Retailers That Will Close Hundreds of Stores Next Year
The good news for U.S. retailers this holiday seasons is that revenues are expected to rise by about 4% and same-store sales are figured to increase by 1%. The less-good news is that profits for the fourth quarter (ending in January) are expected to fall 1.8%.
Heavy promotional pricing began earlier this year and retailers essentially faced a race to the bottom in an effort to maintain sales. But store traffic has not improved; in fact it’s weakened. And Amazon.com Inc. (NASDAQ: AMZN) continues to take sales and profits from brick-and-mortar stores.
The result is likely to be that supposed and announced store closures will go ahead as planned and may even increase for some retailers. According to an estimate made last June from Green Street Advisors, about 25% of all U.S. department stores need to close in order for the industry to return to the sales-per-square-foot levels of 2006.
A total of 14 major retail chains have said that they will close at least 100 stores by the end of 2020. Most will reach that total by the end of 2017. In some cases, these numbers appear to be on the low side, given the difficulties some retailers are encountering.
Aeropostale. The chain filed for bankruptcy in May 2016 and said it would close 154 stores. Now it appears that the chain will close all but about 230 of its 800 or so stores.
American Eagle Outfitters Inc. (NYSE: AEO). The company plans to close 150 stores over three years.
Chicos FAS Inc. (NYSE: CHS). Planned to close 120 stores between fiscal 2015 and 2017.
The Children’s Place Inc. (NASDAQ: PLCE). Planned to close 200 stores between fiscal 2015 and 2017.
Finish Line Inc. (NASDAQ: FINL). Has said it will close 150 stores by 2020.
Hancock Fabrics. The company filed for bankruptcy in February 2016 and will close all 255 of its stores.
Macy’s Inc. (NYSE: M). Plans to close 100 stores.
Men’s Wearhouse Inc./Jos. A. Banks. Parent Tailored Brands Inc. (NYSE: TLRD) plans to close 250 stores, primarily outlet stores.
Office Depot Inc. (NYSE: ODP). At the time of its merger with OfficeMax, the chain said it would close 400 stores by the end of this year, and that appears to be the case.
Sears Holdings Corp. (NASDAQ: SHLD). Between Sears and Kmart stores, the company plans 142 store closings, with more likely.
Sports Authority. Another bankruptcy, with 140 stores closing.
Walgreen Boots Alliance Inc. (NYSE: WBA). The company planned to close 154 stores. Last week the company announced the sale of 865 Rite Aid Inc. (NYSE: RAD) stores to Fred’s Inc. (NASDAQ: FRED) in an effort to win approval for the Walgreens-Rite Aid merger.
Wal-Mart Stores Inc. (NYSE: WMT). Has said it will close 154 U.S. stores and open 300 in the rest of the world.
Wolverine World Wide Inc. (NYSE: WWW). Expected to close 100 stores worldwide.