they shop and spend their money. Millennials especially are spending less on clothing, gadgets, furniture and so on, and more on eating out, travel and other experiences. This rise in 'experience spending' is hitting retailers hard.
Move online
As well as spending less on consumer products in general, an increasing number of Americans are abandoning malls and shopping streets, and choosing to shop online. Mall traffic in particular has declined spectacularly while internet shopping has surged in popularity. In fact, according to a UPS study 54% of Millennials purchase items online, and only 11% of those surveyed had made their last purchase in a retail store.
Rising retail overheads and debt
If things weren't bad enough, many chains are saddled with unsustainable debt, mainly from leveraged buyouts, and are having to contend with rising overheads, from rents to energy bills. All these factors combined have created the perfect storm for traditional retailers.
2018 reflects 2017
In 2017, a record 7,000 stores closed down, representing a total of 105 million square feet of retail space. A slew famous retailers downsized their physical presence or went out of business entirely last year including RadioShack, The Limited, GameStop, BeBe Stores, BCBG Max Azria and American Apparel, and 2018 is shaping up to be equally disastrous. Let's take a look all the key closures.
Nordstrom: 1 store shut
Earlier this year, upscale department store chain Nordstrom announced the closure of its Salem, Oregon store, affecting a total of 130 employees. The underperforming location will shut its doors later this year.
DASH: 2 stores
Even A-list celebrities haven't been immune to the retail apocalypse. The Kardashian sisters are closing their two remaining DASH boutiques in Los Angeles and Miami to focus on more lucrative projects, such as their lifestyle apps and fashion lines.
Mattel Toy Store: 4 stores
Toy stores have been especially hammered by the bricks and mortar meltdown. Mattel's eponymous retail chain for instance is losing four locations: New York, San Bernardino in California, Fort Worth, Texas and Wilmot, Wisconsin. The maker of Barbie and Fisher Price was particularly hit by the closure of Toys R Us, which was Mattel's second largest customer. When Toys R Us folded, it owed Mattel $135 million, which it is unlikely to get back.
Charlotte Olympia: 4 stores
British high-end shoes and accessories label Charlotte Olympia is shuttering all four US stores after filing for Chapter 11 bankruptcy. The boutiques had been unprofitable for some time with creditors blaming their financial collapse on “the widespread disruption in the retail industry”.
Island Pacific: 6 stores
Like Kroger, supermarket chain Island Pacific, which specializes in Asian products, announced the closure of six stores earlier this year. They include two locations in San Diego and stores in Los Angeles and San Jose. Its 17 remaining stores will stay open.
Land of Nod: 6 stores
Children's furniture store Land of Nod has been put to sleep with every single one of its bricks and mortar stores shutting this year. They include locations in Chicago, Seattle and Costa Mesa, California. The business will however continue online.
JCPenney: 8 stores
After calling time on almost 141 stores last year, JCPenney is shuttering a further eight in 2018. The department store chain is also closing one of its fulfillment centers in Wisconsin with the loss of 600 jobs.
Lord & Taylor: 10 stores
New York's oldest department store, Lord & Taylor, which was founded way back in 1826, recently announced the closure of its iconic Fifth Avenue flagship, as well as nine other stores. The Big Apple location will be repurposed as a WeWork co-working space.
The Vitamin Shoppe: 10 stores
Stores that sell vitamins and other health supplements, which tend to be more affordable online, have been severely battered by the retail meltdown. The Vitamin Shoppe is planning to cull 10 stores this year, though the chain is in the process of opening two new locations.
Last Call by Neiman Marcus: 11 stores
The discount arm of luxury department store chain Neiman Marcus has given the very last call to 11 underperforming locations already this year with the store at Woodbury Common Premium Outlets in New York slated to shut down in July.
Target: 12 stores
A total of 12 Target stores have bitten the dust in 2018, including locations in Florida, Illinois and Minnesota. Be that as it may, the Minneapolis-based retailer is opening 35 new stores this year in more profitable locales.
Kroger: 14 stores
Kroger closed 41 stores out of almost 2,800 locations in 2017. In 2018, the Cincinnati-based supermarket chain called it a day on 14 more, including two stores in Pretoria, Illinois that hadn't turned a profit for the past 15 years.
