Although it’s not quite the retail apocalypse, the industry has seen thousands of store closures this year, mostly because of a number of brands declaring bankruptcy.
According to a new report from Coresight Research, as of July 31, 2019, 7,567 stores have closed, with Payless closing the most: 2,100 stores. In all of 2018, 5,524 stores closed. However, it’s not all doom and gloom: So far this year, 3,064 stores have opened, whereas only 3,083 new stores opened in 2018.
It’s an interesting time in the industry, as latest earnings reports and news show the retail industry is still figuring out how to bring customers back—while other looming factors like the upcoming tariffs on Chinese-made goods and a potential recession are top of mind for executives.
Payless had the highest amount of store closures, but other retailers like Gymboree and Charlotte Russe declared bankruptcy. Those retailers closed 749 and 500 stores, respectively. Other store closures are on the horizon, with GNC announcing in an earnings call that it plans on closing 7oo-900 stores by the end of 2020 and Walgreens also stating it will close 200 stores (with no estimated timeline or locations).
In fact, some big-box retailers like Macy’s are reporting less-than-stellar quarterly earnings, and brands like JCPenney and Pier 1 are faing delisting from the New York Stock Exchange. Meanwhile, others are posting solid reports. Walmart’s quarterly earnings exceeded analysts’ expectations, with revenues growing 1.8% and ecommerce sales growing 37%. And, according to the U.S. Census Bureau, retail sales increased 0.7%; the estimate was 0.3%.
The general merchandise category sees an opportunity where calamity hits its competitors. Dollar General, Dollar Tree and Family Dollar made up 88% of store openings this year, with Dollar General planning on opening 975 stores, Dollar Tree looking at 348 and Family Dollar at 202 shops. Dollar General alone accounts for 56% of general merchandise store openings.
Other burgeoning industries include the food retail industry, which plans on opening 228 new stores (compared to the 23 that have closed this year). Aldi plans to open 159 grocery marts in 2019 alone, with the intent to open 2,500 by 2022.
In the digitally native and direct-to-consumer industry, store openings and pop-up shops continue to spring up, with companies like Away using recent funding to expand bricks-and-clicks strategies and Rent the Runway using flagship shops to draw in more customers. Ecommerce platforms like Shopify are refining retail hardware to enable more DTC and smaller businesses to open shops. And then, of course, there’s Amazon, which is opening more Amazon Go stores across the country.