There Really Are Too Many Stores. Just Ask The Retailers.

by MR Magazine Staff

On your most recent shopping trip, there’s a good chance you noticed that one of your favorite stores is shuttering its doors. Walmart has said it will close 154 U.S. stores this year. Macy’s is in the process of axing 40 locations. By June, department store Kohl’s will shutter 18 stores.

Some of this is surely cyclical, as retailers routinely look to the beginning of the calendar year as a moment to prune underperforming stores. But this year, it’s hard not to look for deeper meaning in the wave of closures: The retail industry recorded a disappointing holiday shopping season, delivering only 3 percent sales growth, far below the 3.7 percent increase it had expected. Meanwhile, our shopping dollars continue to march online, and young, affluent consumers are moving back into big cities instead of taking up in America’s mall-dotted suburbs. That confluence of factors poses a tough question: Do some of the biggest names in retail simply have too many stores?

In industry jargon, this is called being “overstored,” and it’s a position that more and more retailers — especially the large ones — are likely to find themselves in as shopping and demographic patterns change. Read more at The Washington Post.