J.Crew: 20 stores
Profits at J.Crew slumped 7% in the fourth quarter of 2017, prompting another round of store closures to add to the 50 locations that shut for good last year. All in all, 20 J.Crew stores will close their doors for the last time in 2018.
Kiko: 24 stores
Beauty retailer Kiko USA filed for Chapter 11 bankruptcy in January following a run of ugly financial results, which the company put down to fierce online competition and falling footfall in America's malls. The chain is shuttering 24 of its 29 locations in the US.
Macy's: 30 stores
In January, Macy's revealed it would be closing 11 stores, adding to the 70 the department store giant axed last year. The company is also planning to shut a further 19 stores to reduce its bricks and mortar footprint and concentrate more on e-commerce. These closures are in line with the store's 2016 announcement that it would be shutting down 100 shops over the next few years.
A'Gaci: 49 stores
Yet another retailer that has filed for Chapter 11 bankruptcy in 2018, women's cheap-chic chain A'Gaci is saving its skin by closing 49 of its 78 stores, including 21 locations in Texas. The firm has blamed the general shift online, IT issues and last year's major hurricanes for its economic woes.
Vera Bradley: 50 stores
Handbag and homeware retailer Vera Bradley is undergoing a massive shake-up. The chain, which is slimming down its product lines, plans to shut 50 full-line stores by 2021 and open 52 outlet locations. While it has redesigned its website in order to make the most of its new 'digital first' strategy.
Abercrombie & Fitch: 60 stores
Faced with increasing online competition, Abercrombie & Fitch has announced the closure of 60 stores in America this year, on top of the 39 that were shuttered in 2017, and the 54 it closed in 2016. The strategy is paying off, though, as it reported strong sales growth in the fourth quarter of 2017.
Sam's Club: 63 stores
In January, Walmart shut down 63 of its Sam's Club membership-only warehouses, impacting 9,400 employees. The retail giant is transforming 10 of the locations into e-commerce distribution centers, a savvy move given the ongoing shift online.
Nine West: 71 stores
All 71 Nine West stores were shuttered this year and the women's fashion chain filed for Chapter 11 bankruptcy in April. Parent company Nine West Holdings is selling its eponymous label to New York's Authentic Brands Group.
Teavana: 77 stores
Starbucks bought the American tea company in 2012. However, in 2017 announced that it would have to close all 379 stores in 2018. However, as most of the stores are in malls one – Simon Property Group – launched legal action as it believed that the closures would reduce footfall to other stores in their malls. In January 2018, Starbucks was given permission to close 77 of the Teavana stores.
Aaron Brothers: 94 stores
In March, arts and crafts retailer Michaels announced the closure of all its Aaron Brothers framing stores, apart from three locations in Texas. In total, 94 stores are going as the company consolidates operations, and adapts to a "store-within-store" concept where the framing service will be available in all of its Michaels stores.
Southeastern Grocers: 94 stores
Up to its eyeballs in debt, Southeastern Grocers filed for Chapter 11 bankruptcy in March, adding to the victims claimed by the retail apocalypse. The Florida-based firm, which operates several big-name supermarkets including Bi-Lo and Winn-Dixie, is closing 94 stores this year.
Charming Charlie: 100 stores
Having filed for Chapter 11 bankruptcy in December, jewelry and accessories chain Charming Charlie has gone on to close 100 stores that were reporting lackluster sales, and is now down to just over 260 locations nationwide.
Brookstone: 101 stores
The specialty retailer that sells everything from Segways to ergonomic chairs originated as a mail order service, that expanded its gift-selling business into physical stores in 1973. However, the chain filed for bankruptcy in the summer and closed 101 of its mall stores in 2018. The company is now seeking a buyer for 35 airport locations.
Foot Locker: 110 stores
Foot Locker is in the midst of a full-on restructuring program. The sneakers retailer is weeding out 110 unprofitable locations throughout America. On the upside, a total of 40 new Foot Locker stores will open their doors this year.
Guess: up to 120 stores
Guess has been streamlining its operations over the past three years, closing a total of 122 stores in 2016 and 2017. This year, the fashion retailer is ditching up to 120 US locations, but will expand its physical presence in Asia and Europe.
