Survey Shows Retailers to Shut Down Almost 3,200 Stores, an Increase from Previous Year
Retail chains across the U.S. are experiencing a significant increase in store closures in 2024, with nearly 3,200 brick-and-mortar locations shuttering, which marks a 24% increase from the previous year. CoreSight Research highlights that this uptick in closures is accompanied by a slight decline in new store openings. Factors contributing to these closures include bankruptcies, high inflation, and rampant shoplifting, with major retailers like RiteAid and Rue21 filing for bankruptcy and attributing their financial struggles to these issues. Additionally, the ongoing shift towards online shopping continues to affect physical store traffic negatively. Dollar Tree, for instance, plans to close over 600 Family Dollar stores, citing inflation and theft as primary reasons. This trend underscores the changing dynamics in the retail industry and the shifting consumer behavior towards e-commerce.
Retail chains are closing thousands of stores this year, nearly a quarter more than by this time last year, a new survey shows.
Companies are announcing the closures of almost 3,200 brick-and-mortar stores so far in 2024, according to a recent analysis from CoreSight Research, which tracks store closures and openings.
This is a 24% increase from a year ago, according to the report.
Major retail chains have announced about 4% fewer store openings compared to this time last year as well.
The stores cite multiple factors, including bankruptcies, inflation, and shoplifting, all of which lead to the prohibitive costs of keeping the stores open. Organized retail theft rings have become an urgent problem for both retail chains and small businesses in some areas.
Another factor is customers opting to shop online at places like Amazon rather than in person, a trend that has driven down store traffic over the past two decades.
RiteAid and Rue21, a clothing company, have both declared bankruptcy. Rue21 cited inflation and is laying off all of its 4,900 employees. RiteAid will close 165 stores this year.
About eight million square feet of closed retail space resulted from drug store and pharmacy closures in the U.S. this year, the CoreSight report noted.
Dollar Tree cited inflation and shoplifting in announcing plans to close more than 600 Family Dollar locations, the largest number of any retailer so far this year.
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Tupperware announced last week that it will close its only U.S. factory located in South Carolina, laying off all 148 workers starting in September.
The container company will continue production at a Mexico plant.
Other companies closing a large number of stores include 99 Cents Only Stores, which is closing 371 stores, CVS with 315 stores, 7-11 with 272 stores, Express with 105 stores, Walgreens’ parent company with 77 stores, and Macy’s with 51 stores.
Stores closing under 50 stores include Sleep Number, Burlington, Foot Locker, Carter’s, Abercrombie & Fitch, Big Lots, Dollar General, H&M, Best Buy, and Ross, among others.
However, several of these chains are also expanding. Dollar General plans to add more than 800 locations this year, and 7-Eleven plans to open more than 270 new stores this year. Five Below also plans to open 227 new stores.
The skyrocketing inflation of the last several years has caused prices for everyday necessities to spike, including food, gas, and housing, and Americans are feeling the pain in their wallets.
Prices are up an eye-popping 20% since January, 2021, before inflation spiked.
Inflation has fallen significantly after peaking at 9.1% in June, 2022, but as of last month it remained high at about 3.3%, much higher than the Federal Reserve’s goal of 2%.
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