U.S. Retail Closures Up Almost 70% This Year As Thousands Of Stores Prepare To Go Dark
The holiday shopping season is currently in full swing, but U.S. consumers will have far fewer options in the new year when it comes to brick-and-mortar retailers.
About 7,100 store closures were announced nationwide through the end of November 2024, according to a new report from research firm CoreSight. That metric is up 69% from this time last year.
Family Dollar announced 677 store closures, more than any other retailer. CVS Health came in at No. 2 with 586. Big Lots, Conn’s and Rue 21 rounded out the top five with 580, 553 and 543 slated closures, respectively.
CoreSight also counted 45 retailers who have filed for bankruptcy in the first 11 months of 2024, up from 25 in all of 2023.
While consumer spending appears strong at the moment, many customers have been more selective and bargain-driven in the current climate.
“There is not enough growth in the retail market for every player to do well, which is why we are seeing polarized results,” GlobalData analyst Neil Saunders told CBS News.
“However, many of the chains closing stores are those that have problems which go beyond the economy. Their propositions might not be right, their offers might not be what consumers want, and they might not have responded to competitive threats in the right way.”
Family Dollar was purchased by its longtime competitor Dollar Tree for $8B in 2015. The parent company was exploring a sale of the smaller chain earlier this year.
Dollar Tree posted a $1.7B loss in its quarter ending on Feb. 3 and announced plans to shutter around 1,000 stores the following month.
Meanwhile, CVS is not the only pharmacy chain struggling recently. Rite Aid and Walgreens announced 408 and 259 store closures, respectively, this year, according to the CoreSight report.
CVS’ stock price rose from about $60 a share at the onset of the pandemic to more than $100 through much of 2022, but it has been falling since and now sits at just $45.
Analysts were sounding the alarm about the drugstore sector this time last year.
“Sales are down, occupancy costs are up,” Datex Property Solutions CEO Mark Sigal said of the sector at the time. “So just from a pure dollar inflow-outflow, drugstores are seeing those pressures.”