Michael Kors: up to 125 stores
Sales in Michael Kors' physical stores fell 14.1% in the first quarter of this year. As a result, the luxury retailer is getting rid of up to 125 locations, though a number of new stores will open in more advantageous localities. This move is predicted to save the luxury brand as much as $60 million.
The Children's Place: 144 stores
Kids' clothing retailer The Children's Place is calling time on a total of 144 stores by 2020. The apparel chain is embracing digital in a big way, and plans to move the bulk of its retail operations online.
Claire's: up to 170 stores
Teen accessories favorite Claire's, which has debts of almost $2 billion, filed for Chapter 11 bankruptcy in March. The chain is liquidating 92 stores this year and planning to dump an additional 78 locations by 2022.
Sears and Kmart: at least 188 stores
Sears Holdings just can't stop closing down stores across America as it struggles to stay afloat. Last year, 400 Sears and Kmart locations were axed and the ailing company is shutting at least 188 more in 2018. To make matters worse, the company has already announced that it will be closing another 40 stores in February 2019.
GNC: 200 stores
Vitamin retailer GNC joined the Chapter 11 bankruptcy club in September and, like competitor Vitamin Shoppe, continues to struggle. As part of its efforts to revive the business, the chain is axing around 200 locations this year.
Gap and Banana Republic: 200 stores
Last year, Gap Inc. announced the closure of 200 underperforming Gap and Banana Republic stores, which will be gradually phased out over a three-year period. During the same time, Gap Inc. plans to open 270 Old Navy and Athleta locations.
Signet Jewelers: 200 stores
Signet Jewelers has been badly affected by the drop in mall traffic and is in the process of closing 200 failing stores. Although, the company has stressed that three quarters of the stores set to close are in malls where there are other Signet stores.The parent company of Kay Jewelers, Zales and Jared is looking to expand away from malls by opening a number of new locations in shopping streets throughout America.
Best Buy mobile: 250 stores
At one time during the late 2000s, Best Buy operated 400 mini mobile stores in malls across the US, but as cellphone sales moved online the number of locations dwindled to 250, all of which are shutting down this year.
Bon-Ton Stores: 256 stores
After entering Chapter 11 bankruptcy and failing to find a buyer, department store group Bon-Ton Stores is liquidating all of its 256 locations this year. The big names closing their doors forever include Bon-Ton, Carson's, Elder-Beerman and Younkers.
Ascena Retail Group: at least 268 stores
Ascena Retail Group, the parent company of several well-known fashion chains including Ann Taylor, Dressbarn and Lane Bryant, is closing 268 stores this year, adding to the 400 locations that vanished in 2017. The company says that the remaining 399 stores are also at risk of being shut down if landlords don't reduce rents.
Gymboree: 350 stores
Staying with children's apparel chains, Gymboree filed for Chapter 11 bankruptcy last July and agreed to shut down hundreds of stores to help restructure its debts. As of June 2018, the firm has re-emerged from bankruptcy but 350 locations are no more.
Walgreens/Rite Aid: 600 stores
Leading pharmacy chain Walgreens has closed 600 Rite Aid stores this year following its acquisition of nearly 2,000 Rite Aid drugstore locations. Walgreens was forced to ditch the stores to appease anti-trust regulators and save the deal.
Mattress Firm: up to 700 stores
As many as 700 Mattress Firm stores are shutting for good this year as the chain works to solve its financial problems and fight increasing online competition, which has been hitting the business where it hurts for some time now.
Toys “R” Us: 735 stores
This year's most high-profile retail collapse, Toys “R” Us entered Chapter 11 bankruptcy last year but was unable to find a buyer, leading to the closure of all 735 of its US stores. The chain will live on in Canada, so American fans of the store will have to head north of the border to get their retail fix in future.
Thriving retailers
Not every retailer is struggling in the US. In fact, plenty of chains are positively booming, particularly budget-friendly ones. Dollar General, for instance, is opening 900 new locations this year; Dollar Tree is launching 650 new stores, while supermarket Aldi and no frills department store Ross Stores are opening at 800 and 40 more locations respectively.
Comments
Be the first to comment
Do you want to comment on this article? You need to be signed in for this feature